PSIREN

Public Services International (PSI) Asia Pacific Regional office hosted a Forum on ‘Electricity Reforms in Indonesia and Asia Pacific: Role of ADB/IFIs’ at Novotel Nusa Dua Hotel, Bali, Indonesia on the 2nd May 2009. Participants representing PSI electricity unions from Asia-Pacific joined the forum. Speakers from Philippines, Bangladesh, India & Indonesia shared their experiences on the impact of the reforms in the electricity sector vis-à-vis the role of the Asian Development Bank (ADB).

‘The government of Indonesia is corporatizing the PLN as a short cut to unbundling the electricity industry; we challenged the electricity law in the constitutional court and stopped unbundling earlier, but the government is bent upon disintegrating the sector on the advice of ADB” said Mr. Daryako, President of PLN union of Indonesia. PLN is the state-owned and-controlled power utility.

Mr Fabby Tumiwa of the Jakarta-based Institute for Esssential Services Reform (IESR) traced the development of power sector reforms in Indonesia and the role of international financial insitutions like the ADB, World Bank and Japan Bank for International Cooperation (JBIC) in providing loans and guarantees, as well as promoting private sector participation and restructuring and unbundling of the power industry.

Mr. Hafizul Hossain of PGCB Sramik Karmachari Union of Bangladesh said: “Bangladesh Power Development Board has been disintegrated many times over the years and the corporatization/ privatization is still ongoing; the private corporations have thrown out skilled electricity workers but have retained the officers. The workers’ rights and job security are the main causalities in the reforms process.”

Mr. Vinay Pandey of the All-India Engineers Association and from the largest State in India – Madhya Pradesh, said: “The biggest problems with reforms has been the lack of capacity addition in the sector as advocated by ADB; the excess dependence on private sectors in the post-liberalisation era has forced the entities to purchase power at high cost, breaking them financially”. Mr. Pandey highlighted that the interaction with the employees and unions was negligible on the ADB power project in Madhya Pradesh. Further, the Employees Transfer Scheme was announced unilaterally without any consultation with the stakeholders and despite the ADB’s claim, many key labour issues remain unresolved. A national survey revealed that the best run electricity boards in India are the ones that are operating as integrated entities and not based on the ADB model.

Mr. Luis Corral from the Asian Labour Network on International Financial Intermediaries (ALNI) urged ADB to take a hard second-look at its privatization strategy. “The disastrous power sector loan in the Philippines has resulted in a spiraling power tariff as an acquisitive and socially unaccountable private sector runs roughshod over an ADB-designed regulatory and legal regime”, he said. Private cross-ownership is rife resulting in unfair deals and stranded costs of Independent Power Producers (IPP) contracts that are being paid for by taxpayers and consumers to the tune of 11 billion US$ for the next ten years.

Mr. Greg Mclean, from Australian Services Union (ASU), Australia and the PSI Asia Pacific Utility Coordinator moderated the forum and reiterated the demand of PSI to establish a labor desk within ADB. “The victories in the court cases in Indonesia on the constitutionality of Electricity Act and in Philippines on the illegal termination of employees reiterate that the labour unions can challenge the governments and ADB on issues of national interest” Mr. Mclean urged the unions to monitor ADB on the information disclosure of projects.

Mr. Katsuhiko Sato , Regional Secretary of Public Services International Asia Pacific wanted elaboration on the criteria - referring to ADB President Haruhiko Kuroda’s statement made during meeting with the Civil Society organisations earlier in the day that ADB is not advocating privatization or unbundling of electricity sector as the only viable option and that no one-model fits all. The meeting concluded with a note to continue the dialogue and negotiations with the ADB to address the workers concerns. [For more info & ppt presentations, see: http://psiaponadbforum.org/index.php?limitstart=4 \]