‘Assumptions’, MB Khalid says of Rafizi’s water deal objections

(MM) – Tan Sri Khalid Ibrahim brushed off today claims of illegality and higher tariffs made by Rafizi Ramli concerning Selangor’s water agreement with Putrajaya, saying the complaints were based on mere “assumptions.”

The Selangor mentri besar told reporters today he is seeking approval from Putrajaya to allow the contents of the deal to be made public and dispel further misconceptions about the secretive arrangement.

“I think for now these are assumptions… which is why we will be making several explanations soon,” he said, adding that it was in Selangor’s interests to ensure proper access and understanding of the newly-minted deal.

Khalid said he would meet with representatives from the federal government tomorrow to discuss “releasing” the documents to the public.

He also denied Rafizi’s claims that the deal would lead to an increase in water tariffs statewide, stressing that the reason why the agreement was done was to prevent a hike in water rates.

“The reason why the restructuring exercise was done was to cancel Syarikat Bekalan Air Selangor Bhd’s (Syabas) water tariff increase,” the Port Klang assemblyman explained.

Earlier today, PKR’s Rafizi alleged that the hastily signed memorandum of understanding (MoU) between Selangor and Putrajaya was not only lopsided and possibly illegal, but will inevitably lead to a spike in water tariffs statewide.

The PKR chief strategist said such deals must be presented to the state executive council before they are agreed upon and cannot be left to the unilateral decision of the chief minister.

Under the MoU, Selangor will take over the operations of four water concessionaires — Syarikat Bekalan Air Selangor Bhd (Syabas), Puncak Niaga Sdn Bhd (PNSB), Konsortium Abbas Sdn Bhd and Syarikat Pengeluar Air Selangor Holdings Bhd (Splash) — for RM9.65 billion, and will place these under the state-owned Kumpulan Darul Ehsan Sdn Bhd (KDEB).

Rafizi said the state government’s takeover of water assets would be funded by federal-government-backed bonds.

The deal also says that the land and water assets will be leased back to the state’s water supply operators. And in order to meet debt obligations arising from the bond issuance, the rental rates on the lease may have to rise.

The higher rental would translate into higher water tariffs, he predicted.

Rafizi also said the deal was lopsided, citing key terms that only bind the state government.

According to the MoU, construction of the long-opposed Langat 2 treatment plant is deemed “binding and irrevocable”, while the valuation of water assets is still subject to negotiation, he said.

Rafizi said that Khalid needs to explain the deal in greater detail to ensure that the state government had not been shortchanged.

Khalid has been summoned to explain the water deal to PR de facto chief Datuk Seri Anwar Ibrahim some time this week.