Selangor Blocked Capex Because Syabas Did Not Fulfil 2004 Agreement


SHAH ALAM, 16 JAN: The State Government has blocked the Capital Expenditure (Capex) because the Selangor Water Supply Company (Syabas – Syarikat Bekalan Air Selangor) allegedly failed to comply with procedures set out in the Water Prioritisation Agreement Act 2004.

The concession company allegedly did not use the open tender system in appointing contractors for maintenance works and reparations of the water distribution system.

Instead, claimed Chief Minister Tan Sri Abdul Khalid Ibrahim, Syabas used the direct grant method which according to the National Auditor General’s Report, was not recommended.

Abdul Khalid also said that Syabas failed in efforts to reduce the rate of non-revenue water (NRW) to 15 percent as agreed in the 2004 water privatisation agreement.

Abdul Khalid said that the State Government has the right to not approve Capex because the reparation works endeavoured by Syabas was done towards water services assets owned by Selangor.

Abdul Khalid said that the application and usage of Capex must follow procedure which is through the open tender process and not direct grant as it involves State Government funds.

“In some cases, the State Government is ready to use state funds for Capex but it must be in accordance with established procedures,” he said.

He said that Syabas was also criticised by the Auditor General’s report for not using the open tender process by saying that it was not wise to use.

Abdul Khalid said this when answering reporters’ questions during a press conference at the State Secretariat Building today.

In the meantime, Abdul Khalid claims that Syabas failed to produce a short and long term plan to identify areas with a high rate of NRW.

NRW is water that is lost during the distribution process due mainly to leaking pipes or theft.

Until now, Syabas has still failed in reducing the NRW levels from more than 30 percent to 15 percent as per the 2004 agreement.

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