MWSS: No grounds for Maynilad compensation

By Alvin Elchico, ABS-CBN News

Posted at Mar 13 2015 05:42 PM | Updated as of Mar 14 2015 01:42 AM

MANILA – The Metropolitan Waterworks and Sewerage System (MWSS) said the P3.44 billion compensation that Maynilad is billing government and its claims that it incurs over P200 million in monthly losses have no legal basis.

MWSS chief regulator Joel Yu claims the invocation of the government seeking compensation for the non-implementation of a tariff hike Maynilad won in an arbitral panel has no grounds since two of the conditions set are not met.

“There is no ground to call on that guarantee,” said Yu.

According to Yu, there is no proof that the government is involved in the determination and deferment of the rate hike, and second, government is not ordering MWSS to stop it.

Assuming that Maynilad can invoke the undertaking, Yu said the P3.44 billion computation is also questionable.

Even the claim that Maynilad is losing P208 million a month is not accurate, said Yu, since the concessionaire has until 2037 to recover its investments.

He said it's not fair to pass on to consumers the monetary costs of the delay.

"’Di dahil na-delay eh lugi ka na," said Yu.

While the chief regulator admits there is now a regulatory challenge or difficulty in giving in to Maynilad's rate hike, he did not categorically say that Manila Water got a negative though partial decision from the arbitral panel.

Manila Water was not allowed by the arbitral panel to pass on to consumers its corporate income tax, which is the opposite of what Maynilad got from a separate arbitral panel.

Yu said it will not be feasible that consumers of Maynilad pay for the corporate income tax of the company, and the customers of Manila Water won't.