30% Water Price Hike in Singapore

Appreciating each drop of the increase

Budget 2017 was recently announced. And the emphasis on self-sustenance has never been stronger. Juxtaposed against political madhouses in various parts of the world, I’d commend the overall sanity of measures to be implemented – generally moderate. Two announcements on building a Quality Living Environment piqued my interest:

  1. The implementation of a carbon tax starting 2019
  2. An eventual 30% increase in water prices over two phases, starting July this year

Tax on carbon emissions has been implemented in many of the developed countries, some more willing than others. The tax is not yet definitive and the committee will continue soliciting views from the private sector and the public. But the intent is to

  1. “create a price signal to incentivise industries to reduce their emissions”. To be fair, taxes don’t “incentivise”. They’re punitive measures, and I think we don’t have to sugarcoat here; We should be proud of it – it is only right that you pay for harming the environment!
  2. use funds for environmental research and initiatives

Read this Straits Times article for more information.

Meanwhile, the water price hike is a definitive measure. To understand it, let’s take a look at our monthly utilities bill, which comprises the following:

sample SP bill.png

Source: EMA website

  1. Reading taken – Pay per use; For the amount of water you use.
  2. Waterborne Fee – Pay per use; For the cost of treating used water and for operating and maintaining used water network.
  3. Water Conservation Tax – Pay per use; To reinforce the importance of conserving water. (I never knew!)
  4. Sanitary Appliance Fee – Pay per fitting (e.g. per toilet bowl fitted); For the cost of treating used water and for operating and maintaining used water network.

With the price increase, here’s the effect:

  1. Reading taken – Tariff per m³ increases.
  2. Waterborne Fee – Fee per m³ increases.
  3. Water Conservation Tax – % increase per m³.
  4. Sanitary Appliance Fee – Pay per use (e.g. per flush instead of per toilet bowl); incorporated into Waterborne fee.

Here’s a diagram off PUB website of the breakdown:

pub-breakdown-price-hike

Our government recognises the increase and is therefore increasing the Utilities-Save (U-Save) tax rebate vouchers this November, under the following structure:

increase-in-gst-u-save

And households’ average monthly water bills will end up as follows:

bills-after-u-save

If all these tables are too much for you to digest, here’s the summary:

“75% households are expected to experience an increase of less than $12.”

This is according to PUB’s estimates.

$12 per month x 12mth = $144 a year and that can still be quite a sum for certain households, and definitely, a source of complaint for many Singaporeans.

I noticed that the news articles consistently highlighted a few caveats for the announcement of this, namely that:

  • it is the first time since 2000 that water prices are revised
  • cost of water production has more than doubled since then
  • that the U-Save vouchers will offset the price increase

Not that these are not important highlights, I find them kind of mechanical in one-dimensionally alleviating only the financial concerns. What about the ‘softer’ aspects of this measure? I think Singapore has a great water story that should be emphasised. It is a story of vital importance to the survival of our small city-state, yet many Singaporeans take water for granted. We should highlight just how amazing it is that we’re able to have potable water at the turn of a tap.

11I remember visiting PUB’s NEWater plant as a young student, awed by the technology and brilliance. But how incredible it is, I had no way of telling. Therefore, I have decided to dig deeper into this mystery and put into perspective how differently Singapore manages its water supply.

Read  Singapore’s Water Story to learn more about this!

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4 Comments Add yours

  1. tacomob says:

    Water has been way too cheap for way too long already in view of its huge importance.

    Unlike the eventual substitution of the world’s oil supplies as an energy source, there is no substitute for H2O.

    There is also no way to ‘create’ water artificially. We have to do with the amount of water that we have. It’s a finite but renewal resource. We do “use water”, but we don’t “consume water”! Water is not an exhaustible resource!

    Having said that the amount of water on planet earth is fixed. But the demand is rising (minimum in tandem with population growth). Hence the price has to go up over time too. Basic economics.

    It could be close to a know-brainer / no-brainer to invest in water businesses / companies for the long run.

    Liked by 1 person

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