Thursday 9 February 2017

Water prices set to increase for the first time in 17 years; Budget 2017: Water prices to increase by 30% from 1 July 2017 in two phases

Price of water will go up to ensure sustainable supply
Details of first price increase in 17 years to be included in upcoming Budget, says Masagos
By Lin Yangchen, The Straits Times, 8 Feb 2017

For the first time in 17 years, Singapore residents will have to pay more for water, as the nation seeks to ensure long-term water security.

Details of the increase in water prices for both domestic and non-domestic users will be in the upcoming Budget to be announced on Feb 20, said Minister for the Environment and Water Resources Masagos Zulkifli.

He said on a visit to Singapore's partially completed third desalination plant in Tuas yesterday that water has to be priced correctly to ensure a sustainable supply and reflect the scarcity of the resource.

The tariffs for domestic potable water, calculated monthly, stand at $1.17 per cubic m for the first 40 cubic m, and $1.40 per cubic m thereafter, excluding taxes.

The last price increases were introduced progressively between 1997 and 2000, when tariffs went up by 20 per cent to 100 per centon a sliding scale depending on usage.

The cost of producing and supplying water has increased, because of reliable but more expensive methods such as desalination and the need to renew ageing infrastructure like old production plants and pipes.

"In many countries where it is not priced properly, the water ministry is not able to recoup cost enough to build new assets to replace old assets, and sometimes, assets are just left in disrepair to the extent that even though they may have water, the water cannot get to where it is needed," said Mr Masagos.

"Water is a very critical asset that we have to take care of."

Experts have long called for the relatively inexpensive water prices to be raised in Singapore, as this would encourage people to reduce consumption.

Mr Masagos also noted the importance of diversifying water production methods. "If there is a more prolonged dry season affecting the region, Linggiu will actually run out in about two years. And therefore, we always must be ready to ensure that we have enough assets... to supply water to Singapore."

The Linggiu Reservoir in Johor supplies Singapore with up to 250 million gallons of water a day under an agreement with Johor.

Mr Masagos said that even in a worst-case scenario, Singapore should not need to resort to water rationing, due to its diversified sources.

Desalinated water is the most expensive of Singapore's four National Taps - with the other three being imported water, water from local reservoirs and Newater - given the energy needed to extract salt from seawater at high pressure.

Nonetheless, said Mr Young Joo Chye, director of engineering development and procurement at national water agency PUB, it remains a key pillar of Singapore's water supply strategy. "As a source of water that is independent of rainfall, it bolsters the reliability of our water supply against prolonged periods of dry spells and droughts."

Two desalination plants are now in operation here, meeting up to 25 per cent of Singapore's water demand of 430 million gallons per day. Desalination will meet up to 30 per cent of demand by 2030, when at least five plants are expected to be operational.

Water price hike: Water users worried but see need to curb wastage
Some hope increase won't be too much and that Govt will factor in economic climate
By Carolyn Khew and Lin Yangchen, The Straits Times, 8 Feb 2017

Consumers and businesses have voiced concerns about water rates being hiked, even if some acknowledge that there is a need to do so to curb wastage of the scarce resource.

Restaurant Association of Singapore president adviser Andrew Tjioe said he hopes the Government will factor in the present economic climate when deciding on the price increase. "We have other things to take care of like operation costs, which are very high," he said.

Yesterday, Minister for the Environment and Water Resources Masagos Zulkifli said the price increase is meant to ensure the reliability of Singapore's water infrastructure, and to reflect the scarcity of water.

This is the first time in 17 years the price is being increased. The details will be announced during Budget 2017 on Feb 20.

Car-grooming firm Groomwerkz's managing director Tan Thiam Yong said higher prices for water usage could prompt users to be better at conserving the resource. "For us, we have already done all that we can to save water but for those who are not at their optimum, it might prompt them to do so," said Mr Tan.

His company is now looking to recycle 90 per cent of the water used for car-grooming services, including car washing, by the end of the year.

Housewife Ng Kah Kiow, 54, who lives in Toa Payoh, said: "Naturally, we hope prices will not increase, but we understand that costs are going up and water is precious."

Professor Asit Biswas, visiting professor at the National University of Singapore's Lee Kuan Yew School of Public Policy, said the domestic water price should be raised by at least 50 per cent, with subsidies for low-income and large families.

The price of water should be doubled for industrial users, so that companies will increase efforts to reduce water use, he added.

He said there should also be yearly increments according to the inflation rate, to encourage people to reduce consumption.

The tariffs for domestic potable water, which are calculated monthly, stand at $1.17 per cubic m for the first 40 cubic m and $1.40 per cubic m thereafter, excluding taxes.

Prof Biswas said Singapore would have a water crisis if the Linggiu Reservoir does dry up. It is now at about 32 per cent full. The reservoir allows Singapore to draw its entitlement of 250 million gallons per day from the Johor River.

Kopitiam, which operates about 80 foodcourts and coffee shops, is hoping the price increase will not be significant.

"Any price increase will definitely affect business costs... Let's hope that the price increase won't be too hefty," said a spokesman.

Challenging times ahead for Singapore's water security
Masagos highlights importance of combating wastage even as prices are set to increase
By Lin Yangchen, The Straits Times, 9 Feb 2017

Singapore is facing a major challenge in its water security in the next 50 years, and the impending rise in water prices - which sparked debate when it was announced on Tuesday - is only a small part of the solution.

Minister for the Environment and Water Resources Masagos Zulkifli said yesterday at a Pre-Committee of Supply consultation session - attended by 35 members of industry, academia, non-governmental organisations and the public - that having a culture of "revulsion" towards water wastage was much more critical to the country than worrying about the cost of water.

Industry will have a growing role in perpetuating this culture, as it is already using more than half (55 per cent) of Singapore's water. By 2060, this is predicted to hit 70 per cent of Singapore's total water demand, which itself is expected to double by then.

Nevertheless, Mr Masagos said the Government will give due consideration to economic factors in setting the price of water.

"While we need to recover its cost, we cannot do so by sacrificing the competitiveness of Singapore to attract industries to come here," he said.

This might not happen, noted Mr Lee Kok Choy, managing director and Singapore country manager of Micron Semiconductor Asia, who said: "The cost should be whatever it takes to cover the cost of manufacturing water... but it is a very small percentage of total cost (for companies) and it won't drive industry out (of Singapore) if all you do is just cover cost."

Participants at the event said the price increase would motivate decision-makers at companies to take action to reduce water usage.

Suggestions for this were tabled at the session, such as incorporating water-saving measures in the design stage for buildings and industrial processes, rather than trying to improve efficiency later.

Mr Jagadish C.V., chief executive of Systems on Silicon Manufacturing Co, suggested incentives to encourage the right culture in reducing water consumption.

"When you increase the cost of water, there should be incentives that are linked to social responsibility. For example, if you increase (water price) by 1 cent, you give a rebate of 0.45 cent to the industries that are already recycling 45 per cent (of water). The message is, if you are socially responsible in recycling, you pay less," he said.

Although Singapore's water consumption rate of 151 litres per capita per day is considered low among developed cities in Asia, many European countries have water consumption rates below 140 litres per capita per day.

In 2015, the World Resources Institute ranked Singapore highest in water risk alongside six other countries, most of which are in the Middle East.

How industry can cut its usage
By Carolyn Khew, The Straits Times, 9 Feb 2017

Industry users could do more to lower their water footprint by recycling or reusing more of the precious resource.

Top water users here include wafer fabrication companies, which use water as a cleaning agent, as well as other firms that use large amounts of water for cooling purposes.

Professor Ng Wun Jern, executive director of the Nanyang Environment and Water Research Institute at Nanyang Technological University (NTU), said an imminent price hike would raise operating costs for the industry and drive it to consider changing processes to use less water.

One way would be to treat the waste water such firms produce and reuse it internally, such as for flushing toilets, said Dr Cecilia Tortajada, a senior research fellow at the Institute of Water Policy, Lee Kuan Yew School of Public Policy. "Some companies are already improving the efficiency of their water usage, but there is definitely room for improvement," she added.

At the Pre-Committee of Supply Consultation Session with Minister for the Environment and Water Resources Masagos Zulkifli yesterday, participants from the industry said that industrial water consumption data for benchmarking and comparison is not yet available.

Such data would help them in their efforts to implement more water-efficient practices.

Water around the world is generally priced too low, Singapore included, experts said. A price hike would nudge users to think twice about how water is being used. Dr Ng Yew-Kwang, the Albert Winsemius Chair Professor of Economics at NTU, said: "As a rule, utility prices are too low rather than too high in virtually all cities/countries."

But while both price and non- pricing strategies could help reduce water demand, people need to understand that water is scarce, said Dr Tortajada. "Many people know about climate change but don't see it as something that our behaviour will have an impact on," she added.

Additional reporting by Lin Yangchen

Targets, real-time feedback can cut water use in the shower
By Sumit Agarwal and Sing Tien, Published The Straits Times, 11 Feb 2017

Water is an important and scarce resource in Singapore. One of the key strategic thrusts in its water supply blueprint is long-term self-sustainability.

Singapore has developed a water supply system using the Four National Taps - local catchment areas, imported water, reclaimed water and desalinated water - to satisfy long-term needs.

And, for the first time in 17 years, the Government is looking to increase water prices to cover the cost of maintaining and upgrading water supply infrastructure.

Besides securing an adequate water supply and raising prices, water demand needs to be managed. Singaporeans have to learn to conserve water.

The national objective to reduce the per capita water consumption to 140 litres a day by 2030 is on the right track, as consumption has been declining from 165 litres a day in 2003 to 151 litres currently.

To help achieve this goal, the National University of Singapore Business School and Department of Real Estate collaborated with PUB to lead an international research team to study how to cut households' water use for showers.

In Singapore, showering accounts for almost 30 per cent of an average family's monthly water consumption.

If households can change their behaviour during showers, that can yield substantial savings.

One way to change behaviour is to furnish real-time feedback to users during showers on how well they are conserving water. In Switzerland, an experiment involving households fitted with smart shower devices that can provide real-time feedback on water temperature, volume used and how well water consumption goals have been met led to a 22 per cent reduction in water usage. The savings amounted to 484 kWh of energy and more than 8,500 litres of water a year for a two-person household.

We wanted to find out if such intervention would be effective in Singapore. Some 500 households in HDB flats participated in our study over a period of four to six months. Each household was fitted with smart shower devices where data regarding water consumption can be recorded automatically, giving us data for more than 300,000 showers.

For the first 20 showers, the only information all households received was water temperature. This is to help us measure what is their a priori water consumption.

After 20 showers, households were randomly divided into groups with different water conservation targets and feedback regarding the volume used. They were given water conservation targets of 10, 15, 20, 25 or 35 litres.

These targets correspond to ambitious, moderate and easy goals. For households with targets set, they were encouraged to try keeping their water consumption below it. During showers, besides showing volume used, the smart meter also gave feedback on how they were performing with monitor displays of "Very Good", "OK" or "Too Much" to let them know how well they had met the targets.

Another group of households received only water temperature information with no target or feedback. Another group received real-time feedback on water volume when showering with no feedback on how well they were conserving water.

Our results show that for the first 20 showers prior to providing feedback, Singaporeans use almost 20 litres of water in a single shower that takes about five minutes. This is the average amount of water used per shower.

However, when there is feedback given regarding water usage, we find that water consumption goes down by about 10 per cent per shower, saving two litres daily.

But this saving varies by the targets set. Those who received target and volume feedback reduce their consumption the most. The most effective is when a moderate volume target is set. This is the 15-litre target where 3.9 litres less water was used on average during a shower, giving a saving of about 19 per cent. The ambitious target of 10 litres was also effective, though to a lesser degree, with 2.9 litres of water saved on average during a shower.

Our study concludes that getting households to set targets and giving them feedback on their performance not only promote awareness of the need for water conservation but also result in them using less water.

Just as in the case of individuals where goal setting and feedback are keys to performance, households behave similarly even in the often thought ill-disciplined area of water conservation.

Households are also like individuals in that the targets set must be within reach to motivate households to strive hard to attain them. When a target is too ambitious (below 10 litres) or too easily attainable (above 30 litres), it becomes less effective in encouraging households to save water.

With appropriate targets and feedback, Singaporean households can be persuaded to be more water efficient. Their behaviour can be modified within a short span of time, and hopefully, over time, attitudes towards water conservation will also change in the direction of a more sustainable lifestyle.

Last August, the monthly utility statement that households receive showed how they performed on two distinct types of utilities - water and electricity - relative to the neighbourhood and national averages. Such feedback, though not in real time, has a social comparison dimension that may encourage water conservation practices.

Additionally, the statement provides feedback such as "Well done. You have consumed less in all your utilities in the recent two months as compared to the previous two months", much like what was furnished in our study.

Real-time feedback is ideal as we've shown in our study. While this may not be feasible for the time being because of infrastructural issues, we can imagine a system where, one day, households can link their spike in water consumption to specific activities such as car washing and, accordingly, make conscious efforts to reduce the frequency or modify the way in which such water-consuming activities are carried out. This will require investment in infrastructure.

Our utilities board will need to weigh the long-run savings against immediate costs. Not all considerations lend themselves to being monetised. But can and should we place a dollar value on saving the earth?

Sumit Agarwal is visiting professor at National University of Singapore (NUS) Business School and Sing Tien Foo is Dean's Chair Associate Professor at the Department of Real Estate. This research was conducted together with Davin Wang from NUS, Lorenz Goette from University of Bonn, Thorsten Staake from University of Bamberg and Verena Tiefenback from Swiss Federal Institute of Technology.

* Singapore Budget 2017: Water prices to increase by 30% from July 1 in two phases
By Chew Hui Min, The Straits Times, 20 Feb 2017

Water prices will increase for the first time in 17 years, Finance Minister Heng Swee Keat said on Monday (Feb 20).

Including taxes, the prices will go up by 30 per cent in two phases. The first hike will be from July 1 this year, and the second from July 1 next year.

But lower and middle income households will get help to manage the increase.

"Water prices were last revised in 2000, almost 20 years ago. We need to update our water prices to reflect the latest costs of water supply," Mr Heng said in the 2017 Budget speech in Parliament.

There will also be a water conservation tax of 10 per cent on Newater for business users.

In addition, a sanitary appliance fee and waterborne fee will be restructured to become a single volume-based fee.

Households using more water, that is above 40 cubic m, will be charged a higher rate to discourage water wastage.

The increase will be less than $25 per month for three-quarters of businesses, and less than $18 for three quarters of households.

But after subsidies, 75 per cent of HDB households should see an increase of less than $12 a month in their water bills.

Households in one-room and two-room flats will not see any increase in their bills, Mr Heng said.

They will be receiving U-Save rebates of up to $380 for the year, an increase of $120 from $260. Three-room flat households will get an increase of $100 in U-Save rebates, four-room flats an increase of $80 and five-room flats $60.

Executive and multi-generational flat households will get $40 more. These increases are permanent and will cost an additional $71 million a year. About 880,000 HDB households will benefit.

The price increase will go towards maintaining Singapore's water infrastructure, and more expensive sources of water such as desalination.

With more unpredictable weather patterns, water levels at the Linggiu Reservoir in Johor have been falling. It supplies about 60 per cent of Singapore's water needs.

Singapore has invested in desalination and Newater plants which are "costly but necessary" investments, Mr Heng said.

Singapore now uses 430 million gallons of water a day, with the domestic sector accounting for 45 per cent, and the non-domestic sector, the rest.

Water demand is expected to more than double by 2060.

The country gets water from four National Taps - Newater, water from local catchment areas, desalination and imported water.

Minister for the Environment and Water Resources Masagos Zulkifli said in a Facebook post that the price increase was necessary to meet future demand and strengthen water security.

"Rising costs of resources and the use of more complex development approaches have exerted upward pressure on the costs of producing and delivering water," he wrote.

The tariffs for domestic potable water, which are calculated monthly, stand at $1.17 per cubic m for the first 40 cubic m and $1.40 per cubic m thereafter, excluding taxes.

This will go up to $1.19 for the first 40 cubic m and $1.46 per cubic m thereafter from July 1, 2017.

Prices will be $1.21 and $1.52 respectively from July 1, 2018, excluding taxes.

Bigger hike in water prices needed to curb waste: Experts
30% price increase only reflects growing stress on water resources worldwide, they say
By Lin Yangchen, The Straits Times, 22 Feb 2017

The increase in water prices announced by the Government on Monday may be necessary to control usage, but some experts said the jump needs to be bigger if it is to curb wastage.

Industry leaders and water experts said financial incentives can also be introduced to encourage both domestic and industrial water users to adopt water-saving measures.

The experts said the price increase only reflects the reality of increasing water stress worldwide.

Professor Ng Yew Kwang of Nanyang Technological University's Division of Economics, said the 30 per cent increase in the price of water is not excessive, as general inflation here has gone up more than 30 per cent since the last increase in 2000.

He said that there should have been a larger, one-step increase "to give a larger awakening effect for saving water", instead of the phased hikes to be rolled out this July and the next.

Industries now account for more than half - 55 per cent - of Singapore's total water demand, and this is projected to increase to 70 per cent by 2060. Overall water demand is expected to double by then.

Professor Asit Biswas of the National University of Singapore's Lee Kuan Yew School of Public Policy had pushed for a doubling of water price for industrial users, saying that such an increase should not deter industry.

The price of potable water for non-domestic users is $2.15 per cubic m, including water taxes and before goods and services tax, and will increase to $2.74 by 2018.

"Industry has the technology to reduce the amount of water they use. If they make changes in their management (of industrial processes and procedures), they can reduce their water use by 30 per cent to 40 per cent without difficulty," said Prof Biswas.

He said that multinationals like Nestle and Unilever realised the importance of saving water and reduced their use of water globally by 40 per cent over the past 10 years through internal incentive schemes.

Another example is Taiwan Semiconductor Manufacturing in Hsinchu city, Taiwan, which collects rainwater for reuse, purifies waste water for semiconductor processing and uses recycled water for toilets. In 2009, it saved 30 million tonnes of water, according to a report by The Guardian.

"A major campaign should be started (in Singapore) to make industry realise water is a strategic resource, and they have to reduce its use dramatically," said Prof Biswas.

By incorporating a different process which uses less water, Micron Semiconductor Asia ultimately generated more revenue.

The wafer fabrication company uses advanced equipment that sprays silicon wafers to clean them, using less water than the older method of immersing them in water. Although the process is 10 times more expensive, it causes less damage to the wafers, which led to higher revenue.

Mr Jagadish C.V., chief executive of Systems on Silicon Manufacturing, said rebates should be given to companies based on how much water they recycle.

Incentives should also be given to domestic water users, said experts. For example, in Zaragosa city in Spain, the water tariff is reduced by 10 per cent if annual consumption has dropped at least 10 per cent compared with the last two years.

In 2015, the World Resources Institute ranked Singapore highest in water risk alongside six other countries, most of which are in the Middle East.

Mr Sandeep Chamling Rai, senior adviser to the Global Adaptation Programme at the World Wildlife Fund, said the risk is already being seen in the low and uncertain water levels at Linggiu Reservoir in Johor, which supplies Singapore with a major part of its water demand in an agreement that expires in 2061.

The water level at Linggiu Reservoir stands at 32 per cent.

"Singapore's water price hike merely reflects the realities of increasingly stressed water resources in a warmer world," he added.

Additional reporting by Audrey Tan

Costlier water: Businesses say knock-on effect on prices unlikely
By Audrey Tan and Janice Tai, The Straits Times, 22 Feb 2017

That cup of coffee at the kopitiam is unlikely to increase in price even with water prices going up in July.

Businesses yesterday told The Straits Times that water does not make up a significant part of total expenditure and so, it is unlikely they will have to pass on the higher cost of water to consumers.

"Water makes up between 5 and 10 per cent of business costs for coffee shop stalls, so I don't think the hike will affect the operators much - the price for a cup of coffee is unlikely to increase for customers," said Mr Hong Poh Hin, chairman of the Foochow Coffee Restaurant and Bar Merchants Association, which represents 400 coffee shops.

Mr Tan Thiam Yong, managing director of car-grooming company Groomwerkz, which has outlets in Senang Crescent and the Esplanade, said the firm spends about $3,000 on water every month. "It is unlikely that we will raise prices for a car wash from the current $10 for now, as it may not be justifiable and customers may run away," said Mr Tan, adding that water accounts for about 5 per cent of total costs.

However, some businesses have expressed concern following news that water prices will be up by 30 per cent by July 1 next year.

It will be Singapore's first water price hike in 17 years, and was announced on Monday by Finance Minister Heng Swee Keat when he delivered the Budget. He said for three-quarters of businesses, the rise will be less than $25 per month.

But Mr Kurt Wee, president of the Association of Small and Medium Enterprises, said the water price hike will impact manufacturers and industries that use a lof of water and they may not be able to absorb the extra costs.

A management agent of a condominium management firm which oversees 18 condos, who spoke to The Straits Times, said he hopes other operational costs do not rise as well. "Taken alongside rising wage costs of cleaners and security guards, all these will have to be factored into the budget. If the management fund is insufficient to cover the costs, residents will have to pay higher maintenance fees which range from $400 to $900 for each quarter now."

The management agent, who declined to be named, said water costs make up between 10 per cent and 15 per cent of operating costs at each condo estate.

Ms Lim Rui Shan, executive director of the Restaurant Association of Singapore, said it would have been ideal if companies were given more time to develop strategies to counter the price hike or plan for cost- cutting in other areas.

That is exactly what Groomwerkz's Mr Tan is doing with a water recycling and purification system he is planning to introduce at the Senang Crescent outlet by year- end. The system will allow up to 80 per cent of water used in washing cars to be recycled. The system will set him back by at least $30,000, but he said it will help him save water - and lower costs - in the long run.

Social entrepreneur Millicent Tan, 53, said the need to conserve water must reach contracted workers, not just business owners.

She recently witnessed a cleaner spraying running water to clear a leaf at a toilet in East Coast Park instead of using a broom.

"A price hike will make no difference to contracted workers if training is not done hand in hand with the Save Water Campaign as they do not pay the bills," she said.

Mr Sean Yeo, 37, whose family of five lives in a condo in Tampines, said: "It is a bad time to raise water prices as the economy is not doing well and oil and electricity prices are already going up. The increase will be substantial over time and likely to squeeze middle-class families."

Families living in one- to four-room HDB flats will receive annual Utilities-Save rebates to soften the impact of the increase.

After the rebates, 75 per cent of all households will see their monthly water bills go up by less than $18, while the same proportion of HDB households will see their bills increase by less than $12.

MP Louis Ng, chairman of the Nee Soon Town Council, said there is a limit to how much water can be saved, as town councils use water to keep areas clean.

Dr Teo Ho Pin, coordinating chairman of the 15 town councils run by the People's Action Party, said the water hike will inevitably affect town councils' operating expenditure. "Town councils will work closely with our partner agencies to explore more water-saving measures."

Cost of supplying water has more than doubled: PUB
By Tham Yuen-C, Assistant Political Editor, The Straits Times, 24 Feb 2017

The cost of developing and operating Singapore's water supply system has more than doubled in 15 years.

In 2000, it cost about $500 million to run the system, national water agency PUB said yesterday. This included water treatment, reservoir operations, Newater production, desalination, used-water collection and treatment, and the maintenance of water pipelines. By 2015, the cost had risen to $1.3 billion.

Citing the figures following media queries, the PUB said: "(The) water price needs to be raised to reflect rising costs."

The price of water has been a hot topic since Monday, when Finance Minister Heng Swee Keat announced in his Budget speech that water prices will be raised by 30 per cent to reflect the true costs of supplying water. The hike is the first in 17 years, and will be implemented in two phases: July 1 this year and July 1 next year.

Singaporeans have questioned the timing of the increase as it comes amid an economic slowdown.

Yesterday, the PUB said that since the last price increase in 2000, the cost of treating and supplying water has been going up.

The resources needed for the task, such as chemicals, materials and manpower, have become more expensive over the years, said the water agency.

It also has to rely on more costly methods to develop Singapore's water system, as the environment becomes increasingly urbanised, the PUB added.

For instance, it can no longer just dig trenches to lay water pipes underground. As Singapore becomes more built up, it has to use pipe-jacking, a more expensive method which involves assembling pipes into shafts and then pushing them into position with a hydraulic jack.

From 2000 to 2015, the PUB also invested $7 billion in water infrastructure, it said.

The agency expects to spend another $4 billion on such infrastructure from this year to 2021, to meet growing demand and boost the resilience of the water system, especially to face the challenges posed by climate change.

Currently, about 430 million gallons of water are used daily. Homes account for 45 per cent of demand and the non-domestic sector, the rest.

A Newater conservation tax, which will be 10 per cent of the Newater tariff, will be imposed on industrial users to encourage conservation from July 1 .

Water price increase dominates Budget forum
Participants ask if there are other ways to conserve water instead of subjecting everyone to 30% hike
By Pearl Lee, The Straits Times, 24 Feb 2017

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.

On the actual impact of the water hike, and telling it like it is
By Rachel Au-Yong, The Sunday Times, 26 Feb 2017

The hike in water prices has been a hot topic since the Government unveiled this year's Budget, and grassroots leaders voiced concerns about the difficulty in communicating the impending rise to residents at a Budget forum yesterday.

One participant said the Government should have focused on the increase most households have to face after taking into account the GST Utilities-Save voucher, instead of the 30 per cent price hike which, judging by residents' feedback, seems to be the biggest takeaway from last Monday's Budget statement.

Acknowledging this, Senior Minister of State for Finance and Law Indranee Rajah said it would have been useful to highlight the actual impact on residents earlier, to leave less room for alarm.

Those living in one- or two-room flats, for example, would end up spending a dollar less on their monthly water bills on average after the rebates are applied. Those in four-room flats would see their bills rise by about $5 from the current average of $42 after rebates. The price increase would be further buffered by the fact that it will be implemented in two phases, starting this July, she noted.

But she stood by the Government's decision to announce the hike as it did, citing higher production and operation costs, as well as to encourage people to conserve more water as reasons for upping prices.

She told reporters later: "You can't run away from the facts - you have to say what the percentage of the increase is... But I hope with these dialogues, people will get more information and feel more reassured that the impact would not be so large."

She added that the Government is working on ways to communicate its policies more effectively.

Ms Indranee was speaking to 200 grassroots leaders at a People's Association-organised Kopi Talk, a series of dialogues aimed at helping grassroots leaders raise concerns, as well as understand policies.

The price increase of water dominated this forum - as it had in a Reach forum two days earlier.

Human resources practitioner Mark Chan, 56, said the rebates should have been applied directly to PUB instead of given to residents, so that their water bill does not change. But Ms Indranee said it was important people know the true value of water and use it with care. "If you remove the cost element completely, the signal you're sending is that 'It's okay, it's free, you can use it without thinking about the price', which is not the signal that we want to send," she said.

Other topics raised at the forum included the Committee on the Future Economy suggestions, and what the Government was doing to help the elderly.

PUB makes a profit thanks only to govt grants: Maliki
By Pearl Lee, The Straits Times, 27 Feb 2017

National water agency PUB made a profit of more than $160 million last year only because it received about $200 million in grants.

Without the government grants, PUB would have been operating at a deficit, said Senior Minister of State for Defence and Foreign Affairs Maliki Osman yesterday.

The East Coast GRC MP was responding to a participant who asked about PUB's profitability at a post-Budget dialogue with about 100 Malay residents.

On Friday, socio-political site States Times Review published an article stating that PUB is going ahead with a 30 per cent increase in water prices despite posting a profit of $166 million last year.

But Dr Maliki told residents the profit must be seen in the context of the subsidy that PUB received from the Government.

As with previous forums, the increase in water prices was a top concern for residents. Some were worried about its impact on consumer goods and the prices of food and drinks sold in coffee shops.

Water prices will increase by 30 per cent in two phases from July butthose living in public flats will receive rebates to help them cope.

Dr Maliki yesterday explained to residents that 1,000 litres of water are now sold at $2.15. With the hike, the price will go up to $2.74. Assuming that amount of water can make 5,000 cups of coffee, the increase in price for one cup of coffee would work out to be a fraction of a cent.

He told residents that the authorities cannot stop coffee shops and hawker centres from raising prices, if the establishments can justify the increase. But the price increase should not be solely due to the hike in water prices, he said.

He also urged residents to inform the authorities if they find cases of unjustified price increases.

Mr Zahri Ahmad, a 55-year-old Simei resident, said the Housing Board could install sensor taps in homes as part of its Enhancement for Active Seniors programme, as elderly people with dementia may forget to switch off the taps.

Dr Maliki said he would relay the suggestion to HDB but noted that residents could also install thimbles in their taps to save water.

Other topics discussed include the higher housing rebates, the economy, jobs and community services such as aid for disabled people.

Marine and offshore technology student Amirul Mustaqim Irwan, 23, said he is concerned about the disruption of jobs as manual tasks in shipyards are being replaced by automation.

The final-year Ngee Ann Polytechnic student said: "I've been checking out several training schemes but I'm also keeping my options open. I may enter another field altogether if the prospects are better."

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