Finally, 25 Years Of Privateization Of Water Jakarta Officially Ended

JAKARTA - Today is a new history for the DKI Jakarta Provincial Government in carrying out clean water services for its citizens. As of February 2, 2023, water services in the capital city are fully controlled by the government.

Perumda PAM Jaya as a business entity owned by the DKI Provincial Government officially terminated the cooperation contract for water management or water privatization with two private partners, namely Palyja and Aetra.

Water privatization began in 25 years ago. On June 6, 1997, PAM Jaya signed a collaboration with PT Garuda Dipta Semesta with Lyonnaise desaux (now Palyja) and with PT Kekarpola Airindo with Thames Water Overseas Ltd (now Aetra).

During the 25 years of water management, Palyja and Aetra carried out water services oriented to profit. What happened, water services became uneven in Jakarta.

Some time ago, the Director of Anti-Corruption of the Corruption Eradication Commission (KPK) Aminudin said that his party received data that related private partners were relatively underperforming on the downstream side, namely the occurrence of pipe leakage rates which had an impact on service coverage to the population being low.

In addition, PAM Jaya is also noted to have suffered losses because it has to pay its obligations to the private sector. Meanwhile, the coverage of water pipelines in Jakarta has also not increased optimally.

"Metode take or pay with problematic downstream conditions has the potential to harm PAM Jaya because it is obliged to pay 100 percent of water production from private partners. In fact, effective water distribution is only 57.46 percent," said Aminudin on April 22, 2021.

Until finally the DKI Provincial Government decided not to extend the water privatization contract. From there, since the past year, PAM Jaya formed a transition team that planned the readiness of this regional-owned company to carry out water services completely.

On its way, PAM Jaya again collaborated with the private sector, namely PT Moya Indonesia regarding the implementation of a drinking water supply system by optimizing existing assets and providing new assets with a bundling financing scheme.

However, the President Director of PAM Jaya emphasized that this new collaboration is different from water privatization with Palyja and Aetra. In the previous agreement, partners carried out management from upstream to downstream. Meanwhile, this cooperation is only carried out in the production department.

"The distribution and customer service are fully carried out by PAM Jaya. PAM Jaya has the right to stop cooperation with its partners," said Arief on October 14, 2022.

He explained, as of February 1, 2023, PAM Jaya has ensured that 5 important elements have been fulfilled, namely the availability of full operation organizational structures that accommodate partner employees including positions and positions, the availability of human resources that are ready to carry out full operations, the availability of business processes for managing SPAM that will be run, the availability of systems and applications that are ready to be used for full operation, as well as the availability of operational and service supporting tools and materials.

"We certainly want the transition process and full operational transformation of piped water by PAM JAYA to continue smoothly, but remain in a transparent principle and based on good corporate governance," he said on Wednesday, February 1.