Water rate hike opposed

Thousands of Metro Manila consumers are mounting a massive protest action next week to dramatize their opposition against the impending increase in water rates.

Kilusang Mayo Uno (KMU) Secretary General Elmer Labog said members of various urban organizations are taking to the streets on Wednesday to express their objection against increase in water rates.

"They are giving additional burden to poor workers who (have yet) to receive an adjustment (in) their daily take home pay," Labog said.

Upon the approval of Malacañang, Maynilad Services Inc., which supplies water to the west zone of Metro Manila, will raise water rates by P4.21 per cubic meter effective Oct. 15. Labog said Malacañang’s decision to approve Maynilad’s proposal to increase water rates was "totally uncalled for."

"Instead of easing up the people’s lives by finding more effective ways to deliver affordable and quality services to the poor, the government contributes to the incessant impoverishment of thousands of consumers," Labog noted.

If Maynilad wants to recover losses, Labog said, it should be not at the expense of the consumers.

The Freedom from Debt Coalition (FDC) also slammed Malacañang for approving Maynilad’s petition for a water rate hike.

According to FDC, Malacañang allowed Maynilad to accelerate the recovery of its losses and collect an additional P4.21 from Oct. 15, 2001 until Dec. 31, 2001. "The new water rate hike means consumers would pay for water at rates higher than what they paid before privatization," said FDC President Maitet Pascual-Diokno said, "Is this the goal of government’s privatization, to have consumers pay expensive rates while inefficiency persists? Who are the real beneficiaries of privatization – big business at the expense of consumers?"

In addition, Maynilad was granted an automatic currency exchange rate adjustment (Autocera), which it renamed as a Foreign Currency Differential Adjustment (FCDA). The FCDA, according to Pascual-Diokno, would allow Maynilad to recover future foreign exchange losses every quarter beginning January 2002.

Pascual-Diokno lambasted Finance Secretary Jose Isidro Camacho, whom she said, advised the President to grant the concessions to Maynilad. Camacho used to serve as a consultant to the Lopez-led businesses, which includes Maynilad.

Partylist Rep. Loretta Ann Rosales said the decision would enable Maynilad to automatically recover foreign exchange losses from August 1997 to December 2000. It also provides for the recovery of future losses, she said.

"This will result in a triple whammy to consumers. The first blow will come on Oct. 16 (when the P4 increase will take effect). The second blow will be on Jan. 1, 2002, and the third blow will be delivered in the second quarter of 2002 in the form of a foreign currency differential adjustment," she stressed.

She pointed out that with the Palace’s decision, Maynilad would be making quarterly adjustments to recover forex losses. The adjustments will be a huge economic burden to most Filipinos and will come at a time when they are "trying to stay afloat in the economic slump," she said.

Rosales said the water rate increase would be bad precedent as it would open the floodgates for abuse of concession agreements at the expense of the consumers.

It will not preclude other firms claiming to provide vital public services from seeking the same arrangement with the government that would allow them to automatically recover foreign exchange losses, she said. – Mayen Jaymalin, Romel Bagares, Jess Diaz and Efren Danao