JUSTICE Secretary Menardo I. Guevarra said on Tuesday there were no major contentions between the government review panel and Maynilad Water Services Inc. during initial discussions for the drafting of a new water concession agreement.
Guevarra described last Monday’s meeting between the parties as “smooth and easy.”
“Except for a few matters pertaining to Maynilad business plan, JICA [Japan International Cooperation Agency] loans, and public listing of shares, the parties are in agreement on the rest of the proposed new concession agreement with Maynilad, which takes off from a similar concession agreement with Manila Water,” he said.
The parties are expected to iron out kinks in their negotiations before the current concession agreement with Maynilad expires next year.
Last March, the government through the Metropolitan Waterworks and Sewerage System (MWSS) and Manila Water signed a new concession agreement which is expected to pave the way for “better overall service and more reasonable charges to consumers.”
The Department of Justice chief made an assurance that certain provisions that are in the revised concession agreement with Manila Water would certainly be also part of the agreement with Maynilad.
These “non-negotiable” provisions included the removal of the non-interference clause, the non-chargeability of corporate income tax to consumers’ water bills, no government guarantees for future debts, conduct of an audit by the Commission on Audit, and a more transparent governance mechanism.
President Duterte pushed for the signing of new water concession agreements between the government and the two water concessionaires after discovering “onerous provisions” in the existing contracts and after the ruling of the Permanent Court of Arbitration (PCA) in Singapore. PCA issued a decision stating that the Philippine government should pay P7.4 billion to Manila Water and P3.4 billion to Maynilad for the losses they incurred from an unenforced water rate hike.