Penang insists water rates still ‘lowest’ in country

By Shazwan Mustafa Kamal

Malaysian Insider
November 03, 2010

Lim explained that the water surcharge was designed to encourage water conservation. — file pic

KUALA LUMPUR, Nov 3 — Penang Chief Minister Lim Guan Eng today defended the state’s increase in water charges, saying tariffs there remained the “lowest” in the country despite the hike.

Lim also dismissed state opposition party Gerakan’s allegations that the administration’s decision to raise water tariffs by 27 per cent would burden households with more than five family members.

“After the water increase, the water domestic rate in Penang is still the lowest. For domestic rates you only have to pay [more] if you use above a certain limit. If you use up to 35 cubic metres, it is still the same, it’s just that [for] anything above that there is a surcharge,” Lim told The Malaysian Insider today.

The chief minister took great pains to explain that the rationale for the surcharge was to prevent water wastage, claiming there would be no motivation to conserve water if prices were maintained below production costs.

“Even in the case of water for businesses, we are still the second-lowest in the country, after Terengganu. If water is too cheap, people will tend to waste. What we want to do is to put it slightly above production costs, as it is now below production costs,” said Lim.

The Penang Pakatan Rakyat (PR) administration has come under fire from Barisan Nasional (BN) state opposition parties, who have embarked on a campaign to discredit the state government over the move.

Penang Gerakan vice-chairman, Wong Mun Hoe, claimed on Monday that the hike in state water prices would burden Penang folk and have long-term implications to households with more than five family members.

“According to our research, a family with more than five members will incur an average increase ranging from RM8 per month to about RM100 a year,” he said, adding that the rise would also affect small businesses, traders and even investors who required water in their business activities.

Wong further claimed the profits of Perbadanan Bekalan Air Pulau Pinang (PBAPP) had dropped to RM31.2 million in 2008 and RM14.8 million in 2009, while under the PR state administration.

PBAPP’s profits had been RM43.1 million in 2007, when the state was still under BN, according to Wong.

Yesterday, a group of 100 people representing Balik Pulau residents, Komtar traders and Parti Cinta Malaysia members held a demonstration in front of the Penang state assembly to protest against several issues, including the water tariff hike.

There, they had demanded a meeting with Lim but were denied entry into the state assembly.

“I don’t mind discussing matters with the protestors. But these protestors are Umno people, trying to create havoc and chaos,” the chief minister said today.