Manila Water, govt ink new concession deal

JUSTICE Secretary Menardo I. Guevarra on Wednesday confirmed that the government and Manila Water Co. Inc. (Manila Water) have signed a new concession agreement.

Guevarra said the revised agreement was signed on Wednesday by the Metropolitan Waterworks and Sewerage System (MWSS), as representative of the government, and the officials of Manila Water.

“The new concession agreement with Manila Water has been signed by the parties. The panel will start discussions with Maynilad after the Holy Week,” Guevarra said.

Guevarra assured that the new contract would pave the way for “better overall service and more reasonable charges to consumers.”

The Department of Justice (DOJ) chief, however, could not say if the government would no longer pursue criminal action against the executives of water concessionaires Manila Water and Maynilad Water Services Inc. and government officials behind the “onerous” 1997 contracts.

“The new agreement is a lot more equitable than the original one, but I can’t say with any certainty if the government will still pursue any legal action arising from the old agreement, there are many factors to consider,” said Guevarra.

The provisions of the new agreement was drafted by the government panel handling the review of the new water concession agreement composed of the DOJ, Office of the President, Department of Finance, Office of the Solicitor General, Office of the Government Corporate Counsel, and Bases Conversion and Development Authority President and Chief Executive Officer (CEO) Vivencio Dizon.

The government has yet to disclose the key provisions of the agreement but Guevarra earlier said it would reflect key agreements on important financial and commercial terms that were discussed during several preliminary meetings between the panel and MWCI.

Once the agreement is signed, the panel will proceed with the negotiation for the revision of the government’s concession agreement with Maynilad.

The signing of the new agreement was in line with President Duterte’s directive for the the DOJ to review the water concession agreements after discovering onerous provisions in the existing contracts, and after the Permanent Court of Arbitration in Singapore issued a decision stating the Philippine government should pay P7.4 billion to Manila Water and P3.4 billion to Maynilad for the losses they suffered from unenforced water rate hike.

Duterte also threatened to file economic sabotage against the two water firms due to the “onerous” 1997 contracts with the government.

Guevarra earlier said among the provisions in the existing concession agreements that would have to go are the non-interference in the rate-setting mechanism of the two water firms and the MWSS and its twin provisions on indemnification arising from such government interference.