Water supply and sanitation in Indonesia

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Indonesia: Water and Sanitation
Data
Water coverage (broad definition)	87%
Sanitation coverage (broad definition)	73%
Continuity of supply (%)	n/a
Average urban water use (l/c/d)	n/a
Average urban water tariff (US$/m3)	n/a
Share of household metering	n/a
Annual investment in WSS	US$2 per capita (2005 estimate)
Share of self-financing by utilities	n/a
Share of tax-financing	n/a
Share of external financing	n/a
Institutions
Decentralization to municipalities	Substantial
National water and sanitation company	None
Water and sanitation regulator	None
Responsibility for policy setting	Ministry of Health and Ministry of Home Affairs
Sector law	No
Number of urban service providers	306
Number of rural service providers	n/a

Water supply and sanitation in Indonesia is characterized by poor levels of access and service quality. Over 100 million people in Indonesia lack access to safe water and more than 70 percent of the country’s 220 million population relies on water obtained from potentially contaminated sources.^[1] With only 2% access to sewerage in urban areas is one of the lowest in the world among middle-income countries. Pollution is widespread on Bali and Java. Women in Jakarta report spending US$ 11 per month on boiling water, implying a significant burden for the poor.

The Government of Indonesia has stated its commitment to achieving the Millennium Development Goals (MDGs). In order to do so, an estimated 78 million more people will require improved water supply and 73 million improved sanitation services by 2015, not to mention necessary improvements in service quality for those already shown as having access.^[2]

Current levels of investment of only US$2 per capita and year are insufficient to attain the MDGs. Furthermore, policy responsibilities are fragmented between different Ministries and local utilities that operate and maintain urban water systems remain weak.

Since decentralization was introduced in Indonesia in 2001 local governments (districts) have gained responsibility for water supply and sanitation. However, this has so far not translated into an improvement of access or service quality, mainly because devolution of responsibilities has not been followed by adequate fund channelling mechanisms to carry out this responsibility.

Contents 1 Access 2 Service quality 3 Health impact of inadequate water supply and sanitation 4 Household-level drinking water treatment 5 Pollution 6 Responsibility for water and sanitation 6.1 Policy and regulation 6.2 Service provision 6.2.1 Urban areas 6.2.2 Rural areas 7 History and recent developments 7.1 Jakarta concessions 7.2 Policy for rural water supply and sanitation 8 Efficiency 9 Cost recovery and tariffs 10 Investment and Financing 11 External support 11.1 World Bank 11.2 Asian Development Bank 11.3 United States 11.4 Canada 11.5 The Netherlands 11.6 UNICEF 12 References

[edit] Access

		Urban (47% of the population)	Rural (53% of the population)	Total
Water	Broad definition	87%	69%	77%
	House connections	30%	6%	17%
Sanitation	Broad definition	73%	40%	55%
	Sewerage	2%	0%	1%

Source: Joint Monitoring Program WHO/UNICEF 2004. See data sheets for water and sanitation

Data on access to water and sanitation in Indonesia vary significantly depending on the source consulted and the definition of access. According to the Joint Monitoring Program by WHO and UNICEF (see table above) access to improved water supply stood at 77% and access to improved sanitation at 55%.

However, according to Indonesia's 2004 socio-economic survey (SUSENAS) only about 47% of the population has access to water from improved sources considered relatively safe. That includes 42% of the urban and 51% of the rural population. In the 8 years from 1994 to 2002, this figure increased by only 10% in rural areas and 9 percent in the urban. At this rate, by 2015, only about 56% of the rural population can be expected to gain access to safe water supply, when the MDG target for the whole country is 73%.

Population access to improved sanitation in rural areas has remained stagnant at around 38% since 1985 according to the Joint Monitoring Program.^[3] More than 40% of rural households use unsanitary open pits or defecate in fields, beaches and water bodies.

Urban sanitation is the least well addressed of major policy issues in Indonesia. Poor sanitation in cities and small towns is posing population health hazards through pollution of both ground and surface water sources used by urban populations for a variety of purposes. Disposal and treatment of sewage is available for less than 2% of the population.

Top-down delivery systems of the past have led to the poor not gaining appreciable access to safe sanitation services in both urban and rural areas.^[4]

[edit] Service quality

No data are available on the average continuity of water supply in Indonesian cities. However, in Jakarta 92% of users received continuous water supply in 2001..^[5]

Concerning drinking water quality, about 30% of the water distributed by water companies in the country is contaminated with E.coli or fecal coliform and other pathogens.^[6]

[edit] Health impact of inadequate water supply and sanitation

Unsafe drinking water is a major cause of diarrhea, which is the second leading killer of children under five in the country and accounts for about 20% of child deaths each year. Every year, at least 300 out of 1,000 Indonesians suffer from water-borne diseases, including cholera, dysentery, and typhoid fever, according to the Ministry of Health.^[7] Economic losses due to inadequate sanitation alone were estimated at 2.4% of GDP in 2002. Significant damage to the country's future potential in terms of infant mortality and child malnutrition in low-income areas of Indonesia is greatly associated with inadequate access to safe water and basic sanitation.^[8]

[edit] Household-level drinking water treatment

People in Jakarta spend significant resources on boiling water to make it drinkable. Indonesian women report spending more than 100,000 rupiahs or 11 US dollars a month on kerosene for boiling water. However, a new system to treat drinking water at the household level without boiling has cut down on these costs and reduces health risks among women and children.

The system, called “Air Rahmat” or “gift water,” is produced by a private-public partnership called Aman Tirta. Members of Aman Tirta include the Johns Hopkins University Center for Communication Programmes and CARE International Indonesia. The brand name refers to a liquid 1.25% sodium hypochlorite (bleach) solution which is effective in deactivating micro-organisms such as E.coli in water. The solution is originally developed as part of the Safe Water Systems program of the U.S.-based Centers for Disease Control and Prevention. When used correctly in conjunction with proper storage, the water treatment solution has been shown to reduce the risk of diarrhea up to 85%. Air Rahmat is also able to protect water for two to three days from recontamination. The solution is easy to use by adding three milliliters of Air Rahmat for every 20 liters of water, shaking or stirring for 30 seconds, and waiting for at least 30 minutes until the water is ready to drink.^[9]

[edit] Pollution

Deteriorating quality and quantity of primary water sources has reached critical proportions in the most densely populated islands like Java and Bali - which are home to the largest numbers of the country's poor.^[10]

The Indonesia Environment Monitor notes that Indonesia ranks among the worst countries in Asia in sewerage and sanitation coverage. Few Indonesian cities possess even minimal sanitation systems. For example, according to a 2002 World Bank report,^[11] less than 3% of Jakarta's population is connected to a sewer system. The absence of an established sanitation network forces many households to rely upon private septic tanks or to dispose of their waste directly into rivers and canals. The commonality of the latter practice has led to significant contamination of Indonesia's surface and groundwater, as well as to repeated epidemics of gastrointestinal infections. As of 2001, an estimated 90% of Jakarta's shallow wells were polluted by domestic waste.^[12]

[edit] Responsibility for water and sanitation

[edit] Policy and regulation

Policy and regulatory responsibilities for the water and sanitation sector are shared among several ministries. While the Ministry of Health is responsible for water quality-related aspects, and to a certain extent rural services, responsibility for the urban sector is shared between the Ministry of Home Affairs and the Ministry of Public Works.

[edit] Service provision

[edit] Urban areas

The provision of water and sanitation services in urban areas is the responsibility of PDAMs (Perusahaan Daerah Air Minum), Local Government Owned Water Utilities. There are 306 PDAMs in Indonesia. Two (Jakarta and North Sumatra) operate at provincial government level. All others operate at district government level, meaning at the level of a regency (of which there are 349) or a city (of which there are 91) (see List of regencies and cities of Indonesia)^[13] There are also a few utilities dedicated exclusively to sanitation, called PD-PAL or Local Government Owned Wastewater Utilities.

Utilities are associated in Perpamsi, the national association of water utilities. In 2002 it initiated a performance benchmarking program with support from the World Bank. The data base currently contains 80 Water Utilities (PDAM) in Indonesia, including most of the larger ones.^[14]

[edit] Rural areas

Rural Indonesia has a long history of community-managed water supply services using naturally occurring springs, rainwater and groundwater sources. However, community capacities to sustain such water systems over long periods have tended to be limited. Past rural water supply and sanitation projects have often not invested sufficiently in building community capacity to plan, implement, operate and maintain services in ways that benefit and satisfy all sections of rural societies, conditions necessary for service sustainability. Rural consumers have not consistently been offered voice and choice in decisions related to establishing and managing services and paying for them. Services have often been provided in a top-down manner by agencies external to the community, using public sector or donor funds and contractors answerable to government agencies rather than to the users of services. This has led to mismatches between what the users want and get, a lack of community ownership of rural water supply and sanitation facilities and unclear responsibilities for maintenance.

In 2003 the government adopted a National Policy for the Development of Community-Managed Water Supply and Environmental Sanitation Facilities and Services that provides a clear route map for sector reform, by:

• Radically changing the policy goals for the sector, from achieving "coverage targets" counted in terms of construction of systems facilities, to the twin goals of sustainability and effective use of water supply and sanitation services;
• Promoting water as a public as well as an economic good;
• Espousing strategies such as empowerment of communities to choose, co-finance, construct and manage and own their WSS services;
• Requiring the use of gender-and poverty-sensitive approaches in working with and empowering user communities to ensure poverty targeting and impact on local poverty;
• Building stakeholders' understanding at all levels of the multi-dimensional nature of service sustainability;
• Measuring success in terms of sustained population access to services, and effective use of those services, i.e. hygienic and health - promoting use of services by all sections of communities and improved sanitation and hygiene behaviors among various age-sex groups of the population.

The new sector policy is currently being operationalized in a growing number of provinces and districts. A new generation of community-driven WSS projects has been built on the policy and is demonstrating better results in terms of service access and quality as well as sustainability. However, the new generation of community-demand driven projects also shows that for long-term sustainability of services, in particular in peri-urban areas or rural areas that are increasingly absorbed in urban conglomerations, community management alone may not be an adequate arrangement. Newer models of support and responsibility sharing between user communities and local governments or local private sector agencies need to be evolved and tested.^[15]

[edit] History and recent developments

[edit] Jakarta concessions

In February 1998 two 25-year water concessions were awarded to serve the city of Jakarta. A subsidiary of The French firm Ondeo (now Suez), called Palyja, was awarded the concession for the western part of the city and a subsidiary of the British firm Thames Water International called TPJ was awarded a concession for the eastern part.

Due to the impact of the 1997 East Asian financial crisis the contracts were renegotiated in 2001 and the Water Supply Regulatory Body (JWSRB) was established as an "autonomous" regulator in charge of supervising the concessions on behalf of the Governor of Jakarta and the Ministry of Public Works.^[16]

Since early 1998 the water rate has increased by 15% in February 1998, 35% in April 2001, 40% in April 2003 and 30% in January 2004 in nominal value prices.^[17] The inflation rate in Indonesia was 12% in 2003, 6.6% in 2004, 6.1% in 2005 and 10.5% in 2006.^[18] More frequent tariff increase had been contractually scheduled to finance needed investments and to compensate for inflation. However, Jakarta Governor Sutiyoso and the City Council had refused to raise water rates according to schedule, thus forcing the two concessionaires to cut down on investments.

In 2004 a consumer group sued the concessionaires for providing poor services. The lawyers of the utilities rejected the claims saying that the evidence presented was poor and that a survey to support the claims was not carried out by an independent agency.^[19]

In early 2004 a regular increase of tariffs every six months between January 2004 and 2007 was agreed. Subsequently investments picked up again, focusing on replacing the decrepit distribution network.^[20]

[edit] Policy for rural water supply and sanitation

In 2003 the government adopted a National Policy for the Development of Community-Managed Water Supply and Environmental Sanitation Facilities and Services that provides a clear route map for sector reform (for details see above).

[edit] Efficiency

Non-revenue water in Indonesia’s best utilities stands at only 20%, while the worst quartile of utilities participating in Perpamsi’s benchmarking exercise have NRW of 43%. However, NRW data is generally unreliable as many PDAMs do not have meters installed to accurately measure NRW. In terms of labor productivity, the best performing utilities have a staff ratio of 4 per 1000 connections, while utilities in the worst quartile have more than 9 staff per 1000 connections.^[21]

In Jakarta the level of non-revenue water was 51% in 2001, one of the highest levels in Indonesia. However, in terms of labor productivity the two utilities in Jakarta fare relatively well with only 5.3 employees per 1000 connections.^[22]

[edit] Cost recovery and tariffs

As in many other countries, those not connected to water supply networks pay the most for water. A survey in North Jakarta found the price of water in the early 1990s was $2.62/m3 for vendor customers, $1.26/m3 for standpipe customers, $1.08/m3 for household resales customers, and only $0.18/m3 for connected households.^[23]

According to the ADB In Jakarta the average tariff in 2001 (average of residential and commercial users) was US$ 0.285/m3, compared to production costs estimated at only US$ 0.112/m3. 98% of revenues billed were collected.^[24]

[edit] Investment and Financing

Total infrastructure spending in Indonesia was 55 trillion Rupiah in 2005 (US$ 5.7 billion). These expenditures were financed mainly by the local (23 trillion Rupiah) and central government (also 23 million Rupiah), followed by the provincial government (9 million Rupiah). Infrastructure investment stood at 10% of total government expenditures, as shown in the Table below.

	Central	Province	District	Total
Infrastructure	23	9	23	55
Total	357	38	141	536
Share of Infrastructure	6.4%	23.7%	16.3%	10.3%

Source: Calculations based on World Bank Indonesia Public Finance Data Page. All figures are in current trillion Rupiah for 2005.

While it is not entirely clear how much of this sum has been invested in water supply and sanitation, the ADB estimates that only US$ 124m per year (average of 2004-2005) from the regular national budget were allocated to water supply and sanitation.^[25]

Since decentralization in the year 2001, local Governments have typically invested less than 2% of their annual budgets on water supply, even less on sanitation and almost nothing on improving hygiene practices.^[26] Assuming that 2% of local government (provincial and district) budgets are spent on water and sanitation, local government investments in water and sanitation were 3.6 trillion Rupiah or US$375m or about three times higher than the US$124m financed through the central budget. Total investments thus can be very tentatively estimated at about US$500m, or slightly more than what has been estimated by one source as the required investments to meet the MDGs, or US$450 million per year^[27] At about US$2 per capita and year these investments still remain far lower than investments in water and sanitation in other middle-income countries.

The economic crisis of the late 1990s had severely curtailed investment in infrastructure. Central government spending on development dropped from US$14 billion in 1994 to US$5 billion in 2002, within which the share of infrastructure spending further declined from 57 to 30% over the same period. Moreover, according to the World Bank, poor institutional and regulatory frameworks and rampant corruption in the infrastructure sector, which were prevalent even before the crisis, continued without serious sector reform efforts by the government until today.^[28]

[edit] External support

External support to the water and sanitation sector in Indonesia is provided by

• international financial institutions, such as the World Bank and the Asian Development Bank,
• countries providing bilateral aid such as the United States, Canada, Japan, Australia and The Netherlands
• UN agencies such as UNICEF.

[edit] World Bank

The World Bank's Third Water Supply and Sanitation for Low Income communities Project for Indonesia aims to increase the number of low-income rural and peri-urban populations accessing improved water and sanitation facilities and practicing improved hygiene behaviors. The US$ 137.5m loan was approved in June 2006. The project will support community driven development (CDD) planning and management of water, sanitation and hygiene improvement programs, build stakeholder commitment and expand the capacity of central, provincial and district government agencies. It will also ensure that targeted community households gain access to improved sanitation facilities of their choice, are using improved water supply and sanitation infrastructure effectively and are progressively adopting key hygiene practices. Finally, it will provide participating communities with a menu of technical options for rural water supply and public sanitation infrastructure. The project is implemented by the Ministry of Health.^[29]

[edit] Asian Development Bank

The Community Water Services and Health Project will provide clean water and sanitation facilities to about 1,500 communities of rural Indonesia, including tsunami-affected areas. The project was approved in April 2005 comprising loans amounting to US$64.7 million and $16.5 million in an emergency assistance grant. The project will target 1,000 communities in 20 districts in the provinces of West and Central Kalimantan, Jambi, and Bengkulu, where the project will provide about 1.2 million people with safe drinking water and about half of these with improved sanitation. An additional five districts consisting of 500 communities in Aceh and Nias-North Sumatra affected by the December 2004 earthquake and tsunami disaster will be covered under a complementary emergency assistance grant package. The project will give local governments the capacity to plan sustainable investments. It will also conduct advocacy and awareness training among the communities to build capacity for them to operate and maintain new water and sanitation facilities that will be built through the project. To maximize the health impact of the project investments, the project will finance hygiene promotion at schools, religious facilities, and among the communities. The Directorate General of Communicable Disease Control and Environmental Health of the Ministry of Health is the executing agency of the project^[30]

[edit] United States

Since early 2005 USAID has provided technical assistance to water utilities (PDAMs) in Java and Sumatra on issues related to full cost recovery tariffs and improved technical operation, with the objective of improving their creditworthiness and ability to borrow to meet network expansion needs. USAID is also looking at ways to use its partial credit guarantee mechanism to further increase local water utilities’ access to commercial financing.^[31]

[edit] Canada

CARE Canada and the Canadian International Development Agency (CIDA) support the CARE-Sulawesi Rural Community Development Project (SRCD). The emphasis of the SRCD project is as much on developing the rural communities as it is on providing water supply and improving sanitation. CARE uses the "community management approach", by which communities are heavily involved right from the very beginning, from the design through construction, implementation, operation and maintenance.

The approach works by establishing a village water committee and a series of sub-committees: for example, sanitation, construction and finance. The village itself decides how it will raise the amount of money needed for its contribution to the project. This is usually done by monthly levy whereby each family contributes a small amount of money over the course of four to six months. The village construction committee also organizes the labour to install the system. All the labour is done manually without the use of heavy machinery, which means a low environmental impact and lower cost. With water close at hand, most households are also building their own simple latrines.^[32]

[edit] The Netherlands

The public Dutch water company Water Supply Company Drenthe (WMD) and Dutch development aid support various water companies in Eastern Indonesia. Joint venture contracts have been concluded with four companies (Ambon, Bacau (Maluku), Biak, Sorong (Irian Jaya/Papua), negotiations are going on with seven other companies in North Sulawesi, Maluku and Papua. The WMD has reserved 3.4 million euros for the project. These amounts are intended to fund the first five years.^[33]

[edit] UNICEF

UNICEF supports the Indonesian government in developing and implementing strategies that improve drinking water and sanitation conditions across the country. UNICEF also assists the government in improving relevant planning mechanisms, monitoring systems and databases. UNICEF continues to play a pivotal role as the water and sanitation sectoral coordinator for the post-tsunami response in Aceh and North Sumatra, developing partnership frameworks that pool competencies and resources across organizations.^[34]

[edit] References

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