MANILA: Philippine’s Maynilad Water Services, Inc. and Metropolitan Waterworks and Sewerage System (MWSS) claimed that government owes P3.44 billion as sovereign compensation for revenue losses.
The water concessionaire said the government owes it that sum because of the refusal of MWSS to honor an arbitral decision ordering rate adjustments during the period.
MWSS Regulatory Office head Joel Yu said there’s no ground for Maynilad’s claims.
“Beyond that, we’re saying that there are no loss revenues because of the design in tariff setting. Every five years, we have rate determination. In that rate determination, we compute the investment of the concessionaires and if they were able to recover it. If they didn’t, they still have time to collect that until 2037,” Yu said in a briefing held in Quezon City yesterday.
Maynilad, according to Yu, is allowed to recover its investments for the remainder of its concession agreement through succeeding rate rebasing that would be conducted in the years 2017, 2022, 2027, and 2032.
Yu also specified that Maynilad has no clear grounds for its call of a guarantee since the latter is accusing the public or the government to be interfering with the rate setting mechanism of MWSS and that the government or any other entity may have been causing the state-run agency to defer the implementation of the standard rate.
“No one is imposing on the regulatory office on how the rate to be set and to defer the rate that was determined. There’s independence in the way we determine the rates and there’s independence in our decisions,” he said.
Yu likewise implied that the Maynilad’s claim for loss revenue “due to the non-implementation of the appropriate rate they deserve” was basically brought upon by either uncontrolled circumstances or Maynilad’s changes in its business plan.
“All of those delays are due to different factors—the business changes made by Maynilad during the period of the determination, the schedule of the appeals panel, which we could not dictate, as well as the determination of rate rebasing. There are just too many factors. The computation shouldn’t have done that way,” Yu said.
Meanwhile, DOF assistance secretary Maria Teresa Habitan said they’re making computations regarding Maynilad’s call for guarantee.
“They (DOF) are examining if there’s a basis for the claim of Maynilad and if the claimed numbers are indeed correct,” Yu added.
In September 2013, the MWSS denied the petition of Maynilad as well as another major concessionaire Manila Water Services, Inc. to raise water rates in accordance with its 5-year rate rebasing scheme, which prompted both companies to seek arbitration as provided for in their concession agreement.
On December 29, 2014 the International Chamber of Commerce supported the alternative rate rebasing adjustment of Maynilad, allowing it to raise its basic water charge by P3.06 (0.069) per cubic meter, while the decision for Manila Water is yet to be revealed by MWSS.
Although there are rumors that there’s already“partial decision” on Manila Water’s arbitration, Yu didn’t confirm nor denied such information since MWSS is bound by some “confidentiality agreements.”
