WATER IN the Middle East is too precious a resource to be squandered or carelessly managed, but that's exactly what's happening in the West Bank, where disgruntled customers are complaining of sky-rocketing rates, lack of an answerable authority and, in some cases, extremely poor service.

Nowhere is this mismanagement felt more acutely than by those who receive their water courtesy of the Jerusalem Water Undertaking, a public-private organization that manages water resources in the Ramallah area and in parts of Jerusalem.

"The [Jerusalem] Undertaking is full of bosses and everybody works as he wishes," says Abu Ibrahim Barakat, a Ramallah mechanic who has experienced problems with his water bill. "They raise the rates whenever they like, in the way they like; there is no follow-up or auditing. As we say, "When there is no one taking care of the money, it teaches people how to steal."

"They charge us NIS 350 [$85] every two months," complains Al-Bireh resident Fatimah Al'ori, mother of two youngsters and a teacher in a government school. "As you can see, we live in an apartment and we have no cars to wash day and night, nor a garden to water, nor a swimming pool."

"This bill caused me trouble with my husband. He accused me of wasting water," she adds. "We also wrongly thought that our neighbors were using the water meter illegally," she adds.

Water rates in the Ramallah area have risen steadily during the past three years. In 1998, each cubic meter of water (for bills less than 40 cubic meters) cost NIS 2.5. By the beginning of 1999, the rate had nudged up to NIS 3.3; by year's end, customers were paying NIS 3.7 per cubic meter.

General Director of the Jerusalem Water Undertaking 'Abdul Karim As'ad insists that the Undertaking's rates are "not much different from rates in other areas [of the West Bank]."

According to his figures, the current average water rate is NIS 4.75 per cubic meter and is divided into classes according to usage. If a customer uses less than 20 cubic meters in a two-month period, the rate for each cubic meter is NIS 3.5. If a customer uses less than 40 cubic meters, the rate is NIS 3.8. If their bimonthly consumption exceeds 41 cubic meters, the rate jumps to NIS 5.3 per cubic meter.

Five months ago, the Jerusalem Water Undertaking tried to levy a new rate, charging consumers who use more than 40 cubic meters in a billing period double the lowest rate, or NIS 7 per cubic meter Complaints were lodged and the undertaking rescinded the move.

However, water in Ramallah, al-Bireh and their environs is still the most expensive in the West Bank.

"There is no strong economic, legal or institutional justification to explain why the rates in the Jerusalem Undertaking are higher than in other areas like Jenin or Jericho," says the head of the Palestinian Hydrology Group, Abdul Rahman Tamimi, whose organization conducts independent research on water in the West Bank and Gaza.

"Why do residents of Ramallah have to pay [up to] NIS 5 per cubic meter, whereas the rate in other areas is a maximum of NIS 2 and despite the fact that the Undertaking owns a big chunk of the water resources? Other areas have to buy all their water from Israel and still have rates one half [those of Ramallah]," says Tamimi.

The Undertaking's As'ad calls the price difference "minor" and says that many factors effect the cost of pumping the water, including geography that varies from region to region. "Because it is mountainous in Ramallah, it requires more electrical power to pump the water and more workers and technicians, which are all incorporated into the cost to the consumer. We depend 60 percent on the water we buy from the Israeli Mecorot Company; if we don't raise the rate when Mecorot does, we lose a lot of money."

But Hazem Arafat, a member of the al-Bireh Municipal Council, says the Ramallah area's geography does not fully explain the rate increase. "Jericho, for example, has a similar situation with its main spring, Ein al-Dyuk , and must buy nearly the same amount of water from Mecorot. They also have to pump the water to high areas, and the water rate is still 20 percent lower than that in Ramallah." The base rate for water in Jericho is NIS 1.6 per cubic meter.

Arafat also argues that Mecorot's rates have remained at a steady NIS 1.3 per cubic meter for several years, while the Jerusalem Undertaking's rates have risen. In addition, he points out that the Jerusalem Undertaking sells water to nearby Israeli settlements at a rate lower than the rates for Palestinian citizens.

It is important to note that two members of the municipal councils of al-Bireh and Ramallah and one member from each of the local councils of Kufar Malik and Dir Dubwan sit on the board of the Jerusalem Undertaking. The seven-member board (including one member from the Palestinian Water Authority, the budding water ministry) is responsible for overseeing the Undertaking's work.

Yet, the Ramallah region is not the only area where citizens have complaints about their water services. In Nablus, the municipality is the sole water distributor in the area, and prices for the city are different than those in surrounding villages.

Nablus Mayor Ghassan al-Shakah discusses what makes his municipality different than other water establishments: "The Nablus municipality owns its water resources, and we buy no more than one percent of the water we need from the Israeli company. We also have the authority to search for new water resources."

It seems that these advantages do not protect city customers from high rates of NIS 3.36-5.6 per cubic meter, depending on the rate of consumption. Yet even these rates are lower than Ramallah's, even though Nablus sits amid steep mountains and the municipality must pump its water from three wells.

Part of the reason for the present state of confusion, says Tamimi, is that different organizations are distributing water in different parts of the West Bank. "The various parties planning and dealing with the water sector on a geographic basis are causing the mismanagement of these resources by the water supply institutions."

With so many different parties involved, who exactly sets water rates in each area? "All municipalities, local councils and authorities should get the ratification of the [Water] Authority before any raise or change in the water rates," says Ihab al-Barghothi, the Water Authority's economic adviser. "We study the attached reasons and how the increase in the rates will effect the citizens."

Yet in Nablus, Shakah says the municipality sets the rates without interference from the Water Authority. "Our relationship with the Water Authority is limited and does not go beyond issues regarding the Israelis and water problems with them. If we decide to raise the rates, we do not consult [them]," he says.

As'ad of the Jerusalem Undertaking says something different. "It's obvious to us and to the citizens that before we change the rate we should get approval from the Palestinian Water Authority. We submit all the data and the justifications for the raise, and after that the Authority either agrees or disagrees."

Yet earlier in the same interview, As'ad said that the relationship between the Undertaking and the Authority "does not exceed the fact that the Water Authority is the organizer of the water sector regarding implementation of Palestinian national water policy. According to its legal stipulations, [the Authority] does not and should not carry out any operational workings but only organize water relations between the various neighboring countries."

Perhaps this double-speak is what has allowed the Undertaking to raise rates from September 1999 through February 2000, then rescind them in response to citizen protest.

Tamimi points to another determining factor, what he calls "the morality of senior officials in the municipalities, undertakings and local councils." He says none of these parties consult with any other official party to set their rates, and they fail to give people a share in the decision-making. "As a result," he adds, "people are not prepared for the rates or for a rate hike."

What does it mean for the average citizen when rates are doubled if a family uses more than 40 cubic meters every two months (one billing period)? In Israel, a few kilometers from the Palestinian-controlled areas, the average individual uses 31.25 cubic meters per month. The average individual worldwide uses 66.6 cubic meters every month, according to World Bank numbers.

That means, that if the average West Bank family (6.6 persons) wants to keep household costs down, each individual must restrict his or her use to a mere 3.03 cubic meters a month, a fraction of the world average and certainly not enough for regular household use.

Mismanagement has another ugly side, which is poor consumer service, according Hasan Khreisheh, a legislative council member from the Tulkarem district. Complaints range from poor water quality to frequent water shortages.

"The old networks are rusty and cause a lot of health problems from water pollution," Kreisheh says. "In addition, the process of water purification is irregular."

In addition, the confusion in the management of water resources results in preferential treatment for some consumers. According to one anonymous source, in times of water shortages, when some consumers are having their supply cut, "there is a lot of pressure on the water supply associations, especially on the Jerusalem Water Undertaking, from ministries and officials in the Palestinian Authority to provide their homes with water."

Though he denies any favoritism, 'Abdul Karim As'ad says collecting the debts of the Palestinian Authority and its ministries and offices is, "the most difficult process because it requires time and effort and familiarity with the [appropriate] party."

During droughts, some consumers, in desperation, resort to stealing water. Take for example, the situation in the Bani Zaid area, north of Ramallah.

Mayor Mahmoud Hilal says his constituents have endured recent cuts in the water supply lasting as long as 40 days. "We had to use spring water, even though we knew it was polluted," he says. "We were boiling it and then drinking it because we are unable to buy good water from the neighboring village of Salfit, which costs more than NIS 20 per cubic meter."

Yet, Hilal adds, consumers must pay a minimum fee, even if they are not consuming any water. "The water bills reach our pockets before the water reaches our houses," he says. "After a while, the citizens revolted." Once the Bani Zaid citizens complained, they were told by the Undertaking that the water was already flowing in their area. They discovered, however, that because they were at a high elevation, the water was not reaching them. Yet when residents turned on their taps, to release the pressure in the pipes, their water meters began to run, counting false cubic meters that later showed up on their bills. "We were paying the prices for the air in the house, although it is free outside of the house," says Hilal. To get water, "everyone who knows a plumber brings him to make illegal connections from the water main."

In neighboring Turmous Aiya, the water cuts off four or five times a week, says Mayor Mohammed Jamil. "We always complain about the water cuts, but the Undertaking does nothing even though this season was a good one for rain."

Complaints about the price of water raise questions about the management of the water institutions themselves. "As I see it," says Tamimi, "the internal expenses in the Jerusalem Water Undertaking are the main reasons for the high rates." He says that because the Water Undertaking is legally a non-profit establishment or a semi-public company, its administrators are "obliged to make their accounts appear to be without profit."

The anonymous source mentioned above claims that there are "a number of employees inside the Jerusalem Water Undertaking paid high salaries reaching up to $4000 per month." The source also says that several positions have been created within the institution that will pay between $2500 and $4000 per month, in addition to expenses.

Hazem Arafat of the al-Bireh Council confirmed this information, saying employee salaries at the Jerusalem Water Undertaking are among the highest in the area. In addition, he says members of the Undertaking's board of directors are paid an annual stipend of JD 5000 ($7,100). "Their work is supposed to be voluntary, as they represent their municipalities and local councils in the Undertaking and as it is a non-profit establishment."

Asa'd refutes that salaries in the Undertaking are too high. "Salaries in all municipalities and other establishments make up 55 percent to 60 percent of expenses, but in our Undertaking, they do not make up more than 25 percent [of expenses]."

He also says, "It is normal in any part of the world that the salaries of water sector employees who work on call and on 24-hour emergency [basis] are high, in order to provide incentives." Asa'd says the Undertaking has created four new administrative positions, and their total salaries plus annual raises do not exceed one percent of the expenses.

Al-Barghothi of the Water Authority conceded that management of the water sector is under scrutiny, particularly in regard to the Undertaking. "It could be true. We've heard it from more than one party, and we are watching this issue."

While the Undertaking currently functions as a semi-private institution, several sources say that the Palestinian Authority is exploring the possibilities of privatization. If true, consumers should be warned by the Authority's previous ventures in privatization (see "Monopoly's High Price").

Says Nablus Mayor Shakah of the coming transition, "It's a good step forward to promote this sector. It is not a money-making project as understood from the definition of "privatization," but it is a public-private project to ensure the interests of the homeland and the citizens regarding accessing water and good service. Instead of having the municipality or the undertaking paying the development or repair expenses, the private company will pay."

Tamimi warns that consumers should be wary of this. "Water should be among the services directed by the state because it is public property ... If the citizen is now unable to pay the water bills while these institutions are supposed to be non-profit, what will the situation be if this sector is directed by a private company whose stated and hidden aim is profit?"

Water Authority representative al-Barghothi says that privatization is not an accurate way to describe what will happen. "The private sector will play a role in the process of administration, but the water resources will stay owned by the public sector," he says.

Al-Barghothi says financial and technical proposals will be taken from local and foreign bidders. "After that the private sector will be observed," he explains. "It could, of course, gain the administration through a concession given to the private sector with the presence of continuous observation by the Water Authority and municipalities and local councils and undertakings."

He says that it would be usual for the private company to apply to the Authority, local governments and the undertakings to raise the rates with improvements to the water infrastructure. "In this case, these three sides have to study this offer and to decide whether to accept or to decline. The goal of these parties will be to serve the citizen, not to increase the profits of the private company."