Losing water firm paid execs P11.6M - lawmaker

MANILA, Philippines - A subsidiary of the Local Water Utilities Administration (LWUA) paid its executives a total of P11.6 million in 2010 despite losing more than P25 million, Cagayan de Oro City Rep. Rufus Rodriguez said yesterday.

Citing a Commission on Audit (COA) report, Rodriguez said LWUA Consult, Inc. earned a total income of P6.83 million last year but incurred losses amounting to P25 million.

He said the excessive allowances and salaries of members of the boards of directors and officers of LUWA Consult accounted for nearly half of its losses.

“The board chairman earned P1.6 million, his five colleagues in the board pocketed more than P6 million, while the other officers were paid P1.7 million. Additionally, they received P2.8 million in representation, transportation and incentive allowances,” he added.

He pointed out that in 2009, the LWUA subsidiary paid its directors and officers excessive salaries and allowances while losing P18.59 million.

Rodriguez did not identify the board members and officers of LWUA Consults, Inc., but a check with the LWUA website showed that the subsidiary’s directors were former congressman and then LWUA chairman Prospero Pichay Jr., Eduardo Bangayan, Aurelio Puentevella, Daniel Landingin, Proceso Domingo, Emmanuel Malicdem, Wilfredo Feleo, Edwin Ruiz, and Arnaldo Espinas.

Its officers were Proceso Domingo, president and chief executive officer; Edwin Ruiz, executive vice president; Armando Fernandez, vice president for technical operations; Alfredo Espino, vice president for business development; and Ellen Te, vice president for administration and finance.

Pichay, a staunch ally of the Arroyos, has been replaced as LWUA chairman. He is facing charges before the Department of Justice in connection with a water agency’s acquisition of a thrift bank that was on the verge of collapse.

LWUA formed its subsidiary in 2009 “specifically to augment and complement LWUA in its primary task of promoting and developing provincial water supply systems by providing specialized technical assistance to local water utilities and other water supply developers and providers.”

Rodriguez said it is clear that the mandate of LWUA and its subsidiary “are one and the same.”

He said the subsidiary was formed so that LWUA could pay more emoluments to its officers who sat in the board of LWUA Consult.

He called for the abolition of the losing subsidiary.