Duterte to Maynilad, Manila Water: Accept new contracts or gov’t will nationalize water services

President Rodrigo Duterte has offered water firms Maynilad and Manila Water new concession agreements that do not contain provisions allegedly disadvantageous to the government and the public, Malacañang said Tuesday.

Duterte’s spokesperson Salvador Panelo said the President made the offer after the Office of the Solicitor General and the Department of Justice presented the new contracts to the Cabinet on Monday.

“The Chief Executive is giving the water concessionaires the option of accepting the new contracts without any guarantee of not being criminally prosecuted together with those who conspired to craft the very onerous contracts which are void ab initio for violating the Constitution and the laws of the land,” Panelo said at a news conference.

Should Maynilad and Manila Water refuse to accept the new agreements, Duterte will order the cancellation of their present water contracts, mandate the nationalization of water services in their respective areas of operation, and prosecute all those involved in the current arrangement, Panelo said.

“The President stressed that water is a God-given natural resource which can not be treated as a mere commercial commodity and exploited to rake in billions of pesos in profits at the expense of the Filipino people,” the Palace official said.

“As President, he can not keep a blind eye to this colossal rip off.”

In separate statements, both companies said they have yet to receive a copy of the amended contract.

"We wish to reassure the President of our continuing cooperation," Maynilad added.

Maynilad and Manila Water’s woes come after Duterte railed against the agreements which prohibit any government interference in rate-setting and provide an indemnity clause in case of such interference.

The government also questioned the extension of concession agreements until 2037, way before the existing contracts were supposed to expire in 2022.

The Permanent Court of Arbitration in Singapore has ordered the Philippine government to pay Maynilad around P3.4 billion and Manila Water P7.39 billion as compensation for losses or damages as spelled out under the liability clause.

But the companies said last December that they were no longer pursuing the awards and that they would coordinate with the government to review provisions in the agreements that the government considered disadvantageous to its interests and the consumers.

“The Filipinos have lost enormously with the unabated collections by these concessionaires despite the latter's dismal performance in supplying, delivering and distributing water,” Panelo said.

“There is a time for reckoning. That time has come.” — with Jon Viktor D. Cabuenas/MDM, GMA News