Consumers face ‘bleak christmas’

November 15, 2018
Renato Reyes Jr.
Renato Reyes Jr.

THIS year’s Christmas is about to get bleaker for consumers already plagued by runaway inflation, with “hidden increases” in the water bills of Maynilad and Manila Water adding to the skyrocketing expenses of a cash-strapped population.

According to Bagong Alyansang Makabayan (Bayan) secretary general, Renato Reyes, Jr., they are set to question the increases before the Metropolitan Waterworks and Sewerage System (MWSS).

“Hirap na hirap na nga ang mga tao ngayon sa pagtaas ng presyo ng bigas at ng pamasahe. Dagdag pa itong pahirap. (People are already having a difficult time with the increases in the prices of rice and jeepney fares. This is another additional burden.)

“When will the government step in to protect the interests of its citizens” asked Reyes, who said that the respective water rate increases of Maynilad and Manila Water approved by the MWSS in October took effect this November despite a notice of dispute filed by Maynilad which sought a heftier increase.

According to Reyes, “the increases were the result of the rate rebasing exercise which takes place every five years. Maynilad was granted a 5.73 pesos per cubic meter rate hike spread over five years while Manila Water was granted a 6.26 pesos per cubic meter rate hike also spread over 5 years.”

“However, what was not fully disclosed to consumers during public consultations is that any increase in the basic charges will also result in an increase in the environmental and sewerage charges, as these are percentages of the basic charge,” explained Reyes.

The environmental charge is 20 percent of the combined basic charge and foreign currency adjustment, applicable to all customers. On the other hand, the sewerage charge is 20 percent to 30 percent of the basic charge for commercial and industrial customers.

Any increase in the basic charge results in an automatic increase in the environmental and sewerage charges.

These “hidden increases,” said Reyes were not properly explained in the matrix released by MWSS announcing its approval of the increases.

The matrix, he stressed, only shows a comparison between the old basic rates and the new rates, but fails to explain to the consumers that environmental and sewerage charges also increased as a result.

“These issues were not even addressed during the so-called public consultations with consumers, as consultations were only focused on the rate rebasing. This is an injustice to consumers, who have a right to know where their money is going and why,” lamented Reyes.

Reyes said that “it would appear that private water concessionaires were granted an automatic increase in the environmental and sewerage charges, without the benefit of public hearings to explain why concessionaires are entitled to such adjustments.”

Environmental fees as a percentage of the basic rates have gone up from 10 percent to 20 percent over the past 20 years.

Despite this, the MWSS admits that only 14 percent of the total service areas are currently covered by the sewerage services of both Maynilad and Manila Water, the militant leader added.

It is therefore important, said Reyes, that the issue of “hidden increases” be explained by government regulators as well as investigated by Congress, which approved the Clean Water Act mandating concessionaires to provide adequate treatment facilities for waste water.

“With the continuing increases in the environmental and sewerage charges, despite the low sewerage coverage in the service area, what are consumers actually paying for? How is this fund being actually used? Where does the money go?” asked Reyes.

Also going up as a result of the increase in basic charges are the Foreign Currency Differential Adjustment, or FCDA, which is 6.11 percent of the new basic charge, as well as the VAT, which is 12 percent each for the basic charge, environmental and sewerage charges and the maintenance service charge.

“Consumers should take a closer look at their November water bills to see these changes. They will be in for a rude surprise and this will only make Christmas even more depressing for consumers already saddled with rising expenses,” Reyes added.