JUSTICE Secretary Menardo Guevarra yesterday revealed that President Duterte has approved in principle the recommendation of a multi-agency panel removing the onerous provisions in the government’s water concession agreements with Manila Water Company, Inc. and Maynilad Water Services, Inc.
“Last night (Tuesday), the President approved in principle the broad recommendations of the review panel for the removal of onerous provisions in the water concession contracts and the inclusion of new provisions that will improve the governance mechanism, foster transparency and equitability in rate setting, and reduce the government’s contingent liability, “ Guevarra said.
According to Guevarra, the panel, which was composed of the Justice Department, Office of the Solicitor General, Office of the Government Corporate Counsel, and Department of Finance, have informed Mr. Duterte of the onerous provisions that “must go, and new provisions that must be immediately incorporated.”
“We described to him in general yung mga provisions that will have to go and new provisions that will be incorporated, that will somehow, that will make the water concession agreements more equitable, more transparent and will lessen contingent liabilities on the part of the government plus improving its governance system,” Guevarra said.
Last year, a Singapore-based arbitration panel ordered the government to pay Manila Water P7.39 billion in years’ worth of losses due to the MWSS’ reduction of water rates instead of approving their proposed rate hikes. On the other hand, Maynilad scored an order for a P3.424-billion reimbursement in 2017.
But Manila Water and Maynilad both said they would no longer collect the almost P11 billion indemnification, which the Singapore-based arbitration court ruled the government should pay them.
But the President insisted that the government would not honor the two rulings.
Duterte also threatened to sue the two concessionaires after finding that the contracts awarded to them contained some “onerous provisions.”
Previously, Guevarra said that the government stands to lose billions of pesos to Maynilad and Manila Water because of two “disadvantageous” provisions in its 22-year-old agreements with the two water concessionaires.
Guevarra said these two provisions were the reason why the government was ordered by the arbitration court in Singapore to pay the water concessionaires hefty amount.