Guyana Water Inc. (GWI) Chief Executive Officer (CEO) Shaik Baksh yesterday said freely reconnecting its service to disconnected customers will plunge the utility company further into debt.
Baksh made the comment yesterday morning during a hearing before the Public Utilities Commission (PUC) where it was challenged by the Guyana Consumers Association (GCA) to justify and reduce the fee.
During the virtual hearing yesterday morning, Baksh stressed that the reconnection fee is far below what the company is paying contractors for disconnecting delinquent customers. “We cannot disconnect and reconnect freely without a charge. This will have an impact on GWI’s debts and our debts [are] going up every day. We have a concern about that… We must impose a reconnection charge…,” Baksh said.
At the conclusion of the lengthy hearing, Chairwoman of the PUC Della Britton adjourned the proceedings and requested the utility company to provide additional information to support the claim. A judgment will be made after the PUC reviews the arguments and evidence provided.
GWI was allotted time to supply the Commission with the relevant documents that were requested and that was promised by the CEO.
Consultant of the Guyana Consumers Association (GCA) Dr. Yog Mahadeo in his opening arguments made an impassioned plea to the company to reassess and redress the reconnection cost, which he described as “super high.” Mahadeo argued that it is their view that the company is utilising the opportunity for profit gains under the cover of tariff and reconnection fees.
GWI customers are mandated to pay a fee of $7,500 for the reconnection of their service after being disconnected.
Mahadeo on behalf of the GCA pleaded with the commission to overhaul the rates currently being charged, reassess and remove the “draconian reconnection rates” and recommended that reconnection rates be no more than $100. “We hold fast to the position that the reconnection fee is punitive. It is a measure to punish consumers for daring to be in a position where they have to choose to balance their household bills. We also beg that you look at reconnection from the pure aspect of service that is being disconnected and reconnected and not punitive measures,” he underscored.
‘Last resort’
But defending the GWI’s position on charging a reconnection fee, the company’s CEO argued that disconnection is a last resort of the company when dealing with delinquent customers.
He stated that the company has a strategy where it contacts persons and offers a payment plan to them at a rate they can afford monthly. Executive Director of Commercial Services and Customer Relations Andrea Jodhan-Khan added that in cases where customers are disconnected and are unable to pay the fee immediately, it is included in their payment package once they agree to make payments monthly.
The CEO went on to state that customers have a grace period of five to six months before they are informed of disconnection. He reminded, too, that the company makes announcements in advance of the commencement of disconnection campaigns. This is one mechanism in which they give customers the opportunity clear some of their outstanding balance.
Baksh called the $100 reconnection fee proposed by the GCA ridiculous, saying it would put a dent in the company’s finances.
“If we are to reduce as being advocated by the Consumers Association that the reconnection fee to $100, that $100 cannot buy one foot of poly-hose. We must factor in the increasing costs internationally for materials and shipping… most of all materials are imported into this country… that $100 charge is a ridiculous proposal in the context of what is taking place in the economy…,” the CEO highlighted as he urged the PUC against reducing the fee.Baksh argued that the disconnection programme is important for financial viability and sustainability of the utility company.
However, Mahadeo in his argument told the PUC that from their checks, GWIs reconnection fee is the highest of the main utilities services accessed by Guyanese consumers. He also pointed out that even when the fee is paid customers are ask to wait for 48 hours before being reconnected to network.
“There is no limit, no floor, no ceiling upon which an assessment or rather an easement is considered and given. Almost $40 US is the reconnection fee for water in a country where we work for $300 US a month. 13% of a person’s salary…,” said Mahadeo as he painted a grim picture of the punitive fee.
Mahadeo stressed that consumers are deeply concerned over the reconnection rate they are mandated to pay since in their view it is not a cost charge but a “profit making exercise.”
“…consumers do not, as a matter of practice, seek to be disconnected. Too many times disconnection comes because we had to choose what bills to pay first. Who comes first? My child or my water connection? …In case I have an emergency and mind you I have $25,000 cash to balance all of this, so it is not a choice that we want to be disconnected. It is a dire situation that makes us face the embarrassment of disconnection and then have to have a $7,500 knife held to our neck for daring to be disconnected,” Mahadeo lamented.
He also argued before the PUC that even when customers voluntarily ask for service disconnection they are asked to bear the cost for that service to be provided. This, Mahadeo said, should not be and requested that the policy be reviewed.
Jodhan-Khan explained that customers who ask for disconnection are asked to pay a minimal fee of $4,000 for disconnection and $2,000 for reconnection.
Further, Mahadeo pointed out that removing water connection from a residential home breaches the United Nations resolution 64/292 — ratified by Guyana —which recognizes the human right to water and sanitation.
Lifeblood
Baksh, however, countered by saying that since 2021 under the new management the company has implemented several measures to relieve the burdens of customers. He immediately pointed out that even though those measures included a 50% waiver of the reconnection fee, it did not achieve the objective the programme was designed for.
“In 2021, one of the big efforts was what we called the customer assistance programme, in which we granted relief from the debt by 50%. We cut off 50% from the reconnection fees and it did not bear the kind of results we wanted. In 2022, we had the anniversary and we went further, we give 50% discount on what is owed to GWI and we totally reduced or eliminated the reconnection fees for two and a half months,” Baksh said as he explained the measures spearheaded by the company in an effort to bring relief to customers.
He stated that the measures could not be continued as revenue collection is the lifeblood of the company’s operations even though it receives a subsidy from government. He pointed out that at one point the company was in a state of bankruptcy, rendering it unable to purchase chemicals to treat water and forcing plants to distribute untreated water.
