The arrogant attitude shown and the irrelevant explanation given by Puas CEO Mohd Sinon on the high water tariff levied on residents of Greenview Apartments as reported in malaysiakini did not go down well with the affected residents. They are not to blame for Puas' losses which run into hundreds of millions of ringgit.

Interpretation problem of the tariff code aside, Mohd Sinon categorically stated that, as Puas paid 82 sen per cubic metre of treated water to the suppliers, it could not sell it for 70 sen per cubic metre, which the residents of Greenview Apartments were demanding based on their interpretation of the tariff code.

Taking it from there, even at the rate of RM1.20 which Puas is charging the residents of Greenview Apartments, Puas' operations would still be very much in deficit after taking into account losses due to non-revenue water (NRW) and the costs of water distribution and billing.

Considering NRW alone, which accounts ofr over 40 percent of supply, the cost of water reaching consumers' taps would amount to RM1.37 per cubic metre (82 sen divided by 0.6). If we include Puas' operational costs, the cost of water will be much higher than 82 sen.

And based on the current water tariff structure, the average rate for domestic supply in Selangor is 72 sen per cubic metre and for industrial supply is 191 sen per cubic metre. The weighted average water tariff is worked out to be 107.70 sen per cubic metre (72 x 0.7 + 191 x 0.3). This weighted average tariff is 27 percent less than the cost of treated water after taking into account only the loss of revenue through NRW.

It is no wonder that Puas is facing a deficit of up to RM400 million annually, and is in arrears of RM1.2 billion owed to privatised water treatment plant concessionaires.

Mohd Sinon also stated that the Selangor water tariffs are low compared to the electricity rate. Unfortunately he was comparing oranges with apples. According to the statistics in Malaysia Water Industry Guide 2003, the Selangor's average tariffs for domestic and industrial consumption in 2001 are ranked second highest in Malaysia.

In Penang, where water tariffs are amongst the lowest in Malaysia, the state water supply company, Perbadanan Bekalan Air Pulau Pinang, has been able to make profits all these years.

Mohd Sinon attributed the annual deficit to high costs of constructing water treatment works. This is pulling wool over the public's eyes.

In fact, one of the major factors that cause Puas' huge annual deficits is the privatisation of more than 30 water treatment plants. The Selangor government, by the terms of the concession agreements, is purchasing all treated water from concessionaires at a prohibitive prices.

So, who is being made to take the blame for Puas' hefty annual deficit? One wonders why the Selangor government has set up Puas as a corporation tor run a losing business.

Finally, the straw that broke the camel's back was Mohd Sinon's uncompromising stance on the issue when he told residents of Greenview Apartments to refer the matter to the courts if they were not happy with the tariffs.

It is hoped that the Resident Association of Greenview Apartments will not only just do that but also take up the case against Puas for supplying water that is not wholesome and not fit for human consumption.