MWSS says cancelling Manila Water, Maynilad contracts now detrimental

Cancelling the concession agreements with Maynilad Water Services Inc. and Manila Water Company Inc.  at this point could be detrimental to public service, the Metropolitan Waterworks and Sewerage System (MWSS) said on Wednesday.

MWSS Administrator Emmanuel Salamat said they are now working to renegotiate the “onerous” provision under the agreements instead of cancelling the contracts.

The existing contracts with Maynilad and Manila Water will expire in 2022.

On Wednesday, MWSS said the extension of concession agreements with Maynilad and Manila Water to 2037 from 2022 has been canceled.

“We are not cancelling ho yung kontrata ngayon kasi detrimental ‘yun sa services na ipro-provide natin. Hindi ganun kasi kadali ‘yung cancellation ng contract,” he said in an interview on Dobol B sa News TV.

“But ‘yung amendment po ng contract, renegotiation of the onerous provision, ‘yun po yung ginagawa natin ngayon,” he added.

President Rodrigo Duterte is protesting the indemnity clause that holds the government liable to indemnify the companies for losses incurred as a result of state interference in water rate adjustments.

Citing the particular clause, the Permanent Court of Arbitration in Singapore has ordered the Philippine government to pay Maynilad around P3.6 billion and Manila Water P7.4 billion.

The government said it would not indemnify the concessionaires.

At a joint hearing Wednesday of the House Committees on Good Government and Public Accountability and on Public Accounts, Salamat noted: “Sa concession agreement na sinasabi na anumang changes doon sa agreement kailangan pag-usapan ng dalawang parties, ayan po ang gagawin namin.”

Duterte on Tuesday threatened to stage a government takeover of the water services in Metro Manila if the companies fail to give a satisfactory explanation how the clause was formulated.

Salamat said a government takeover is possible but that it should be done with a smooth transition plan to avoid hurting the consumers. —Joviland Rita/VDS, GMA News