What’s The Issue

In 2012, water cuts and rationing have been imposed by SYABAS, the water distribution company in Selangor

• SYABAS had complained that it lacks treated water
• Federal government (FG) is warning there will be water shortage in Selangor in 2014
• Selangor state government (SG) wants to give free water to the people, however SYABAS is in the way

What’s The Problem

• There is enough (raw and treated) water for Selangor and KL’s usage
• 4,411 MLD of water treated and distributed vs 2,944 MLD used (MLD – millions of litres per day)
• The difference is Non Revenue Water (NRW –  amount of water not accounted for or lost) by SYABAS is 32 %
• A big amount of the NRW is not billed by SYABAS (i.e. ‘stolen water’), the rest due to leaking pipes
• Water matters is fragmented i.e. no one is in control of the water industry
• SG supply the raw water, 3 private companies treats the water and SYABAS distributes the water

What’s Happening

• SG wants to takeover all the water concessionaires (PNHB, SPLASH, ABASS) and SYABAS
• The water concessionaires have debt of around RM 6.4 billion
• PNHB and SYABAS have resisted takeover by SG and FG is helping them in blocking the takeover.
• SYABAS was to increase water tariff by 37% in 2009 and 25% in 2012. SG blocked it
• SYABAS is suing SG for RM 1.05 billion for the lost tariff revenue due to the tariff increase deferment.

Federal Government Plans

• FG wants to build Langat 2 water treatment plant at a cost of RM 8.65 billion to increase the treated water supply
• Water tariff rates for Selangor and KL users will increase if Langat 2 goes through as SYABAS will bear the cost of the project
• FG gave an interest-free and unsecured loan of RM 320 million to SYABAS in 2009
• FG is planning another RM 6.5 billion to take-over the concessionaires’ debts (i.e. bail-out)
• SYABAS needs to replace 6000 km of pipes at a cost RM 2.33 billion in 2011. FG has rejected it (12 July 2012, The Star)

Some Facts

• Puncak Niaga Holdings Bhd (PNSB) owns 70% of SYABAS. PNHB is 40% owned by Rozali Ismail
• Rozali was the former Selangor UMNO treasurer and is closely linked with BN.
• Rozali is ranked the 37^st richest man in Malaysia (March 2011, Forbes).
• SYABAS purchased pipes from an Indonesian company connected to Rozali in 2005, without open tender and defied FG’s order to source from overseas supplier (Lim Kit Siang parliament speech, June 2005)
• PNHB paid RM 8.4 million to one of its directors in 2011, despite making a loss of RM 75.2 million that year.