Syabas slaps Selangor govt with RM339m claim

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The Selangor state government has received a letter of demand for RM339 million for its refusal to allow a hike in water tariffs last year.

The compensation claim was contained in a letter from the lawyers of Syarikat Bekalan Air Selangor (Syabas), Selangor Menteri Besar Khalid Ibrahim revealed in a statement this evening. The letter gave the Selangor government 14 days to pay up.

Syabas is 70 per cent owned by Puncak Niaga Holdings Bhd, which is in turn 41 per cent controlled by Puncak Niaga executive chairman Rozali Ismail. According to Puncak Niaga’s Annual Report for 2008, directors’ earnings for the Puncak Niaga group totalled RM11.6 million for the year with the highest paid director earning more than RM5.7 million.

Khalid said the state government had received legal advice that Syabas was not entitled to such compensation. The state government is standing by its position that Syabas had allegedly violated important issues in the concession agreement. The MB said the government was ready to contest the compensation claim in court.

I spoke to Klang MP Charles Santiago about this. He said the Selangor state government was holding to three points:

– both the federal government and the state government have to agree to any tariff increase;
– any tariff increase could only come after the restructuring of the water sector was completed;
– the state government is challenging Syabas’ compliance with the terms of the concession.

Here is the full statement in Malay:

24 FEBRUARI 2010

KERAJAAN SELANGOR SEDIA KE MAHKAMAH BAGI MEMBANTAH KENAIKAN TARIF AIR

Kerajaan Selangor telah menerima surat tuntutan dari Syarikat Bekalan Air Selangor (Syabas) berikutan keengganan kerajaan negeri membenarkan syarikat bekalan air di Lembah Klang itu menaikkan tarif air.

Syabas melalui syarikat guaman Messrs Cheang dan Ariff telah menghantar surat bertarikh 12 Februari 2010 menuntut Selangor membayar sejumlah RM339 juta sebagai pampasan kerana enggan membenarkan tarif air dinaikkan sepanjang tahun 2009.Surat tuntutan itu menegaskan kerajaan Selangor perlu membayar pampasan itu dalam tempoh 14 hari dari tarikh surat dikeluarkan atau berdepan dengan tindakan undang-undang.

Kerajaan negeri telah menerima nasihat dari panel guaman berhubung perkara itu yang mendapati Syabas tidak layak membuat tuntutan sedemikian kerana tiada berhak dan tiada keperluan.

Sehubungan itu, kerajaan negeri akan menghalang sebarang usaha atau cubaan untuk menaikkan tarif air di Selangor.Kerajaan Selangor tetap dengan pendirian bahawa Syabas telah melanggar beberapa perkara penting dalam perjanjian konsesi dan perkara itu diperakui oleh Jabatan Audit Negara. Pelanggaran syarat oleh Syabas telah menyebabkan kerugian besar kepada rakyat Selangor.

Oleh demikian, kerajaan Selangor sama sekali tidak akan membenarkan syarikat itu menaikkan tarif air seperti yang dipersetujui dalam perjanjian konsesi berkenaan.

Kerajaan negeri telah mengemukakan cadangan asal untuk menstruktur semula perkhidmatan air di Selangor yang bertujuan meningkatkan mutu perkhidmatan dan lebih penting bagi mengelak kenaikan tarif air.

Bagi merealisasikan cadangan penstrukturan semula itu, kerajaan Pakatan Rakyat di Selangor telah membuat tawaran yang munasabah untuk pengambilalihan itu supaya Syabas mempunyai sumber kewangan yang mencukupi untuk dijadikan suntikan modal dan membuat pelaburan.

Kerajaan negeri berpendapat, tiada sebab untuk Syabas menuntut bayaran pampasan jika syarikat utiliti itu menerima tawaran yang dibuat kerajaan Selangor.

Kerajaan Negeri menegaskan sebarang keputusan untuk menaikkan tarif air perlu mendapat persetujuan tiga pihak iaitu Kerajaan Negeri, Pemegang Konsesi dan Kerajaan Pusat.

Bagaimanapun, Kerajaan negeri tidak bercadang untuk menaikkan tarif air setakat ini dan akan terus menyimpan hak sebagai pembekal air mentah.

Kerajaan negeri sedia berdepan dengan Syabas di mahkamah jika syarikat itu mahu meneruskan cadangan untuk mengambil tindakan undang-undang. Tindakan kerajaan negeri ini sejajar dan bertepatan dengan agenda “Merakyatkan Ekonomi Selangor (MES) yang diperjuangkan kerajaan Pakatan Rakyat di Selangor.

TAN SRI ABDUL KHALID IBRAHIM

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amoker

Pencinta Air,
You must have seen the secret water agreement signed between Khir Toyo and Syabas. The rest of us have not seen it and perhaps that is why we are so ignorant and blindly not accepting that this is good.

The crisis is now.. with 30% water lost due to improper pipe maintainence that causes leakages. Why charge consumer if the company is not able to do a good job?

Pencinta Air

Ok, Kenaikan berdasarkan konsesi adalah sepertimana yang termaktub dalam perjanjian antara PN/S dgn Kerajaan Negeri Selangor sebelum ini (BN). So, PN/S menaikkan kadar berdasarkan kpd konsesi tersebut. Ia betul! Kerajaan Negeri Selangor tidak membenarkan tarif air naik utk mengelakkan rakyat terbeban itu juga betul dari aspek politik dan moral. Kerajaan Negeri seharusnya berunding dgn baik dgn Syabas bg menangani masalah ini. Apa yg pasti, bekalan air akan berhadapan dgn krisis. Masa yg tentukan. Jd, permintaan utk menjayakan projek Pahang-Selangor Water Transfer juga perlu dinilai dgn baik. Bkn hanya menuduh yg bukan2 kpd PN/S. Inilah masalah bersama & perlu ditangani dgn… Read more »

mut

Hi anil,

This ongoing saga of Syabas is a bit convoluted. I tried looking for a site that addresses the problems since the award of the contract in 2005 but most websites address the numerous problems piecemeal. is there anywhere that I can read the about water privatisation in Selangor in its entirety?

Angela Ooi

Isn’t it great to have Pakatan in Government? No more sweetheart deals where the rakyat have to pay and pay. Stand your ground Khalid, the rakyat are behind you. Going to court and opening the can of worms as to the ‘terms and conditions’ given to this lucrative Company that pays over $5 million to its
director, will be a darn good thing!

tan, tanjong bungah

Hi everyone, “Berani Kerana Benar”. I would give my support to the Selangor State Govt for its stand against tariff increase if based on the stated slogan. I’ve family members in KL and S’gor and I’ve first-hand experience of the inferior quality of water supplied in these places, so much so that installing water filter is a ‘must’ there! Experience the superior quality of water supplied by PBA in Penang, moreover supplied at the lowest rates in the country! Nevertheless, the Penang State Govt is considering rewarding households, which use much less than average consumption of this scarce resource, and… Read more »

Adam

To know how this mess comes about, just trace back to the privatisation of all the major plants in Selangor to Puncak Niaga during the time of M2M and you will get the gory answer.

Most, if not all privatisation schemes in Malaysia, be they for water, roads, power, etc, are taking the poor rakyat for a ride and it is so sad that the government we have voted does not look after our interests but their own personal interests.

Fire melts Iron

Syabas really is such a shame! What? 339 million ringgit? Zimbabwean currency? 339 million ringgit may not be a lot of monies for the State Government of Selangor, but, for a Company, to claim that amount from the State Government? That is absolutely crazy as the PR Government had provened during its two years in Government to be absolutely prudent with all its activities and monies. It had been a highly responsible Government and it had done well in every aspect of Governing, though there are places where they can further improved! Syabas, can very well go to wherever they… Read more »

daniel

PR giving Selangor folks with such rebate (20m3 free water) has been appreciated all over Selangor. So far, anyone that I came across also appreciate such effort shown by the PR. I give both thumbs up for PKR.

Limko

It is time that government elected by the people serves the interests of the people rather than political related parties.

In matter of basic amenities, government is duty bound to provide the best that it could at the least cost. Selangor government shows the people that you can do it.

FenceSitter

Good for the Selangor gomen to fight it out in court. Had this been bn, it would probably have been paid secretly out of the taxpayer’s money.

N

Bravo Tan Sri Khalid for defending what is right for the people in Selangor. I wonder in this case, is the Selangor government being wise in its decision to go against the water tariff? Let me just clarify my point. The refusal to pay the increase in tariff also caused Syabas RM399m and this is not a huge sum. But at the same time, is it not possible for Selangor and Syabas to find a way so that each would benefit. As a leader, it is also vital to look at the welfare of all people/sides being affected in this… Read more »

SamG

Anil, As I have told you PBA is also taking Penang consumers for a ride. Every utility co pay their customers an interest on the Deposit. If you don’t believe me, check your TNB and TM bills for January every year. They would have given you a Special rebate. However, there is no such rebate from PBA. This has been going on for more than 10 years. This is where LGE and PR Govt got the money from PBA to give to the RM100 to each “poor family” in Penang in 2008/09. They could be doing a good job in… Read more »

daniel

i was told SYABAS is (allegedly) just an “ali-baba” company because no assets in the running of the business. Syabas (allegedly) just do billing and collect payment and other related administrations. Water is supplied by few companies, water trucks are belonged to other companies, maintenance works are sub-contract to appointed contractors. Syabas’ collections all dispersed back to their suppliers / contractors and left “peanuts” as profits and even running at loses if the leakages along the main pipes are serious. If this is true, it is unfair to blame Syabas. The main problem is with the suppliers and contractors which… Read more »

whispering9

Yeah….meet and challenge Syabas in court. The last time they increased the water tariffs under KT, they went on an extensive house to house PR stunt to promise clean and clear water as the excuse. On the contrary, the water quality did not improve and like many households we have to upgrade our water filter system and resort to drinking RO water.

Bigjoe

I stay in Wilayah and don’t get free water even though we use less than 20cm3 for years. For donkey years we have been getting dirty water. We have spent a fortune on water filters AND still have to put up with burst pipes and stoppage. We even built an extra water tank at a few thousand RM (can you imagine that I have to built a water thank that pays for 10 years of water use) just to make sure we have enough water that I have to clean periodically because of the dirty water. They want to increase… Read more »

mut

I think this is good, as a resource like water is too precious to just give up to UMNO. What i would like to see happen is the takeover of PLUS as envisaged by the DAP and lamely echoed by MCA recently. The hiway is another entity which should fall under the purview of the government. Besides, it has been paid for many times over already.

CannotImagine

I am from selangor and i am fully support the state gov. show syabas who is the boss.. is the people … state gov is doing a good job to protect the interest of the people of selangor ..

if under bn, sure naik harga already .. thank god

ice

Good one, stand firm on your decision,Syabas can go to hell to get water to sell….