Sat, 27 Dec 2003

Water bill needs more debate: Activist

Muninggar Sri Saraswati, The Jakarta Post, Jakarta

A foreign activist has encouraged Indonesians to continue debating privatization and other issues concerning the bill on water resources, saying that people must have full control over the use of water resources.

Samir Dossani of the Philippines said recently that a thorough debate within Indonesia was a must because water involved the interests of every Indonesian.

There is no doubt, he said, that water services in Indonesia were poor and, therefore, must be improved.

"Privatization should not be ruled out completely, but whatever method is chosen by Indonesians must be backed up by evidence. Indonesia must start out on the goal of providing affordable water for all, especially the poorest people," he said.

Dossani said the bill on water resources failed to give the people control over water resources. Instead, the bill opened the door to uncontrolled privatization.

Article 40 (2) of the bill stipulates that the government may set up a regulatory body under the authority of the minister in charge of water resources and accountable directly to the minister, as part of the effort to achieve the goal of providing affordable water and sanitation in a way that met the interests of both consumers and water companies.

According to Dossani, the regulatory body needed to be a strong body that was capable of protecting the interests of water consumers. He pointed to a case involving privatization in Atlanta, USA, in which the people had taken back control of water resources.

"In Atlanta, an evaluation was done and there was a large amount of evidence showing that privatization was not good for the citizens. Atlanta voted to undo its privatization after a careful review of the costs and benefits," he said.

By contrast, Jakarta people had no power to control the water sector. They could do nothing when the charges for tap water increased despite what they perceived as a lack of improvement in water quality.

Currently, two international water companies are threatening to pull out of Jakarta if the government rejects their requests for increased charges.

Dossani claimed that a number of international institutions, like the World Bank and the Asian Development Bank (ADB), could support the interests of giant foreign water companies in the drafting of the bill.

According to Dossani, those international institutions tended to take a standard approach to the water sector, focussing on financial viability above all, and consequently privatization, decentralization, cost recovery measures and so on.

"Should financial viability, that is, the ability of a utility to make money, be more important than providing safe, affordable water to all? This is a question for Indonesians to decide through democratic processes, not for the World Bank or ADB to decide," he said.

Dossani was referring to the World Bank-sponsored water resources sector adjustment loan (Watsal) scheme worth a total of US$300 million.

The government commited itself to the scheme in 1999 when the country faced severe financial difficulties following the economic crisis. The scheme requires that Indonesia reform its legislation on the water sector to allow for privatization.

The World Bank has indicated that it may not disburse the Watsal's third and last tranche due to Indonesia's failure to produce a bill on water resources that met the country's 1999 commitment on water resources policy reform.

But, the World Bank rejected accusations that it was involved in a possible scenario designed to permit giant foreign companies to get involved in the water sector in Indonesia.

The Asian Development Bank (ADB), which also co-sponsored the scheme, rejected The Jakarta Post's request for an interview on the issue.