It’s On, Free Water From June

The Star, Thursday June 12, 2008
By EDWARD RAJENDRA

SHAH ALAM: Selangor residents will get to enjoy the first 20 cubic metres of water free after all from June now that the state government has agreed to conditions set by water concessionaire Syarikat Bekalan Air Selangor Sdn Bhd.

State investment arm Kumpulan Darul Ehsan Bhd (KDEB) and Syabas sealed the deal in just 50 minutes yesterday to resolve months of disagreement over the matter.

Mentri Besar Tan Sri Khalid Ibrahim said the issue was settled along a plan where KDEB would compensate Syabas RM1.8mil a month for the 1.1 million consumers to get that free water.

KDEB had earlier wanted to compensate Syabas after the water industry restructuring in September.

KDEB owns 30% of Syabas which has a 30-year concession to distribute water to consumers in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya.

Yesterday, KDEB president Datuk Abdul Karim Munisar, Syabas chief executive officer Datuk Ruslan Hassan and Khalid held a discussion where the terms and conditions were resolved.

On Monday, Ruslan had said in a statement that the company and the state investment arm KDEB could not agree on “terms and conditions” over how the free water was going to be compensated.

He added that Syabas could not accept KDEB’s offer to compensate the company for the free water in September after the proposed restructuring of water services in the state and wanted payment to be done in 14 days.

Further to that, he said the proposal would have adversely affected the water concessionaire’s cash flow and daily operations, so Syabas continued to charge for the first 20 cubic metres of water until it received favourable terms from KDEB.

Khalid said the cost of the free water would be borne by KDEB, the state’s business arm.
“You must understand that it is the first time such an endeavour is being done to give free water.

“So, there were certain terms that had to be clarified."

“We had to resolve the issue of how the billing would be carried out, the compensation issue and settlement of payment with Syabas,” said Khalid.

He added that there were three phases to the understanding with KDEB and Syabas.

“First phase is the billing exercise, the second is the restructuring of water industry in Selangor and the third is to restudy the allocation of funds and the water pricing as it had to take into account the change of economics,” he added.

Ruslan when met after the press conference said Syabas was in agreement with the understanding achieved in the 50-minute discussion.

“We will go ahead with the billing and consumers will receive their bills with the rebate,” he said.