MANILA, Philippines – President Rodrigo Duterte has the Constitutional power to revoke the supposed “onerous” water supply deals signed with the Philippines’ two biggest water utilities in 1997, his spokesman and legal counsel Salvador Panelo said Thursday.
A furious Duterte on Tuesday slammed Manila Water Co. and Maynilad Water Services Inc. for supposedly milking billions from the people and the government over the disadvantageous 1997 water contract.
He also ordered agencies to draft new utility contracts acceptable to the government.
Duterte threatens to sue water firms for economic sabotage
Maynilad and Manila Water distribute water in Metro Manila and nearby provinces under agreements signed with the Metropolitan Waterworks and Sewerage System (MWSS) during the Ramos administration in 1997.
The Department of Justice (DOJ) recently found out that a dozen “onerous” provisions were stipulated in the deal.
But Panelo explained that the President can rescind contracts entered into by the government if it is proven to be detrimental to public interest.
“Actually ‘yung batas, ang pangunahing tungkulin ng Pangulo ay pagsilbihan at proteksyunan ang taumbayan. (Accoding to the Constitution, the President’s main duty is to serve and protect the public). So on the basis of that, the President can do things that can either annul (or) rescind contracts done or arranged or agreed against the interest of the people and public policy,’ Panelo said in an interview on DZXL.
The DOJ reviewed these contracts upon Duterte’s order during the height of the water crisis earlier this year.
In a statement Wednesday, the Palace official bared that some government officials “purposely guided” the crafting of the disadvantageous 20-year-old water deals.
He also noted that Duterte had ordered the filing of criminal, civil and administrative charges against everyone involved in the utility contracts, including the firms’ owners and government officials for alleged economic sabotage.
The Permanent Court of Arbitration in Singapore has ordered the Philippine government to compensate Manila Water P7.39 billion for losses between June 2015 to November 2019.
Last year, the government was also ordered to pay Maynilad P3.4 billion by the same Singaporean court due to the Philippine government’s refusal to allow it to increase service rates from 2013 to 2017.