Water price increase dominates Budget forum

At a Budget forum last night, Ms Indranee said the water price rise - to be implemented in two phases starting this July - is meant to ensure that Singapore has a continued supply of water.
At a Budget forum last night, Ms Indranee said the water price rise - to be implemented in two phases starting this July - is meant to ensure that Singapore has a continued supply of water.ST PHOTO: LIM YAOHUI

Participants ask if there are other ways to conserve water instead of subjecting everyone to 30% hike

The impending rise in water prices dominated a Singapore Budget forum last night, with participants asking if the Government could have adopted other ways to conserve water.

Could a more targeted approach be taken to penalise heavy users, instead of subjecting everyone to a price increase, one asked.

It prompted another participant to observe that the bulk of water is consumed by industries. He also suggested using technology to conserve water.

In response, Senior Minister of State for Finance and Law Indranee Rajah, who chaired the forum organised by government feedback unit Reach, said the price rise is to ensure that Singapore has a continued supply of water.

To achieve it, water has to be priced to ensure it is of high quality, encourages responsible usage and that supply is reliable, she added.

 

She urged the 120 participants to bear in mind that there will be help for those struggling to cope with the 30 per cent price increase, to be implemented in two phases, starting this July. The increase was announced on Monday by Finance Minister Heng Swee Keat, who said in his Budget speech that the cost of water transmission and production has risen over the years.

Ms Indranee added that it is important for people to realise there is a price to the water they use daily.

But the Government will step in to help households cope with the increase in utility bills, she said.

Showing the participants a chart, Ms Indranee said residents living in one- and two-room Housing Board flats now spend about $26 a month on water.

Their monthly bill will go up by $9 when the full increase takes effect. But the Government will hand out $10 in rebates to help them cope.

For residents of four-room HDB flats, their monthly water bill is expected to go up from $42 to $54. But with a $7 rebate, they should see a rise of $5 each month, she said.

"The cost (of water) will go up, we can't avoid that. We have to make sure it is priced in a way to not only ensure sustainability, but also encourage conservation."

As for industries and businesses that use large amounts of water, Ms Indranee hopes the price increase will push them to look for cost- effective ways to do their work.

The Government is also encouraging innovation and technological breakthroughs in the area of water production, she added.

Reach chairman Sam Tan said there were more than 50 days last year when Singapore could not draw water from its main supply source, Johor's Linggiu reservoir.

"It means more and more, we have to rely on our treated water, which is more expensive," he said.

Speaking to reporters later, Ms Indranee said the water price comprises several elements. "It is not all a tax," she said, adding that there are also elements of rising cost in producing and supplying water.

Forum participant Phil Ho, 61, said he hopes the Government will develop the technology to optimise water usage in homes, and educate industries to save water.

"It must be a holistic approach that does not just rely on pricing," said the corporate finance officer.

Meanwhile, Minister for National Development and Second Minister for Finance Lawrence Wong said on Channel News Asia that there is "never an ideal time" for a rise.

But water is a matter of survival for Singapore, and the Government has deliberated carefully before making the increase now, he added.

A version of this article appeared in the print edition of The Straits Times on February 24, 2017, with the headline 'Water price increase dominates Budget forum'. Print Edition | Subscribe