‘Consumers paying for MWSS’
questionable projects, loans’
OFFICIALS of the Metropolitan Water and Sewerage System (MWSS) did not only award themselves hefty allowances but also entered into questionable projects and loans with various corporations which are now being charged to its customers.
Bagong Henerasyon party list Rep. Bernadette Herrera-Dy said in a privilege speech that most of the projects have not been fully completed or have not even started yet "even as we, the dutiful consumers who religiously pay our obligations, shoulder the burden of the MWSS’ ineptness and mismanagement."
"The gargantuan problems of the MWSS did not come like a thief in the night for most of us. These were brought upon us mostly by allegedly overpriced projects and loan agreements entered into by the agency with various corporations in the past and most of these projects have not been fully completed on target or nor even started yet," she said.
Herrera-Dy, a member of the Liberal Party, claimed the MWSS sanctioned the rate rebasing scheme "wherein tariffs are set or adjusted to allow concessionaires to earn on their past expenditures and to provide sufficient funding for their future projects."
She demanded a "mandatory refund" of the billions of pesos advanced by consumers to the MWSS and its concessionaires, the Ayala-owned Manila Water Co. and the Maynilad Water Services Inc.
The lawmaker said the rate rebasing exercise – done every five years – is the cause of exorbitant water service charges that have increased from an average of P4.02 cubic meters in 1997 to the present P30.34 per cubic meter for MWC customers.
Maynilad, on the other hand, has hiked its charges from P7.21 per cubic meter in 1997 to P33.32.
Herrera-Dy said that one such project of the MWSS is the Pinugay Sewerage Treatment Project in Antipolo City which is allegedly overpriced by about P150 million.
The project includes the Bicti-Novaliches Aqueduct Project (BNAQ-6) which resulted in an "unnecessary" cost of P103.94 million.
The former Quezon City councilor said the projects have been front- loaded since 2007 which means that "our consumers have already initially paid for the sales of cost in the water rates, even if these projects have not been completely delivered."
Herrera-Dy also questioned the Banque Nacional de Pari loan obligation of $150 million, or P6.9 billion, which is due in 2011.
The loan was obtained on March 25, 2004 to finance and re-finance the maturing obligations of MWSS, the capital expenditures brought about by Maynilad’s non-payment of its obligations, and arbitration-related expenses for the year 2004.
"This is a seven-year fixed rate note and said amount does not even include the foreign exchange losses and interest of the loan," Herrera-Dy said.
The Laiban Dam project, which had a project cost of P45.3 billion in 2003 and targeted for completion next year, is another questionable project, Herrera-Dy said, adding that the project was also input into the MWSS’ rate rebasing project in 2008.
"In plain unequivocal terms, it means that the concessionaires are allowed under this strategy to recover their expenditures, and such costs are directly passed on to the consumers whether or not these projects are implemented," she said.
The P732 million Wawa Dam project which has been pending since 2003 was already included in the 2003 rate rebasing computation and included in the charges to consumers.
"In the same boat is the 300 MLD (million liters daily) Treated Bulk Water Supply Project in Laguna Lake which has a project cost of P100 million. This was also included in the 2003 rate rebasing project. The project has a target completion date of 2007 but it has not seen the light," said Herrera-Dy.
She also decried the collection of projected expenses for the P5.4 billion Angat Water Reliability Project that has not yet been initiated, the abovementioned 300 MLD Treated Bulk Water Supply project.
Herrera-Dy said the MWSS has also entered into a P4.1 billion earthquake contingency project which is included in the rate rebasing exercise of 2008.
She said the practice is "unacceptable" because while the concession agreement is clear that the rate for water should be at a level that will allow the concessionaires to recover its investment over the next 25 years, there was no reference to a policy that would compel consumers to pay in advance for water plans and services that have yet to be delivered. – Wendell Vigilia