MWSS cancels extension of water concession deals

File: MWSS Deputy Administrator for Engineering Leonor Cleofas confirmed the cancellation during the joint hearing of the House Committees on Good Government and Public Accountability and on Public Accounts.(Pixabay Photo)

MANILA — The Metropolitan Waterworks and Sewerage System (MWSS) has revoked the resolution extending the concession agreement with Maynilad Water Services Inc. and Manila Water Co.

MWSS Deputy Administrator for Engineering Leonor Cleofas confirmed the cancellation during the joint hearing of the House Committees on Good Government and Public Accountability and on Public Accounts.

Cleofas said the decision to revoke the resolution adopted in 2008 was reached during a board meeting last December 5.

The board resolution extended the concession agreements with the water companies by another 15 years from 2022 to 2037.

“It was on the agenda that the board tackles the resolution on the approval of the extension of the concession agreement. That was brought about by the directive of the President tackled in the Cabinet meeting… they are now revoking the board resolution adopted in 2008,” Cleofas said.

The Department of Justice (DOJ) earlier said an onerous provision in the contract is the extension of these contracts to 2037 considering that the extension was granted 12 to 13 years before the original expiration of the 25-year concession agreements in 2022.

Manila Water is a subsidiary of Ayala Corporation, while businessman Manuel V. Pangilinan’s Metro Pacific Investments Corporation owns a controlling stake in Maynilad.

The two private concessionaires supply water in Metro Manila and nearby areas under agreements signed with state regulator Metropolitan Waterworks and Sewerage System (MWSS) in 1997.

President Duterte lashed out at the water concessionaires after a review conducted by the DOJ showed the water contracts were “onerous and disadvantageous to the people, relative the terms or periods, government non-interference, as well as concessionaire indemnification for losses”.

During the previous House hearing, both Manila Water and Maynilad decided not to collect the arbitral awards worth more than PHP10 billion from the government as compensation for losses and damages in the non-implementation of water rate hikes a few years ago.