Straits Times Forum 8 Jul 09;
LAST Thursday's report, 'Forget bottled water, tap water as good as it gets' by Professor Tommy Koh and Ms Leong Ching missed an opportunity to discuss the fair price for water consumption.
While I agree that Singaporeans wasted $98.3 million on bottled water (the cost of plastic bottles and the bottling process) in 2007, and that the quality of bottled water may not be as good as that of tap water, I am not convinced that the true cost of one cubic m of water is $1.17.
In fact, the total price consumers pay is $1.93 after factoring in fees and taxes such as the 30 per cent water conservation fee, 28.03 cent waterborne fee and the 7 per cent goods and services tax.
So, we are paying 76 cents - or 65 per cent - more than the listed tariff. A household consuming 35 cubic m a month pays $67.55 for water.
My question is whether Singaporeans are now paying too much for water with the advent of four national taps - local catchment water, imported water, Newater and desalinated water.
Singapore's average daily consumption of 156 litres compares favourably with other First World nations; in fact, it is an excellent achievement given our hot and humid climate. We compare well with Australia (155 litres) and Britain (157 litres), and are far better than Norway (198 litres), Canada (510 litres) and the United States (1,415 litres). Singaporeans have done well to conserve water. Obviously, we should try and further reduce usage to match the Dutch at 140 litres.
Looking at the production cost of potable water, Canada scores the lowest at 40 US cents (58 Singapore cents), while Germany tops the scale at US$1.80 per cubic m. Between 40 US cents and 70 US cents are countries such as the US, Canada, Spain, Australia, Sweden, Ireland, Finland and Italy.
With Singapore's advanced technology to reclaim water by the process of reverse osmosis, the cost has been brought down to about 50 cents per cubic m. A price breaker compared with the reverse osmosis process of the West at about 62 US cents per cubic m.
Now that we are at the forefront of potable water technology and self-sufficient in water supply, national water agency PUB should consider removing the 30 per cent water conservation fee and waterborne fee of 28 cents.
After decades of faithfully serving the national water conservation cause, Singaporeans deserve to start enjoying the benefits of their conscientiousness.
Paul Chan
Just open and drink
Straits Times Forum 8 Jul 09;
'Bottled water is here to stay because it is convenient and user-friendly.'
MR MIKE CHAN: 'I refer to Professor Tommy Koh and Ms Leong Ching's article last Thursday ('Forget bottled water, tap water as good as it gets'). Yes, we should drink tap water at home or in the office, but in a restaurant or other eateries? I will never drink water in a glass brought by a waiter. Who knows where he obtained it from? Better be safe than sorry. Bottled water is here to stay because it is convenient and user-friendly. It is cheap and cleanly sealed. Most modern offices have clean drinking water. However, the water is supplied by a vendor and is not from the office taps. Restaurants and offices should be encouraged to use the tap water from their premises. One way to advance conservation is to use tap water and not commercially supplied water. It is a habit among Singaporeans to drink tap water only after it has been boiled or filtered and not directly. They will, however, drink bottled water readily and directly, without reservations.''
PUB REPLIES: Need for water conservation tax
Straits Times Forum 11 Jul 09;
PUB, the national water agency, refers to Mr Paul Chan's letter on Wednesday, 'Shouldn't we pay less for consuming water?'. Mr Chan commented on the relevance of the water conservation tax and waterborne fee.
Singapore's water supply from local sources has been diversified and made more robust with the introduction of Newater and desalinated water, as well as the development of additional local catchments including Marina, Punggol and Serangoon reservoirs. PUB is confident of ensuring Singapore's self-sufficiency in water supply if need be.
Local catchment water collected through rainfall is limited and subjected to the vagaries of weather and climate change. We will need to rely more on both Newater and desalinated water in future. Desalinated water, in particular, is much more expensive than water supplied from local catchment as desalination is energy-intensive. Water conservation is still necessary to reduce our reliance on costly desalination.
Water pricing is an important and effective mechanism to get consumers to conserve water. The Government prices water not only to recover the full costs of producing and distributing it, but also to reflect the scarcity of this precious resource and the higher cost of additional water supplies. Thus, the Government levies a water conservation tax as part of the water charges. The waterborne fee and the sanitary appliance fee are to cover the cost of providing a modern sanitation system.
Singaporeans have been supportive of water conservation, and this enables us to bring down our per capita domestic water consumption from 165 litres per day in 2003 to the current 156 litres. An average household of four consumes 19 cubic m per month, and its monthly water bill, inclusive of sanitation fees, is about $42. We aim to further reduce the level of per capita domestic water consumption to 147 litres per day by 2020.
PUB thanks Mr Chan for his comments.
Chan Yoon Kum
Assistant Chief Executive
PUB
Water conservation tax hard to swallow
Straits Times Forum 15 Jul 09;
I REFER to last Saturday's letter ('Need for water conservation tax') by Mr Chan Yoon Kum, assistant chief executive of national water agency PUB, in response to my letter ('Shouldn't we pay less for consuming water?') on July 8.
Mr Chan did not address the crux of my question, which was this: After many decades of conscientiously and successfully pursuing water conservation measures, is it necessary to continue using a hefty pricing mechanism to penalise consumers for some incremental reduction?
What is the ideal limit of water consumption in our hot and humid climate without compromising basic hygiene that would convince the PUB to remove the water conservation tax and waterborne fees?
According to a study in 2003, 'The water issue between Singapore and Malaysia: No solution in sight?', by Dr Lee Poh Onn, a Fellow of the Institute of Southeast Asian Studies, Singapore produced 1.3 million cubic m of water per day. The PUB revealed that by last year, the daily capacity had increased to more than 1.4 million cubic m, of which domestic households consumed half and the rest was sold for commercial revenues.
The report quoted that our raw water processing cost was 25.3 cents per cubic m. Dr Lee summarised the production cost of imported water at 26 cents, Newater at 39 cents and desalination water at 78 cents (exchange rate of S$1 to RM$2.08 in 2003).
By 2011, the PUB will be producing 1.33 million cubic m of water (0.68 million cubic m from catchments, 0.4 million cubic m from desalination and 0.25 million cubic m of Newater).
Based on the 2003 study, the average cost would be 41.5 cents per cubic m. With a 20 per cent increase, the cost is about 50 cents per cubic m.
There is hardly any justification for responsible consumers to pay $2.21 per cubic m of water quoting Mr Chan's example. The water tariff in Johor Baru is 36 cents (90 Malaysian sen), while that in Hong Kong is HK$4.15 (80 Singapore cents) per cubic m.
Is it logical or reasonable for Singaporeans to pay over four times the recovery cost of drinking water - a basic human need?
While it is laudable that Singapore proudly and unselfishly helps solve the water dilemma by sharing its drinking water technology with the world, the country's citizens should also share the benefits of Singapore's water success.
It took us a long time to get to where we are now; where we are self-sufficient with less imported water if needed on a sustainable basis.
Tax revenues and sanitary fees should cover the maintenance cost of the sanitation system. Hence, the water conservation tax and waterborne fees have lost their intended purposes. They can only become an extra burden on citizens.
Paul Chan
Water tax at odds with pro-family policies
Straits Times Forum 15 Jul 09;
MANY consumers will agree with national water agency PUB's acknowledgement ('Need for water conservation tax', July11) of Mr Paul Chan's view ('Shouldn't we pay less for consuming water?', July 8) that Singaporeans have been conscientious and supportive of water conservation measures.
Few will disagree with the agency's caution about the scarcity of water and need to conserve it as a precious resource.
But the issue raised by Mr Chan, which the PUB did not address, was whether the water conservation tax is out of date. Just as estate duty has been abolished, the water conservation tax should be scrapped for the following reasons:
The tax is at a very high rate of 30 per cent. In addition, the goods and services tax (GST) at 7 per cent is imposed over and above the water conservation tax. Indirectly, the Government collects additional GST as a result of the water conservation tax.
The water conservation tax is also at odds with two key public policies: encouraging families to have more children and encouraging adult children to support their elderly parents.
The water conservation tax seems to penalise those who have more children and who support their aged parents as more people in a household results in more water consumption.
When the GST was introduced, it was marketed as a fairer tax because the more you consume, the more tax you pay. So, do we still need a water conservation tax? It is time that the tax is reviewed.
Manmohan Singh
