MANILA, Philippines - The Department of Finance is reviewing the basis for Maynilad Water Services' demand for P3.44 billion in sovereign compensation.
Maynilad is seeking P3.44 billion from government as sovereign compensation for revenue losses it allegedly incurred since 2013, due to the Metropolitan Waterworks and Sewerage System (MWSS) failure to implement rate adjustments as ordered by the arbitration panel.
Finance Assistant Secretary Maria Teresa S. Habitan said the DOF received Maynilad's first letter last month, and they are now validating its basis for the compensation demand.
"We're aware of the undertaking, which is provided for in Maynilad’s concession agreement, but we can't just pay them outright without any basis. Currently, we're in the process of validation and review," she said.
On Tuesday, Maynilad said the amount will continue to rise for as long as MWSS administrator Gerardo Esquivel, regulatory office head Joel Yu, and MWSS trustee Emmanuel Caparas continue to "violate their plain legal duty" to implement a final and executory ruling.
Under the sovereign undertaking, government undertook to compensate the company if its rate adjustments are delayed by MWSS.
It said its revenues and service are being affected each day that it unable to collect the proper rates.
"In the end, it threatens our viability as well as our and MWSS’s ability to provide the services the consumers need and deserve," Maynilad said.
MWSS earlier said it will not take further actions on water rate adjustments until the arbitration process for both Maynilad and Manila Water have been completed.
It also said that allowing Maynilad to increase its rates will cause a dilemma.