Public-public partnership for water management proposed
Beh Lih Yi
Jul 31 2004
The government should consider a public-public partnership (PUPs) approach as an alternative option in managing water resources in the country, said economist Charles Santiago.
He told a forum entitled 'Is Malaysia ready for privatisation of water resources' in Kuala Lumpur today that PUPs is an arrangement that could ensure water management continues to be under state and public control at the same time.
Among others, the approach can also ensure efficiency in the provisioning of water services including decreasing the non-revenue water, providing affordable and accessible water for all, ensure water quality and the accountability of the water corporation to the public.
Model for PUPs
Santiago, who is also the Monitoring Sustainability of Globalisation director, said the Perbadanan Bekalan Air Pulau Pinang (PBA) is a model to build a public-public partnership for other state water providers.
According to him, the PBA is a privatised entity but the ownership of the company is largely in the hands of the state government.
The state owns approximately 75 percent of the company, five percent oft he company has been sold to PBA workers and the remaining 20 percent are equally distributed to PBS consumers in Penang and the public.
The chairperson of the PBA is Penang Chief Minister Dr Koh Tsu Koon, which means the state can still exercise political control of the PBA in the interests of consumers.
"Put differently, the people of Penang can exercise their entitlement or right with the state and the state has an obligation to meet the demands of its people," Santiago said.
Nonetheless, he pointed out there will be no 'entitlement-obligation' relationship between the people and the state if the state authorities decide to sell its stake to private capital.
"People will not be able to claim entitlements vis-a-vis the markets and the markets have no obligation to the people," he explained.
Most efficient The PBA's water tariffs are the lowest in the country, it also has the lowest non-revenue water in the country of 18 percent and it is the highest profit making water body in the country with an annual profit of RM50 million.
Santiago described PBA has one of the most efficient monitoring of water distribution system in the country and able to provide water in an effective, efficient and affordable manner.
"Therefore, the appropriate lesson for Malaysia would be to learn from PBA in terms of operation, management, distribution, billing, reduction of non-revenue water and still keep the management and control of water resources in the hands of the state and public control," he argued
About 200 participants took part in the forum jointly organised by Era Consumer, Federation of Malaysia Consumer Associations and the Selangor and Federal Territory Water Watch. Energy, Water and Communications Minister Dr Lim Keng Yaik officiated at the event.