Wednesday, 17 June 2015

LIFTING OF LAW NO 17/2014 WOULD NOT AFFECT PIPELINED DRINKING WATER SUPPLY



The process of supply of drinking water was believed not be disturbed by lifting of Law no 7 year 2014. In spite of change of policy on local or foreign companies in running drinking water supply system (SPAM) the Regulation did not prohibit participation of private companies. M. Natsir, the Director of Drinking Water Development, Dir Gen Cipta Karya disclosed the matter in Jakarta on Tuesday (19.5).

Broadly speaking, Natsir said, the change of policy in drinking water management with lifting of UU No. 7/2014 was drinking water companies not being permitted to possess drinking water industry. In this case private companies were no longer permitted to manage drinking water industry from upstream to downstream. Soon permit for water tapping would only be given to state owned companies, i.e. the appointed BUMN and BUMND in this case PDAM. This company also served homes networking for low income people. While clean water reservoirs and networking was don in collaboration with private companies.

So there was Government responsibility to inspect and control. It was different from what happened so far where contract between local Government and the private sector had no underlying standard. By the new regulation there would be standardization in contract making. Furthermore tariff must be set by the Government. The relationship with private sectors was only a matter of appointment.

In case of fulfilling the need of water itself, BPSD mentioned that resources was safe until 2013 whether through pipelining or non pipelining had reached 67.7% of total Indonesian population. Of that amount 20% was pipelined, the rest through unprotected non pipelining, in 2014 the percentage of fulfillment of drinking water had exceeded the target set at 68.8% in 2015

Meanwhile the Government program till 2019 was to increase access to clean water to 100%; in which 60% were from pipelining, and 40% from non pipelining. To meet the 100% target an investment of Rp.253 trillion was needed. Of that total need, the APBN fund pipelined through Cipta Karya of the Ministry of Public Works was Rp.33.9 trillion or 11% - 12% of total need, while the fund needed for clean water through the Government was Rp.18 trillion or around Rp.54 trillion in total.

The total amount of fund was far from total need, therefore it was expected that the rest would be filled by APBD by province or city on grant basis. Other fund resources was from APBN and the Ministry of Finance or from banks from company’s CSR program hopefully around 8% - 10%. (SS) 

Business New - May 22, 2015

1 comment:

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