Robredo: Review of government contracts should not defy laws

The government should not defy laws when reviewing government contracts, Vice President Leni Robredo said Thursday.

Robredo made the pitch during an open forum with the Rotary Club of Manila when she was asked of the legal basis for reviewing government contracts.

The government's decades-old concession agreements with water concessionaires Maynilad and Manila Water were recently revised to supposedly remove "onerous" provisions. Details of the new contract, however, have yet to be revealed to the public.

“Companies involved with public interest should always act to the best interest of our people, and the government should make sure that no abuses are committed as far as contracts as concerned. But then, we have lost. How the government should act should always be in accordance with laws,” Robredo, a lawyer, said.

Robredo was referring to the Permanent Court of Arbitration's office in Singapore's ordering the Philippine government to pay Manila Water P7.39 billion for the company’s losses from June 1, 2015 to November 22, 2019 or during the time Manila Water was barred from raising water rates.

The international court had earlier ordered the Philippine government to pay Maynilad Water Services Inc. P3.424 billion in revenue losses from unimplemented rate adjustments.

Both companies later dropped their pursuit of the awards after President Rodrigo Duterte threatened to arrest the people responsible for what he found were disadvantageous deals with the water companies. His spokesperson said the government would not pay.

“Laws are there to ensure that no abuses are committed by government. If the government is the one who goes beyond what the laws provide for, then that will only give way for more abuses to happen,” Robredo added.

Prior to the ruling by the Singapore court, the Philippine Supreme Court imposed more than P2 billion in fines on both water concessionaires for violating the Philippine Clean Water Act, which requires them to put up sewage systems in their service areas 10 years ago.

In addition, the state-run regulator Metropolitan Waterworks Sewerage System (MWSS) also fined the said water concessionaires for service interruptions in their respective markets in early 2019.

Aside from revising the MWSS' deal with water concessionaires, Presidential Legal Counsel Salvador Panelo has also announced that he would recommend a review of the lease agreement between state-run University of the Philippines (UP) and Ayala Land Inc (ALI) concerning the UP-Technohub property in Quezon City.

Panelo said a probe should be done to determine if what he claims was ALI’s lease payment of P20 per square meter for 25 years to UP is disadvantageous to the government.

Manila Water and ALI are both part of the Ayala Corporation conglomerate.

Robredo underscored that reviewing government contracts based on a whim rather than legal grounds is alarming.

“It is worrying how contracts are now being relegated to the background because that will affect the integrity of our contracts. Investors might shy away from putting their risk in our country,” Robredo said.

“I agree that the government should make sure that companies abide by what is required of them, but I also think that the government should not go beyond what is expected of them,” she added. — BM, GMA News