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'NEW MAYNILAD' TO INCREASE RATES BY 32% IN JUNE
by Arnold Padilla
Tuesday, Mar. 23, 2004 at 1:38 PM
research@ibon.org 713-2737
Since taking over the metropolitan West Zone, Maynilad has already
increased its rates by 226 percent. As a result of the government
bailout, the water firm will further hike its rates by 32% in June
this year.
Since taking over the metropolitan West Zone, Maynilad has already
increased its rates by 226 percent. As a result of the government
bailout, the water firm will further hike its rates by 32% in June
this year.
The rate increase will allow Maynilad to pay for its obligations. In
other words, consumers will shoulder the "rehabilitation'' of the
Lopez-Suez consortium, contrary to claims made by Justice
Undersecretary Teehankee that the government and consumers will gain
from the new deal.
Moreover, it is not true that the government "even earned from the
deal." In reality, the government will shoulder Maynilad's financial
obligations once it takes over its operations. Worse, the government
waived its right to collect from Maynilad P8 billion in concession
fees. How could the government have earned from that?
Thus, the Malacañang bailout, which serves President Arroyo's
presidential bid, is adding insult to injury. It does not only worsen
the financial problems of government. It also means further injustice
to the 5.2 million Maynilad customers.
For the consumers, the bailout will mean lower service targets for
Maynilad, which has consistently failed to fulfill its original
performance targets stipulated in its contract with government.
Maynilad has failed to supply water to 1.5 million people in its
service area. It has also failed to make its water supply available
for 24 hours, a commitment it should have met four years ago.
Water losses due to leaks and illegal connections are even worse
under Maynilad. Before the privatization of the Metropolitan
Waterworks and Sewerage System (MWSS), the rate of water losses was
61 percent. Under Maynilad, it has jumped to 69 percent.
Government claims that the new deal with Maynilad is the most
favorable for government and consumers. But for the people, any deal
that would further burden consumers of high rates and poor service--
and that would not compel Maynilad to return the P6.4 billion it
illegally collected from its costumers, as well as the P8 billion in
unpaid concession fees--is unacceptable.
The most favorable deal is not a bailout but a complete government
takeover of Maynilad. #
The Water for the People Network is a broad national network composed
of the Bagong Alyansang Makabayan, IBON Foundation, Confederation for
the Advancement and Recognition of Government Employees (COURAGE),
Kilusang Magbubukid ng Pilipinas (KMP), Cordillera People's Alliance
(CPA), Center for Environmental Concerns (CEC), Kalikasan People's
Network, Gabriela, Kalipunan ng Damayang Mahihirap (Kadamay) and
other people's organizations, advocacy groups, non-government
organizations, and community-based associations. The network
campaigns for people's right to access water and water services.
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