No Water Tariff Increase! Reform Water Management First!

by Sivarajan, PSM Secretary General

17th April 2019

 PSM is troubled by the recent announcement by Xavier Jayakumar, the Minister for Water, Land and Natural Resources that six states have agreed to increase water tariffs after discussion with himself.

What has the Pakatan Government done to reverse the massive privatization policies that were embarked on in the 1990’s under Barisan Nasional (BN)? Water privatization exercise under the BN government has only served to create a rent seeking class that profits from the treatment and distribution of water to households in Malaysia.

Even though through the Water Services Industry Act WSIA of 2006, the government attempted to nationalize all water assets and put in under the Federal Government control , but till today much of the water treatment and distribution remains in the hands of private entities. Xavier Jayakumar should not echo the demand by the private operators as private profits seeking entities will naturally work towards increasing their profitability in the business. PSM is concerned that Pakatan Harapan is continuing Barisan Nasional’s legacy that conceived water as a commodity and not as human right to be safeguarded by the government.

As long as the Minister and Suruhanjaya Pengurusan Air Negara (SPAN) maintains the current privatized water management model, they are forced to adhere to calls by the private operators for the government to provide assurance of their returns and profitability of their investments.

This is revealed when Xavier was reported as saying“We will see what we can do so that the people are not burdened, but at the same time, the water industry has to move forward.

Will the Minister justify a tariff increase citing a supposedly ‘win-win’ situation between private profits and people’s interest?

The Selangor water saga clearly proved the nightmares of privatization, when the state wanted to buy all water assets in order to gain control over state’s water distribution rights so that it can continue to provide 20 cubic meters free water. The State government was entangled in a long tug-of war with private concessionaires over disagreements of valuation methods used for their assets.

PSM demands that there should not be any increase in water tariffs without an overall reform of our water management structure. Privatization has only enriched private concessionaires and further tied the hands of the government to ensure water rates do not burden the poor. PSM calls for an immediate reform from the privatization model. We need to democratize decision making on the nations water management. The Ministry should initiate town hall meetings and stakeholder consultations to gather feedback on the way forward to ensure water supply remains a human right and not a commodity.

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