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PAM Jaya to negotiate contracts to provide poor with tap water
City-owned water operator PT PAM Jaya is planning to renegotiate contracts with two private operators â PT PAM Lyonnaise Jaya (Palyja) and PT Aetra Air Jakarta (Aetra) â to allow PAM Jaya to construct new connections in the city
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ity-owned water operator PT PAM Jaya is planning to renegotiate contracts with two private operators ' PT PAM Lyonnaise Jaya (Palyja) and PT Aetra Air Jakarta (Aetra) ' to allow PAM Jaya to construct new connections in the city.
PAM Jaya president director Sriwidayanto Kaderi said recently that due to the Constitutional Court's (MK) ruling on water resources, the city administration was obliged to be actively involved in fulfilling the right to water of the Jakartans, especially low-income families (MBR).
'Therefore, we will renegotiate the contract with both companies to allow us to build connections for MBR,' he said.
The contracts made in 1997 between PAM Jaya and two companies ' Palyja and Aetra ' stipulate that the right to operate water in Jakarta is exclusively controlled by the two companies. Palyja manages the west side of the city while Aetra manages the east side. Meanwhile, PAM Jaya is only a regulator.
Sriwidayanto said, however, that the two companies had been slow in increasing the tap water coverage, causing many residents, in particular the low-income households, to miss the tap water service. 'Only around 60 percent of residents have enjoyed the service,' he said.
The director said the city administration wanted to speed up increasing the service range. '[Jakarta Governor Basuki 'Ahok' Tjahaja Purnama] targets to cover 90 percent of the residents in 2019,' he said.
Sriwidayanto said his team was now beginning to open up the option to both operators. 'We will also try to renegotiate with Palyja on other matters,' he said.
According to him, while waiting for the result of the negotiation, PAM Jaya was planning to make new connections in 1,200 households in Muara Baru low-cost apartments in North Jakarta.
'We also plan to do the same thing in Bintaro in South Jakarta, Tegal Alur in West Jakarta and Kamal Muara in North Jakarta,' he said.
Sriwidayanto said his company would ask for the government to participate in investing up to Rp 300 billion
(US$22.6 million) to the city administration in 2016.
He added that the company estimated it needed around Rp 6 trillion to Rp 7 trillion to reach the target of 90 percent coverage.
The director of potable water development at the Public Works and Public Housing Ministry, Mohammad Natsir, said his ministry called on the city administrations to reexamine and renegotiate the contracts with private operators.
'We need to ensure that the government exists to fulfill the clean water needs of residents,' he said.
Natsir said the MK ruling was not anti-private. 'However, most of the projects should be handled by either state-owned companies or city-owned companies,' he said.
Aetra corporate secretary Pratama S. Adi said his company had not received any formal request from PAM Jaya to renegotiate the contract.
'We will discuss the matter further when the request has been delivered,' he said.
Regarding the poor community's access to water, Pratama said his company never differentiated the customers. 'We always try to fulfill the request for new connections from the customers,' he said.
He added that as of December 2014, the number of Aetra customers was 407,000 and the company targeted to add 37,000 more.
Palyja spokesperson Meyritha Maryanie said her company was also open for renegotiation. 'The contract stipulates that we have to rebalance and rebase the contract every five years,' she said, adding that contract rebalancing for the 2013-2017 period had not been conducted.
Different from Aetra, Palyja refused to rebalance and rebase its contract in 2012.
