MANILA, Philippines - Consumers may end up shouldering P129 million in interest payments on a P5.7-billion bank loan from China since Metropolitan Manila Waterworks and Sewerage System officials have yet to settle the loan even if the project it funded was completed in July 2012, the MWSS Labor Association said Saturday.
The loan was used to fund the rehabilitation and repair of aqueducts to improve the flow of about 394 million liters of water per day from Angat Dam to treatment facilities and distribution pipes that serve about 15 million Filipinos in Metro Manila, Rizal and Cavite.
The project, however, incurred a cost overrun of P506 million and this is the amount that MWSS administrator Gerardo Esquivel refuses to pay, according to labor association vice president Napoleon Quiñones. The P5.2 billion, the original cost of the project, has already been paid.
He said Esquivel has asked the opinion of the Department of Public Works and Highways and the National Economic Development Authority. The DPWH said there is nothing anomalous about the overrun and the MWSS should pay, while the NEDA has yet to come up with an opinion.
Quiñones noted that under the concession agreement, Manila Water and Maynilad will be forced to shoulder the loan payment and eventually pass it on to consumers.
“Under his authority, Esquivel has the discretion to order the payment of the (P506 million) since (it) does not go beyond 10 percent of the total cost of the project. It is just 9.56 percent. But he… delayed making any direct action,†Quiñones said.
He said the remaining amount of the loan earned P61-million interest in January.
Quiñones said that based on a letter from the Export-Import Bank of China, which lent the money, another P68 million is due and demandable by July 21.
He said the labor union is considering filing graft charges against Esquivel over his alleged inaction.