MANILA, Philippines — Bayan Muna Chairperson Neri Colmenares on Friday called for the halt of water utility privatization following the water rate increase by Manila Water Company.
According to Colmenares, the privatization of the water concession only burdens the consumers. He also called for a review of the rate hike agreement.
“Water, as a basic necessity, must be managed by the state. The privatization of water utilities has resulted in exorbitant rates that continuously exploit the Filipino people,” Colmenares said in a statement.
The Bayan Muna chairperson also said that consumers have been facing “staggering” increases in rate hikes since the privatization of the Metropolitan Waterworks and Sewerage System (MWSS) in 1997.
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“The privatization model has failed, as evidenced by the numerous water interruptions and the failure of concessionaires to fulfill their obligations. The state must reclaim control to ensure fair and equitable water distribution,” he added.
MWSS announced on Monday that the Manila Water Company will be implementing a hike of P0.86 per cubic meter starting on October 1. Manila Water consumers using 16 cubic meters will have an increase of P8.10 in monthly water bills and a P16.54 increase for those using 30 cubic meters.
Meanwhile, Maynilad will decrease its rate by P0.29 per cubic meter. Maynilad consumers with 20 cubic meters will pay P3.14 less while the water bill of those with 30 cubic meters will go down by P6.43.
The rate hike is due to the foreign currency differential adjustment (FCDA). FCDA is a tariff mechanism granted to the concession to recover from losses or give back gains due to movements of foreign currency.
READ: Manila Water, Maynilad adjust rates starting October
Colmenares noted that FCDA justifies the rate hikes, adding that “[c]onsumers are forced to shoulder additional charges, which include a 12% VAT (value added tax) and a 20% environmental charge, on top of the FCDA.”