Jan 17, 05 6:01pm Barisan Nasional (BN) backbenchers today aired their concern over the possibility of an immediate increase in water tariffs, despite being assured otherwise, when the management of water supply is taken over by the federal government from state governments in Peninsula Malaysia.
The ruling parliamentarians expressed their views aired during the three-day special Parliament sitting, which began today, to debate the Constitution Amendment Bill 2004. The main amendment proposed was the transfer of power for supply, treatment, distribution and billing of water supply to the federal government.
During the debate, Mohamad Aziz (BN-Sri Gading) asked how can the government and the proposed National Water Services Commission (Span) ensure there would not be a hike in water tariff.
Citing the widely-opposed 10 percent toll fare hike last December, he argued that the government had allowed the hike despite being empowered to intervene and review the toll fare.
The vocal parliamentarian said the people had been “fooled” by that incident.
“Many excuses could be used to increase the water tariff in future. None of the ministers were bold enough to give an assurance that the tariff will not be raised in the briefing for parliamentarians yesterday,” he added.
Two-year moratorium
Energy, Water and Communications Minister Dr Lim Keng Yaik told reporters yesterday after the briefing that the government will not raise the water tariff for at least two years.
He said any change to the existing tariff would only be decided after the two-year moratorium and after the concessionaires had proven their efficiency to be on par with the benchmark to be set by Span.
The minister also warned water supply concessionaires that the government will not compensate nor bail them out if they fail in their operations.
Dr Wee Ka Siong (BN-Ayer Itam) was also sceptical of the assurance since the debts of state governments in regards to water run into the billions.
It has been previously reported that the Selangor state government had requested a RM2 billion soft loan from the federal government to pay some of its debts to Puncak Niaga Holdings Bhd.
“How could we be assured there will be no (immediate) increase when the debts have yet to be cleared?” he asked.
To date, state governments in Peninsula owe the federal government RM7.5 billion as far as water is concerned.
Unveil full plan
Sharing similar concern, Liow Tiong Lai (BN-Bentong) requested the government to unveil its full plan in dealing with the RM7.5 billion debts and asked if Span would absorb the debts.
He also wanted Span to exercise its full authority in monitoring the water tariff while welcoming the establishment of the water services commission.
On Span, Mohamed Razali Che Mamat (BN-Kuala Krai) called on the government to appoint water specialists to sit in the commission to contribute their professional knowledge.
The MP said Span should not follow the footsteps of the national power utility Tenaga Nasional Berhad (TNB), which is now under fire for last Thursday’s power outage in five states.
According to him, none of TNB’s directors have any expertise in that field.
Best solution
Meanwhile, tabling the Constitution Amendment Bill 2004 this morning, Minister in the Prime Minister’s Department Mohd Radzi Sheikh Ahmad said the state governments were facing difficulties in clearing the RM7.5 billions debt.
He pointed out that despite the huge allocation, it was insufficient to cope with the water industry’s operation cost and high modal is needed to upgrade the present infrastructure.
He said the transfer of power from state governments to the federal government would be the “best way” to tackle various long standing problems surrounding the industry such as the high rate of non-revenue water and poor governance.
This is in spite of the significant financial implication on the federal government side, he added without elaborating.
Apart from the water management takeover, the Federal Constitution will be amended to raise judges’ retirement age from 65 to 66 and to effect the conservation of national heritage by both the federal and state governments.
Radzi said the adjustment to the judges’ retirement age was in line with the amendment of civil servants retirement age from 55 to 56 which took effect in October 2001.
The bill is expected to be passed by the Dewan Negara on Wednesday.
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