Refund before rate hike, solons urge water firms

MANILA, Philippines–Water concessionaires Manila Water and Maynilad should first refund their customers for the billions in fees they charged for water and sewerage projects that were not implemented before raising their rates, opposition lawmakers said.

Bayan Muna Representatives Neri Colmenares and Carlos Zarate on Wednesday assailed the two concessionaires for the rate hikes—a P10 to P20 increase for Manila Water’s residential customers consuming 20-30 cubic meters a month, and a P9 increase for Maynilad’s residential customers using 30 cubic meters every month.

Manila Water services the east zone of Metro Manila, while Maynilad services the west zone.

“Manila Water and Maynilad must first refund billions of pesos it collected from the public for still unimplemented water projects before it could talk about increase water charges,” Colmenares, the senior deputy minority leader, said.

Unimplemented

He cited the P5.4-billion Angat Water Reliability, and P45.3-billion Laiban dam projects as examples.

“The Metropolitan Waterworks and Sewerage System-Regulatory Office (MWSS-RO) should not have approved the rate hike because the two private water concessionaires have yet to refund to their respective customers the more than P6 billion they have collected for unimplemented water and sewerage improvement projects, along with the dam projects,” Colmenares said in a statement.

Colmenares said it was also unfair to consumers who were never given direct access to information into the formula used as basis for the MWSS-RO to approve the hike.

“They have not given the public the opportunity to challenge the increase. Public information and consultation are imperative requisites that the MWSS-RO, which supposedly serves as the protector of public interest, has totally denied to the populace,” he said.

Business risk

Zarate said consumers have no responsibility to shoulder the capital used by companies or help them recover their losses. “That is a risk businesses take and it should not be passed on to consumers,” he said.

“Also in other businesses, they are the ones who absorb bad business decisions and business risks like the foreign currency differential adjustment, and pay their own taxes but these water concessionaires are raking in billions by fooling us,” he said.

“They even pass to consumers losses due to changes in foreign exchange rates. But in this case, the concessionaires borrow from foreign creditors without any qualms knowing that they are insulated from the risk ordinary borrowers take because they’re allowed to pass on their forex losses to their consumers,” he said.

“It is like having their cake and eating it, too,” Zarate said.

600 percent hike

Since the privatization of water utilities in 1997, Maynilad and Manila Water have increased water rates by 600 percent, he said.

“They are also passing on their income taxes, value added tax, documentation stamps and other taxes to consumers. According to the Water for the People Network, this has been going on for seven years and now amounts to at least P15 billion,” he said.

Zarate urged his colleagues in Congress to investigate these “unfair and anti-consumer practices.”