"It's absolutely not true" - this was the rebuttal from water expert Charles Santiago over the government's announcement yesterday that the water privatisation plan has been scrapped.

He said although the plan has been shelved at the federal level, he was concerned whether it will be given the green light at the state level since the state governments had announced their intention to privatise water services.

For example, he said, the Perak state government had announced in January this year that it will privatise the water management in the state and raise the tariff between 20 to 40 percent.

The Negeri Sembilan government had also announced the water privatisation plan while open tender for a water operator was underway in Pahang, according to Santiago.

Energy, Water and Communications Minister Dr Lim Keng Yaik yesterday said the water supply services will remain under state governments, while the federal government will set up a regulatory body to oversee the industry.

"His statement actually opens up the floodgates for other state governments to privatise their water services," he told a press conference at the Parliament lobby today.

"We can only be assured the water privatisation plan is scrapped after the minister gets all the state governments to agree that they are not going to privatise their water services."

Learn from the best

Santiago reiterated his call on the government to adopt the public-public partnership approach currently being implemented by the Penang Water Supply Corporation, in which the state government is the major shareholder of the corporation and the rest are owned by consumers.

The economist pointed out the misconception that the approach could only be practised through privatisation. He said the approach was indeed meant to "learn from the best practices".

"For instances, Perak (a corporatised water entity) does not need to follow the Penang experience because Perak had made RM49 million of profit (from the industry) in 2003 and 2004, but it has to look at other aspects of reforms," he noted.

Santiago clarified that the government has never initiated any consultation with non-governmental organisations (NGOs) but such efforts were initiated by the opposition.

Santiago, who led the 'Coalition against Water Privatisation' comprising of 26 NGOs, said his group would continue the lobbying until the state governments stop their efforts to privatise water.

He revealed that a campaign will be held in Bruas - Keng Yaik's constituency - this weekend to garner support among the constituents against the privatisation move.

'Unique operator'

Meanwhile, Parliamentary Opposition Leader Lim Kit Siang who was also present expressed doubt on the minister's statement yesterday.

He asked whether the government "was conducting privatisation of the water services without using the word privatisation", adding that Keng Yaik's argument over the Federal Constitution amendment did not help to enhance his credibility.

"There is great wariness among the NGOs and the civil society as to whether Keng Yaik is telling the whole truth that his ministry is adopting the NGOs' case for water management," he said, but said he welcomed the 'no privatisation, no federalisation' announcement nonetheless.

Kit Siang also described the minister as "quite a unique operator" where he said the latter could accept the recommendations of the NGOs without the NGOs' knowledge that they had to stage a 90-minute protest outside Parliament yesterday.

Explaining on the about-turn yesterday, Keng Yaik said his ministry "changed strategy" after holding a series on consultations with industry experts, state governments and NGOs during which he found out that the two models proposed were not suitable for use here.

He conceded that he had said water supply services would be privatised or federalised at a consultative meeting organised by the Federal of Malaysian Consumers Association in July last year.