Tuesday, August 2, 2011

TheSun:Untangling the politics of water

LET me make my column debut in theSun by writing about water, undoubtedly life’s most precious commodity. Because the people are accustomed to thinking that there is so much water available, by and large Malaysians’ appreciation of the real value of water is perhaps the lowest in the world.

A survey showed that Malaysians wasted the most water compared with other consumers in Southeast Asia. This wanton wastage is all too obvious for everyone to see, especially by the ubiquitous car-wash outlets and council lorries watering plants by the roadside.

In the face of this, two SOS warnings rang out in quick succession last week of an impending water crisis that could break out by next year in Selangor, Kuala Lumpur and Putrajaya, the nation’s most densely populated regions, if steps being planned to overcome it are not immediately implemented.

Datuk Lee Miang Koi, the chief operating officer of Syabas, the privatised water services concessionaire for the three regions, warned on Thursday that reserves were at very low levels at 3-5% while the population in these areas had increased by 3.5% a year over the last six years. Syabas serves a population of 7.3 million plus industrial and commercial users through 1.52 million accounts.


Statistics from the 2010 Population and Housing Census showed that Selangor continued to be the most populated state with 5.4 million or 19.3% of the nation’s population. Putrajaya had the highest population growth of 17.8% between 2000 and 2010.

Needless to say, the consequences of a water crisis or even a semblance of one, are unimaginable as Selangor is Malaysia’s industrial and commercial hub. Kuala Lumpur is the nation’s capital and the main gateway for the tourism industry while Putrajaya is the administrative capital.

In order to meet the demands especially during peak periods and to expedite the supply recovery period in the event of disruptions, it is crucial for the reserves to be raised to at least 10% capacity. And in a grim warning to all, Lee does not rule out the possibility of these three key regions facing a “critical water crisis” even earlier than next year.

Just two days after Lee pressed the panic button, Syabas executive director Roowina A. Rahim Merican said if the low reserves dry up, Syabas has no contingency plan within its means to avert the crisis. The two officials fell short of blaming the “politics of water” for raising this spectre of a crisis, but to all intents and purposes this is what it boils down to.

For example, the one project that could resolve the crisis is till mired in politics that has since worsened following Barisan Nasional losing Selangor to the Pakatan Rakyat coalition in April 2008. The project to channel raw water from Pahang to Selangor via a 44.6km-long pipeline costing RM3.94 billion is behind schedule because the Selangor government has yet to grant a development order to proceed with the construction of the Langat 2 treatment plant.

Even if this project is not held to ransom by politics, it would be ready only by 2014, but with the “impasse”, no one knows when it could take off.

To begin with, in a move that could only be said to be unfortunate from the water conservation point of view, the state government under Mentri Besar Tan Sri Abdul Khalid Ibrahim kept its election promise of giving free water (for the first 20 cu m). This means that most domestic consumers, including the rich, have been paying practically zero for more than three years for their water.

For this “populist” move, Selangor has to fork out RM11 million monthly to compensate Syabas or RM132 million a year, money that could be better spent on helping the poor. Playing politics with a life-giving commodity such as water of course has its “victims”.

Syabas and its three water treatment operators are facing serious cash flow woes because the Khalid administration has rejected its bid to raise tariffs by 37% from January 2009 as provided for under the 30-year concession agreement signed in 2004.

Syabas has sued the Selangor government and it would be interesting to watch the outcome of the case. But the legal process being what it is, it would be still be a long way off before the verdict is out.

Not allowing the tariff increase is yet another populist move because although it’s 37%, it would only mean an average RM3 increase a month for most domestic consumers, less than what most parents pay daily to top up the credit line for mobile phones of their school-going children.

It has resulted in situations where Syabas was forced to under-pay the three operators, which put it in a real danger of facing legal suits in the event of a default. But the federal government was quick to intervene by taking over the bonds issued to the players during the process of privatisation.

It is in everybody’s interest that approval for the Langat 2 treatment plant be given without further delay.

The Selangor water “deadlock” is indeed a lesson for the powers that be to learn from the wisdom of privatising a “sacred” asset like water, given the scenario of a change of government between parties that politically don’t see eye to eye on most matters.

Khalid is stalling approval for this vital project as he has announced plans for a “holistic approach” to the water issue, including the ambitious take over of the water assets estimated at RM10 billion.

The question is, does he want to wait for a water crisis to set in before he decides on his next move?

I have known Khalid for well over 20 years since his time as CEO of Permodalan Nasional Berhad, the national equity corporation. For whatever it’s worth, I appeal to him to set aside politics just this once as water is not something one can play the fool with. Imagine if our taps run dry. The crisis that would follow would be the “Mother of all Crises”.

Please Tan Sri, don’t allow this to happen and act fast before it’s too late.

Datuk Seri Azman Ujang is a former editor-in-chief of Bernama. Comments: letters@thesundaily.com

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