Maynilad replies to Cruz

This is in response to Neal Cruz’s column “Water firms illegally collecting fees” (Inquirer, 7/9/12) so the public may know the truth.

1. Contrary to claims that we engage in advance collections, we are actually required by the government to advance our investments so we can meet our service level obligations to our customers. We are also required to continuously invest in our water network infrastructure until 2037, ensuring water supply for our customers.

2. Our fees are based on specific, explicit service level obligations stipulated in the concession agreement, not on the completion of particular projects. If, for some reason, we are unable to implement a project and this prevents us from achieving our service obligation targets, our tariff will be adjusted accordingly in the next rate rebasing period, to reflect this shortcoming. In effect, the “gains and losses” of our company and the consumers are balanced out to ensure that the tariff structure is fair and equitable to both parties.

3. The claim that our “distribution pipes… are free” and that all we have to do is “collect the monthly bills” is a blatant lie. Since 2007, we have spent over P48 billion to expand and modernize the pipe network we inherited from the government. We also laid over 2,275 kilometers of additional pipes, and built additional pumping stations and reservoirs so we could reach unserved communities in our concession area. Also, 20 percent of our total spending went to servicing the foreign-denominated loans obtained by MWSS before privatization in 1997. We are currently paying 90 percent of its debts.

4. Implementation of the Laiban Dam and Angat Dam Irrigation Replacement projects falls under the jurisdiction of MWSS, so whether or not these are officially cancelled or discontinued is entirely up to it. Nonetheless, we are required by the government to shoulder 50 percent of the investment costs for these projects.

5. Last April 13, the MWSS Board of Trustees (BOT) issued a resolution deferring the implementation of its earlier resolution directing the MWSS Regulatory Office (RO) to issue a cease and desist order to its concessionaires, with regard to their collected tariffs for the Laiban Dam and Angat Dam Irrigation Replacement projects.

The concessionaires cannot be guilty of refusing to “obey the orders of the MWSS and the RO,” when there is no such valid order. These BOT resolutions were never transmitted or formally communicated to the concessionaires. Claims that the concessionaires “conspired and confederated to deny the said orders” are therefore untrue and baseless.

6. We do not collect sewerage fees from customers who are not connected to our sewer lines.

We in Maynilad have always conducted our business in a manner that is fair to our customers and consistent with our contractual agreement with the government. Our investments have generated employment for thousands of Filipinos. We remain committed to provide clean, reliable and affordable water solutions to our customers.

—CHERUBIM G. OCAMPO-MOJICA,

head, Corporate Communications,

Maynilad Water Services Inc.