The signing of the new concession agreement (CA) between the government and Maynilad Water Services Inc. (Maynilad) has put on track the Duterte administration’s water security program, Metropolitan Waterworks and Sewerage System (MWSS) Chairman and Acting Administrator Reynaldo V. Velasco said.
“The signing of the new concession agreement is a big step towards water security and it’s a win-win for all stakeholders,” Velasco said in a statement.
He said he is optimistic that with the new agreement, various water security projects can now move forward.
Velasco said public-private partnership is still the “best option” for water infrastructure, noting that Maynilad’s capital expenditure projects will rehabilitate and replace old pipelines, install new pipes in unserved areas, construct new pumping stations, reservoirs, and treatment facilities, that will result in better service to its customers.
Maynilad services the west zone concession area which is composed of the cities of Manila (certain areas), Quezon City (certain areas), Makati (certain areas), Caloocan, Pasay, Parañaque, Las Piñas, Muntinlupa, Valenzuela, Navotas and Malabon—all in Metro Manila; the cities of Cavite, Bacoor and Imus, and the towns of Kawit, Noveleta and Rosario in Cavite Province.
It operates and maintains over 6,800 kilometers of pipelines and delivers over 2,000 million liters of potable water daily to its customers. It has 35 pumping stations, 32 water reservoirs and 28 in-line boosters across its service area. Its reservoirs have a total holding capacity of over 700 million liters of potable water.
The government earlier signed a renegotiated CA with Manila Water Company Inc.
Following the template of the new Manila Water CA, the new Maynilad CA eliminated “onerous” provisions detrimental to the interests of the government and the consumers even as it guarantees the economic viability of the concessionaire’s capital investments, Velasco said.
According to Justice Secretary Menardo I. Guevara, head of the panel that reviewed the CAs of Manila Water and Maynilad, “onerous” provisions, such as the non-interference clause and “burdening consumers with corporate income tax” were removed.
“Contingent liabilities of the government have been substantially reduced, and a framework for better service to the public has been put in place.”
With the signing of the new agreement, Maynilad will impose a tariff freeze until December 31, 2022.
It will also forego collecting the P3.4-billion compensation from the government.
To recall, the Permanent Court of Arbitration in Singapore has ordered the government to pay for the losses incurred by Maynilad because of Manila’s refusal to approve a water rate hike.
The revised CA was the outcome of a thorough review and negotiations conducted by a government panel led by the Department of Justice based on an order from President Duterte last year.
The 1997 CAs with water concessionaires Manila Water and Maynilad were signed and took effect during the Ramos administration, ushering a private-public partnership for the water sector.
The 25-year 1997 CAs were extended for another 15 years pursuant to MWSS Board Resolutions in 2008 and 2009.
Image courtesy of Contributed photo