Sutiyoso admits water deal unfair

JAKARTA: Governor Sutiyoso said here on Friday that he once hired consultants from Singapore to study the contract between the city tap water company PT Pam Jaya and its two foreign partners. The consultants concluded that the arrangement was not in the city's favor.

The recommendation from the consultants showed that eleven points of the contract had clearly benefited the foreign companies, to the detriment of city-owned company PT Pam Jaya, according to Sutiyoso.

"One of the eleven points was that the water charges should be increased in every six months," he said. He did not elaborate on the other points.

However, the contract also states that the city administration, or PT Pam Jaya, must repay any funds previously invested by the foreign partners, if either party decided to break the contract.

PT Thames Pam Jaya, a subsidiary of Britain's Thames Water International, and PT Pan Lyonaise Jaya (Palyja), a subsidiary of France's ONDEO (formerly Lyonaisse des Eaux), won the water contract in early 1998. But it was criticized because the deal was done with the support of ousted president Soeharto's son. It was revised in 2001, but Sutiyoso said it is still detrimental to the city.--JP