Water bodies not performing: Report

The Jakarta Post, Jakarta

One-hundred-and-sixty local-government water firms (PDAM) in Indonesia, or about 75 percent of the 223 audited by the Development Finance Controller (BPKP), performed poorly this year.

The BPKP says in a report that the firms suffered total losses of Rp 1.2 trillion (around US$138 million) from water leakage, while some of them had difficulties in repaying their debts, which cumulatively stood at Rp 5.6 trillion as of the end of 2006.

The report said that water loss this year, as in other years, was the result of broken meters, leaking pipes, maladministration, illegal connections and the absence of central distribution meters.

Besides the 223 firms that were audited, the country has another 165 local-government water companies that were excluded from the BPKP audit.

Godman Ambarita, the executive director of the Indonesian Water Supply Association (Perpamsi), which represents local-government water firms, told The Jakarta Post on Tuesday that water leakage from all of the country's public-sector water companies averaged 35 percent of total production.

Godman said that of the country's 388 water companies, only 30 of them, or 10 percent, made profits amounting to 20 percent of their cash flows, while total borrowings were estimated at around Rp 6 trillion as of the end of 2007.

Godman said that in line with the Millennium Development Goals (MDG), Perpamsi had organized workshops and training events with support from the World Bank to help improve water supplies and management.

"As part of the effort to increase water supplies, we held a workshop on asset management to reduce water leakage by 20 percent by 2015," he said.

Meanwhile, to improve the performance of companies, Godman said the association planned to encourage the merger of firms operating in the same administrative regions, such as in Banten province.

He added that the preparations for the merger of water firms in Banten, which commenced in 2005 in cooperation with VNG International of the Netherlands, were expected to be finished next year. (nkn)