The Water Strategy

Prime Minister Lee Hsien Loong told water experts at the Singapore International Water Week event that the main challenges to providing clean water and sanitation to Asia’s cities are not technical or even economic – they are political and social. He revealed the Singapore government’s gradual approach to water pricing, which began 15 years ago with a rate of only 1/3 the targeted cost of water. In other words, our price of water has been hiked three-fold according to some nefarious plan. Probably the same kind of plans that set the jaundiced target of a 6 million people population.

His justification? Good water pricing allows water producers to get a return on their investment and make the finances work. So that's how companies like Hyflux makes its money, and government's coffers are topped up with the tax revenue.

We are told PUB has been charged to introduce measures to reduce daily per capita water demand from its 2010 level of 155 litres to 147 litres by 2020. There's nothing said about efforts to reduce the cost of water passed on to the consumers, and help alleviate the burden of inflation and spiralling cost of living. In the write up about the ceramic membrane demonstration plant at Choa Chu Kang Waterworks, the PUB spokesman said the cost savings will help to maintain the price level, not lower it.

Notice the item "Water Conservation Tax" in your monthly water bill. The 30% levy is applied to the total amount consumed, not the excess over some predetermined minimum quantity. Even if you had been extra wastage conscious in your water utilisation, and consumed only, say 60% of the national average for your type of dwelling, you are still punished by this "Water Conservation Tax". To add insult to injury, GST is applied on top of the tax. That's tax upon tax, double taxation. So how does the government get away with it? Simple, the guy who said “If you make it free nobody will bother to turn off the tap,” also said "People support CPF cuts because there are no protest (sic) outside parliament”.

There's an old folk warning that if you throw a frog in boiling water he will quickly jump out. But if you put a frog in a pan of cold water and raise the temperature ever so slowly, the gradual warming will make the frog doze happily...  in fact, the frog will eventually cook to death, without ever waking up. Like all fables, the "boiled frog" anecdote serves its purpose, whether or not it is based on something that is literally true. But it's mighty useful as a political and social tool.

PM Lee said the government increased the water tariff rate over the course of a few years in combination with subsidies for low-income groups and public education campaigns. “Today we price housing water at what it is worth, which is what it would cost us to build desalinate.”