Final water deal to go ahead even as Selangor MB impasse festers

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(September 10): The final agreement to restructure treated water services in Selangor is expected to be signed as early as tomorrow even as questions are raised about whether the contract is legitimate as the menteri besar is expected to be changed soon.

Sources involved in preparing the deal told The Malaysian Insider that Putrajaya and the Selangor government will sign the master agreement despite a Selangor lawmaker questioning the legitimacy of the agreement ahead of Tan Sri Abdul Khalid Ibrahim's replacement as MB.

The master agreement details all steps taken by Putrajaya and Selangor to de-privatise the industry and return it to the public.

Selangor is also expected to sign agreements to buy over control in three of the four companies that currently treat and distribute a significant amount of the 3,900 million litres a day that is used by about 7 million people.

The three are Puncak Niaga Sdn Bhd (PNSB), Syabas and Abass, which will be taken over by state-owned Kumpulan Darul Ehsan Berhad.

PNSB and Abass operate several water treatment plants while Syabas is responsible for the distribution system.

The previous two memorandums of understanding which initiated the deal were signed after the state exco meetings on Wednesdays.

On August 1, Selangor and Putrajaya signed the heads of government agreement that sealed the exercise.

Under the deal, Putrajaya would assist Selangor in de-privatising the industry and returning it to state control, while Selangor is to approve Putrajaya's RM3.6 billion Langat 2 water treatment plant project.

Pakatan Rakyat had promised voters in the 13th general election that it would complete the restructuring of Selangor's RM20 billion industry if given a second mandate.

The coalition claimed that the privatisation of the water industry to companies controlled by Umno-linked businessmen had caused supply disruptions and leakages, despite the fact that water rates had to be raised every few years.

Yet the wording of the agreements signed by Khalid to implement the exercise had been criticised by leaders of his own party PKR and ally DAP.

They claimed that the agreements extracted too many binding commitments from Selangor towards Putrajaya, but lacked guarantees that the operations of the industry would return permanently to public hands.

Klang MP Charles Santiago yesterday questioned whether the final agreement should be inked at all given that Khalid is now a caretaker MB, after his resignation was deferred pending the Selangor Sultan's decision on a new MB.

“Signing the agreement in the midst of a change in administration could lead to questions of moral and legal legitimacy, especially since there has hardly been any openness and transparency in the negotiations so far.

“It should, instead, wait for the new Selangor leadership to be sworn in, in the interest of good governance and accountability,” he said.

Khalid was expelled from his party PKR early this month after he refused to heed his party's directive to vacate the MB seat for Datuk Seri Dr Wan Azizah Wan Ismail.