Manila Water offers compromise on P7.4 billion award

MANILA, Philippines — Ayala-led Manila Water Co. Inc. is willing to come up with a “workable solution” with the government on a recent arbitration decision that entitled it to indemnification for unenforced rate hike, after President Duterte threatened to sue the water firm for economic sabotage.

In a statement yesterday, the east zone concessionaire said it is working on a mutually acceptable manner of implementation of the arbitral award, noting that the case was filed due to a violation incurred by the previous administration.

“We are more than willing and have started to work with the incumbent administration to come up with a workable solution to the arbitration decision,” Manila Water said.

This developed as Malacañang accused some officials of helping water concessionaires “rape” the economy.

“It is apparent that some members of the government have not only looked the other way, but have in fact purposely guided the hands of those who have raped our economy for their own personal aggrandizement,” presidential spokesman Salvador Panelo said in a statement. 

“Worse, they are hell-bent on bleeding our country dry. The proper delivery of basic services has not been fostered but thwarted to the outrageous detriment of the Filipinos,” he added.

Last week, an international arbitral court ordered the Philippine government to pay Manila Water P7.39 billion in indemnification for losses incurred after being barred from raising rates.

On Tuesday night, however, Duterte threatened to file charges of economic sabotage against Manila Water and the other concessionaire Maynilad Water Services Inc. for “screwing” Filipinos.

Duterte said the concession contracts of the two firms are disadvantageous to the public because they prohibit the government from adjusting water rates.

The President claimed Manila Water bagged the legal victory because the company is “part of the club.” He did not elaborate. He said the Philippines lost the case because it interfered in the company’s application for rate hike.

In defense, Manila Water emphasized that the arbitral award issued in its favor is for acts in breach of the procedure committed by officials of the previous administration.

Upon receiving the award, Manila Water said its chairman Fernando Zobel de Ayala and other senior officials of the company already sought guidance and met with Finance Secretary Carlos Dominguez III before it became public.

“Secretary Dominguez acknowledged our proposal to work very closely with his office to find a mutually acceptable scheme to address the award,” Manila Water said.

Furthermore, Duterte has ordered Solicitor General Jose Calida and Dominguez to draft a new contract that would be “really favorable” to the public and the government.

Maynilad airs side

For its part, Maynilad said it is willing to sit down with government to resolve issues.

“We have not done anything wrong and we hope the President understands that the contract we have inherited was actually written, reviewed and approved by the government at the height of the Metro Manila water crisis in 1996,” Maynilad president and CEO Ramoncito Fernandez told The STAR.

“We only have a view and idea of what they want to be reviewed but we are waiting for formal communication. We are willing to discuss with the government what they want to be reviewed,” he added.

The same tribunal ordered the Philippine government in July 2017 to reimburse Maynilad P3.4 billion for losses from March 2015 to August 2016, and ruled that the water firm is allowed to recover its losses from September 2016 onwards.

Manila Water From Page 5

Maynilad has yet to receive indemnification from the government for the case it won in 2017.

The Metropolitan Waterworks and Sewerage System (MWSS) maintained that it would follow the President’s order and come up with a better contract.

It was in 1997 when then president Fidel Ramos solicited bids for concession agreements with MWSS to address the water crisis in Metro Manila.

Duterte’s Senate allies voiced support for his tough position against the water firms. “I told him I’m supporting him 100 percent on the issue,” Senate President Vicente Sotto III said.

“I support President Duterte’s desire to assail these onerous contracts that deprive Filipinos of both their right to water as well as impose liabilities upon the Philippine government even when service in supply fails,” Sen. Imee Marcos said.

Sen. Francis Tolentino said it is within Congress’ oversight powers to investigate the water firms.

For some administration lawmakers, allowing a third player may provide the answer to the country’s water woes.

“There is more than enough room for at least three more water concessionaires in the country to effectively address huge gaps in water service reliability, safety and affordability,” Rep. Bernadette Herrera of party-list Bagong Henerasyon proposed.

Herrera is an author of House Bill 2171 creating a Water Regulatory Commission.

“We salute President Duterte with both hands and hail his strong statement castigating these two water concessionaires. Again, he has proven that he has the political will to stand up to these oligarchs and free the Filipino people from their clutches,” Rep. Lito Atienza of party-list Buhay said.

Militant group Bagong Alyansang Makabayan dared the administration to revoke the government’s contracts with the two water concessionaires and sue them for economic sabotage.

“Just do it,” said Bayan secretary general Renato Reyes. “We agree with the DOJ (Department of Justice) findings that there are many lopsided and questionable provisions in the contracts that are inimical to consumer interest.” – With Alexis Romero, Delon Porcalla, Paolo Romero, Elizabeth Marcelo