YLKI urges court settlement for water agreement dispute

YLKI urges court settlement for water agreement dispute

JAKARTA (JP): Zoemrotin KS, an executive of the Indonesian
Consumers Foundation (YLKI), urged the city-owned water company
PDAM Jaya yesterday to settle its current dispute with its local
and foreign business partners in court.

She said settling the dispute in court would likely constitute
the best solution to clarify whether or not collusion was really
involved in the awarding of the contracts.

"Terminate the agreement contracts if collusion is discovered
or if the private partners have really neglected their
obligations, as is being alleged by PDAM," she said.

Zoemrotin made the remarks after delivering a speech at a
seminar on PDAM's deal with the private companies held by the
Association of Indonesian Water Works Contractors.

"I believe that the deal was awarded to the private companies
under the influence of the 'K3N' (collusion, corruption, cronyism
and nepotism) practices," she said.

The fact that the private companies got the project without
open tendering was a strong indication of that, she said.

"The other indication was that the companies which won the
projects were actually 'those kind of people'", Zoemrotin said
referring to PDAM's private partners PT Garuda Dipta Semesta
(GDS) and PT Kekar-Thames Airindo (Kita).

She demanded that officials at PDAM, the city administration
and other institutions which were allegedly involved in the
decision process from the outset also be investigated.

"All officials, including the governor or minister who were
involved in the project from the beginning must not refrain from
sharing the responsibility. It's not fair if we only accuse
officials who are in charge at the moment," said Zoemrotin.

Governor Sutiyoso gave his approval in February for PDAM to
work with GDS, a joint venture between tycoon Sudono Salim's
business empire and French firm Lyonnaise des Eaux, and Kati, a
joint venture between former President Soeharto's eldest son
Sigit Hardjojudanto's Kekarpola Airindo and British firm Thames
Water International, on 25-year cooperation agreements.

PDAM's director, Rama Boedi, surprisingly announced his
company's takeover of the water management and operation
activities from GDS and Kati on May 23, accusing the latter of
neglecting their technical and financial obligations as partners.

The takeover decision was endorsed by the governor's Letter of
Instruction No. 131 dated May 22, he said.

On May 26, some 3,000 PDAM employee, including Rama himself,
publicly voiced their determination at the company's Bendungan
Hilir headquarters to end their cooperation with GDS and Kati.

Zoemrotin, however, was against Rama's takeover policy, saying
it was a one-sided decision.

"Rama, and even the governor himself, should have proved all
the allegations against the private partners first before
deciding to take over the management from them," she said.

Separately, deputy governor for administrative affairs Abdul
Kahfi indicated yesterday that the contracts between PDAM and its
partners GDS and Kati were still effective.

Kahfi said the current dispute was only a matter of
misunderstanding and that the two private companies might resume
their activities as soon as the case was clarified by all
parties.

"But, when the cooperation will resume or how it will be
implemented afterward totally depends on the governor," he said.

Kahfi said that PDAM had misinterpreted the governor's
instruction. PDAM tended to see the instruction as a command to
terminate the contract, he added.

"The instruction just ordered PDAM to quickly take action to
anticipate the absence of water services," he said.

He said that his office was still discussing the matter with
PDAM and its partners.

However, Kahfi rejected Zoemrotin's idea of settling the
dispute in court. "Let's not go that far," he said. (cst/ind)