Struggling to hand over clean water plant in Yen Thanh district

Transfer of state assets to enterprises

Tho Thanh is a lowland commune of Yen Thanh district, 15 km northeast of the district center, with 2,820 households, 10,814 people, divided into 10 hamlets. In 2004, this locality invested in building 1clean water plantto provide clean water for people; officially put into use in 2005.

Initially, the water plant was designed to supply water to 419 households, equivalent to 1,680 people in 3 residential areas, with a water usage of 60 liters/person/day and some administrative and public service units of the commune center. The investment value at that time was about 2.5 billion VND, of which the locality had to contribute about 20%. After many stages of upgrading and renovation, the project has been connected and expanded to serve more than 1,600 households in the whole commune, an increase of nearly 1,200 households compared to the initial water supply design scale (an increase of over 300%) that had been invested.

Although the project was invested from the State budget and from the Central Government's capital, since its operation, this factory has been assigned to many individuals and non-State units to manage and operate under a contract model. In particular, there was a time when the individual receiving the contract did not ensure the payment of the contract money to the locality, the debt lasted up to more than 200 million VND, causing the local government to file a lawsuit in the People's Court.

Since May 2018, Tho Thanh Commune People's Committee has contracted the management and operation of the project to Hung Dung Construction Investment and Consulting Joint Stock Company (registered in Dien Chau District). Initially, the contracted amount that this unit had to pay to the local government was 10 million VND/month; however, it has now been reduced to 5 million VND/month.

However, according to regulations, the locality's assignment of the project to an enterprise for management and operation without a decision from the Provincial People's Committee (the Provincial People's Committee decides on the method of assignment of the project) is not within its authority and does not comply with State regulations. On the other hand, the handover is not in accordance with the legal procedures and processes of current law (when handing over, the Provincial People's Committee's opinion is not sought), the assets have not been assessed before handover and the necessary procedures have not been completed, and the procedures for selecting a unit with sufficient capacity and expertise to manage and operate have not been completed.

Not to mention, although contracted to a private unit, up to now, this water supply project has not been able to ensure water supply operation for the current scale, not to mention the system has degraded, lost water locally and been severely damaged after 18 years of operation. In addition, due to the expansion of the water supply scale to more than 1,600 households compared to the initial scale of more than 400 households, not at the same time as the investment to upgrade the treatment capacity of the plant, the volume of the raw water reservoir is too small, about 2,000 m³only enough for 2 days/18 days of water.

In addition, the expansion of water supply scale is not accompanied by the replacement, upgrading, repair and maintenance of water supply network (transmission network, distribution network) to ensure the flow of clean water. This has caused a very high rate of water loss in the network, many hamlets at the end of the pipeline have no water to use.

Struggling to handle

Regarding the issue of local authorities contracting out construction works to enterprises, Mr. Vo Thanh Dong - Chairman of Tho Thanh Commune People's Committee said: After the water plant was completed, because the locality did not have enough human resources to operate and manage, it signed contracts with a number of individuals and units in the area. However, due to limited capacity and experience in organizing, managing, operating and exploiting, many individuals and units operated ineffectively, causing great losses, and even owing local authorities money for contracting. By May 2018, the Commune People's Committee signed a contract with Hung Dung Construction Investment and Consulting Joint Stock Company and this enterprise spent money to invest in building new items and upgrading and renovating to ensure the supply of domestic water for current households; in addition, it also expanded water supply to Dien Lien and Dien Xuan communes (Dien Chau)...

Mr. Dong also said that the management handover is currently facing many difficulties in terms of documents and procedures, and is not yet final. Meanwhile, the demand for clean water for daily life is increasing, requiring investment in upgrading the scale of the plant. The Commune People's Committee has repeatedly proposed to hand over to individuals and businesses so that they can proactively manage and invest in developing the water plant, but it has not yet been resolved. Because the official handover procedures have not been completed, businesses have not dared to continue investing...

Ms. Dang Thi Dung - Head of Finance - Planning Department, Yen Thanh District People's Committee said: Regarding the handover of clean water supply works in Tho Thanh commune, the district is also guiding the locality to carry out the procedures according to regulations. For the handover of this work, it is currently necessary to comply with Decree No. 43/2022/ND-CP dated June 24, 2022 of the Government regulating the management, use and exploitation of clean water infrastructure assets. According to this Decree, the State encourages socialization to mobilize and diversify resources to maintain, develop and exploit clean water infrastructure assets. However, the implementation must comply with State regulations.

According to Ms. Dung, the transfer of assets, which are clean water infrastructure, will be decided by the Provincial People's Committee. However, according to Clause 2, Article 7, Decree 43, the Commune People's Committee must prepare a dossier to request the transfer of assets to the specialized agency on clean water supply for exploitation. To do this, it is necessary to complete the assessment of the remaining asset values, based on the investment decision, the amount of money spent on investment, annual upgrades, depreciation value, etc. "Currently, the steps to assess the remaining asset values ​​are being carried out, the district also wishes to hand over as soon as possible to continue managing, operating, and promoting the effectiveness of the project, aiming towards a safe and sustainable water supply model to meet the needs of the people in the area", Ms. Dung emphasized.