Sat. Jul 31st, 2021

The revised agreement with water concessionaire Manila Water Company, Inc. is “advantageous” to the government and consumers, Malacañang said Monday.

(photo courtesy:

Presidential Spokesperson Harry Roque made this remark after Justice Secretary Menardo Guevarra announced on March 31 that the government’s revised agreement with Manila Water has been signed.

“The Revised Concession Agreement will provide better water service to Metro Manila and is very advantageous to the national government and consumer,” he said in Filipino during a Palace press briefing.

Roque pointed out that the new concession deal is proof that Duterte has the Filipino people’s best interests at heart.

Roque noted that the agreement is modeled after the New Clark City joint venture agreement of the Bases Conversion and Development Authority (BCDA) as advised by the Asian Development Bank (ADB).

Among the salient points of the new concession deal that benefits the government is the removal of government non-interference clauses which means that the government will no longer be liable when fulfilling its regulatory functions to protect the consumer.

The new concession deal also recognizes that Manila Water as a public utility, which makes it more accountable to the government and the public.

It also removes the addition of provisions that unduly compromise medium- and long-term government liabilities (contingent liabilities), such as the following:

– Removal of the national government’s performance undertaking for future debt and requires that all debt;

– All debt and expenditures of the concessionaire must be reviewed and approved by the regulatory office;

– All fully recovered assets are immediately transferred to the government to ensure there is no double payment at the end of the contract; and

– Material Government Adverse Action (MAGA) is limited only to actions of the Executive so that the National Government is not liable for things outside of its control.

As for the consumer, the new concession agreement states that corporate income tax cannot be charged to the consumer, unlike the previous concession agreement.

It also indicates that there is a tariff freeze until Dec. 31, 2022.

The tariff adjustment for inflation will only be two-thirds of the consumer price index, unlike the previous contract which had a 100-percent inflationary impact.The new concession deal also removes the Foreign Currency Differential Adjustment (FCDA), which will result in much lower tariff increases and protect the consumer from possible tariff spikes because of foreign exchange movements. SOVEREIGNPH

One thought on “Palace says revised water contract with Manila Water favors consumers”
  1. Thank you to our President Rodrigo Roa Duterte, consumers are now in good hands.

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