New Provisions on the Management of Drinking-Water Supply Systems

The Ministry of Public Works and Public Housing (“Ministry”) has issued Regulation No. 27/PRT/M/2016 on the Management of Drinking-Water Supply Systems (“Regulation 27/2016”), which further regulates the various technicalities involved in the organization of drinking-water supply systems, as mandated under Government Regulation No. 122 of 2015 on Water-Supply Systems.[1]
 
The 27/2016 Regulation’s ultimate objective is to set out a framework for the provision of sustainable, high-quality and affordable drinking-water supplies for the general public. This drinking-water supply system (Sistem Penyediaan Air Minum – “SPAM”) framework encompasses:
 

a.	Management framework;
b.	SPAM infrastructure;
c.	Management procedures; and
d.	Monitoring.

 
Regulation 27/2016 is of relevance to State/Regionally Owned Enterprises (“BUMN/BUMD”) working in the drinking-water-supply business, as well as to Central/Regional Technical Units (“UPT/UPTD”), civil society and any business entities who manage drinking-water supply systems (“SPAM Organizer”).[2]
 
Frameworks
 
SPAM is infrastructure which covers the provision of drinking-water supplies to the general public.[3] In order to manage SPAM, the government will set out a framework and Master Plans which will outline SPAM policies and strategies.[4] Both of these frameworks are implemented at the national (inter-provincial), provincial (inter-regency/city) and regency or city levels.[5]
 
SPAM Infrastructure
 
SPAM’s infrastructure is divided into two main areas, namely: Pipeline Networks and Non-Pipeline Networks.[6]
 
Pipeline Network SPAM are established in order to guarantee the quality, quantity and sustainability of drinking-water supply systems, so as to fulfill the public’s basic daily needs 24 hours a day.[7] On the other hand, the Non-Pipeline Network is designed to provide secure access for all members of the public who consume drinking-water.[8] The details of basic SPAM infrastructure are set out in the table below:
 

Type of SPAM	Infrastructure
Pipeline Network SPAM[9]	1. Raw-water facilities; 2. Production facilities; 3. Distribution facilities; and 4. Service facilities.
Non-Pipeline Network SPAM[10]	1. Shallow wells; 2. Hydro-pump wells; 3. Rainwater tanks; 4. Water tanks/water terminals; and 5. Water-reservoir facilities used to collect water from water springs.

 
SPAM Management Procedures
 
As with all infrastructure, SPAM must be maintained in order to preserve its durability. In this regard, Regulation 27/2016 sets out various details which relate to SPAM development and management measures and these must be adhered to by SPAM Organizers.[11] However, it should be noted that prior to engaging in any such activities, SPAM Organizers must first secure water-resource utilization licenses, as regulated under Ministry Regulation No. 01/PRT/M/2016 on Procedures for the Securing of Licenses for the Management and Utilization of Water-Resources.[12] After this stage has been completed, SPAM Organizers are required to implement basic management procedures (proses dasar manajemen) when engaging in the management of any SPAM. These procedures should encompass:[13]
 

a.	Planning;
b.	Implementation;
c.	Monitoring; and
d.	Evaluation.

 
SPAM Organizers are also required to comply with the various requirements which are detailed in table below:[14]
 

Management Activities		Procedures
Infrastructure Development	Scope of activities: a. Establishment of new infrastructure; b. Infrastructure improvement; and c. Infrastructure expansion.	Planning stage: a. Feasibility studies; and b. Technical plans.
		Implementation stage: a. Procurement; b. Construction; c. Quality management; and d. Utilization.
		Monitoring stage: a. Collection of performance data; b. Supervision As Well as quality and quantity control.
		Evaluation stage: a. Technical evaluation; and b. Drinking-water supply service evaluation.
Management	Scope of activities: a. Operation/maintenance; and b. Repairs.	Planning stage: a. Feasibility studies (with the exception of any repair activities); b. Technical plans; and c. The drafting of standard operational procedures (with the exception any repair activities).
		Implementation stage: a. Procurement; b. Construction; c. Quality management; and d. Utilization.
		Monitoring stage: a. Collection of performance data; b. Supervision as well as quality and quantity control.
		Evaluation stage: a. Technical evaluation; and b. Drinking-water supply evaluation.
	Scope of activities: a. Human-resource development; and b. Institutional development.	Planning stage: a. Business-strategy planning; b. Business planning; and c. Budgetary planning.
		Implementation stage: a. Quality management; and b. Utilization.
		Monitoring stage: a. Collection of performance data; and b. Supervision as well as quality and quantity control.
		Evaluation stage: a. Institutional and financial evaluation; and b. Drinking-water supply service evaluation.

 
Special Provisions for BUMN/BUMD
 
In a bid to maintain the quality, quantity and sustainability of SPAM standards, BUMN/BUMD are obliged to submit the various evaluation reports mentioned above to the Ministry, and relevant governor or regent/mayor in accordance with their authority.[15] Non-compliance with this mandatory reporting requirement will see the offending BUMN/BUMD being subject to the following sanctions:[16]
 

a.	First warning, if the BUMN/BUMD fails to meet SPAM quality, quantity and sustainability standards;
b.	Second warning, if the BUMN/BUMD fails to improve SPAM standards within two months of any first warning being issued; and
c.	Administrative sanctions, if the BUMN/BUND fails to improve SPAM standards within 10 months of any second warning being issued.

 
Regulation 27/2016 has been in force since 5 August 2016._RP