Manila Water’s overflowing greed

Atty. Dodo Dulay

Atty. Dodo Dulay

Lest the public forget, it isn’t only power plant operators underhandedly squeezing more money from ordinary Filipino consumers.

A few months ago, consumer welfare groups also exposed the disturbing lack of moral conscience of blue-chip water concessionaires who tried to jack up water rates by 15 to 17 percent even while they’ve been passing on practically all of their corporate expenses—including income taxes amounting to P3.1-billion annually and other expenditures totally unrelated to the actual delivery of water services—to consumers’ water bills.

These corporate behemoths already earn billions of pesos in profit. Yet, they still have the nerve to wring out more profit from Filipino households already overburdened by the rising costs of basic commodities.

Despite the loud public outcry, the water concessionaires are apparently hell-bent on pursuing the rate increase.

Late last year, the Metro Manila east zone water concessionaire, Manila Water, formally filed a notice with the International Chamber of Commerce to challenge the decision of the MWSS-Regulatory Office (MWSS-RO) denying not only the company’s rate hike petition but also ordering the water provider to reduce their water charges by P7.24 per cubic meter.

The west zone concessionaire, Maynilad Water, also filed a similar notice to resolve its rate dispute with the MWSS.

The issuance of the dispute notice officially marks the start of the arbitration process.

Thick-faced greed
We are appalled, to say the least, that a Manila Water official even had the temerity to say that the MWSS-RO’s decision should not be implemented while the arbitration is on-going. To this we remark: “Saan kayo kumukuha ng kapal ng mukha? [Where do you get the gall?]”

The MWSS should not allow itself to be dictated upon. They should stand pat on their decision and compel the concessionaires to implement its rate reduction order until restrained by our courts.

In our radio program “Karambola sa DWIZ [882AM],” we’ve been quite vocal in our criticism of the MWSS in the past, arguing that they should be more proactive in protecting the interests of the general public.

We were pleasantly surprised that the MWSS appears to have taken up the cudgels for ordinary Filipino consumers. To my mind, this belated change of heart by the government regulator mitigates the agency’s past mistakes when it chose to turn a blind eye to these obviously one-sided concession agreements.

We just hope this is not merely a moro-moro on the part of the regulators and the concessionaires. For now, we are willing to give the MWSS the benefit of the doubt and the public should support them for deciding against corporate vultures masquerading as models of corporate social responsibility.

But the MWSS should go a step further and undo the anti-consumer practices of these concessionaires.

According to advocacy groups, water concessionaires have been unfairly charging their taxes and other expenses like foreign trips, donations, beauty contests, golf games—and even the costs of its arbitration suits against MWSS—to their customers.

Manila Water, for instance, is enjoying this perk even while it’s rolling in dough. A few months ago, the company announced it would distribute cash dividends to shareholders for the second semester of last year. This after it was reported that the company’s net income rose by 11 percent to P2.9 billion in the first half of 2013.

It is infuriating to see Manila Water luxuriating in a pile of money at the expense of the cash-strapped, ordinary wage earner. Why squeeze those who already don’t have much to spare? Isn’t that too much greed?

Expect the concessionaires to defend its position against the rate reduction decision of the MWSS on all fronts: legal, extra-legal, media and probably all the way up to the corridors of power.

We’re sure Manila Water will also invoke its concession agreement with government to justify its “legalized extortion” of Filipino consumers, particularly the vague provision on what constitutes recoverable operating expenses.

The way we see it, it’s about time the Aquino administration extricated Filipino consumers from these grossly onerous concession agreements. Doing nothing will only confirm the public’s suspicion that PNoy is beholden to Big Business like the Ayala-owned Manila Water instead of his so-called “bosses.”

Perhaps PNoy should start by looking into the highly dubious 15-year extension of Manila Water’s concession agreement (up to 2037), a mere ten years into its original 25-year contract, during the waning days of the Arroyo administration.

We’re also sure there are enough brilliant minds in government who can think of a way these concession agreements can be renegotiated or even revoked. As we’ve been taught in law school, government contracts are not carved in stone especially if it’s grossly disadvantageous to the Filipino people. Public interest must always prevail.

We have other water-related public interest issues that we want Manila Water to explain but we will discuss them in our future columns.


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