MANILA, Philippines — A top Palace official revealed yesterday that water concessionaires Maynilad and Manila Water will not be able to pass on taxes to their consumers and the government will be empowered to stop water rate hikes under the new contracts being drafted.
Cabinet Secretary Karlo Nograles said the new agreements should ensure the continuity of the government’s regulatory functions while assuring consumers that they would not be paying for the taxes the concessionaires should pay the government.
He noted “three standout onerous provisions disadvantageous to the public” that prompted the government to renegotiate the contracts. These include one that allows concessionaires to pass on to consumers their corporate taxes, which have nothing to do with water distribution, and another allowing conflicts to be resolved by international arbitration and may involve sovereignty issues.
Nograles defended President Duterte’s decision to scrap the old deals.
“Water service providers are public utilities and as such are imbued with public interest. Government is duty-bound to protect the interests of consumers, to identify flaws in existing agreements and to ensure that these are remedied moving forward,” he said.
He added that the “government is being reasonable by going to the negotiating table and providing the water concessionaires with the opportunity to right what is wrong.”
“We are willing to negotiate, but the private sector must understand that the welfare of our people, that is non-negotiable,” Nograles stressed.
Party-list Rep. Bernadette Herrera of Bagong Henerasyon and Rep. Arlene Brosas of Gabriela both called for transparency in the new deals and urged the Palace to reveal these to the public.
“The Filipino people must never again be forced to suffer the consequences of onerous and unconstitutional water service contracts,” Herrera said as she suggested its publication either on Facebook or in a newspaper of general circulation.
She also asked the Philippine Competition Commission “to issue anti-monopoly regulations covering all public utilities, including water districts and electricity service jurisdictions nationwide.”
Brosas, for her part, questioned the lack of transparency in the ongoing “backroom negotiations” of government with the two water firms.
“Why is the President keeping the details of the alleged new water deals out of public’s sight? And more importantly, why is Duterte so compromising in his stand this time instead of fully renationalizing the water services which is, first and foremost, a public utility?” she argued.– With Edu Punay, Rhodina Villanueva