Where's computation for water rate hike? Solon asks MWSS

The Metropolitan Waterworks and Sewerage System (MWSS) ought to provide consumers a detailed computation on how it came up with the amounts of water rate increases for its two private concessionaires.

(Noah/ Unsplash)

Thus, said House Deputy Minority Leader ang Bagong Henerasyon Party-List Rep. Bernadette Herrera even as it was reported that Manila Water and Maynilad will be charging their customers an additional P20.37 and P13.69, respectively, throughout 2023 to 2027.

In a recent statement, the MWSS-Regulatory Office announced that it had approved the rate rebasing adjustments for both Manila Water Company Inc. and Maynilad Water Services Inc. which will be implemented throughout the five-year period.

But Herrera said the public ought to know whether or not these rate adjustments are justified.

“The MWSS-Regulatory Office is under strict obligation at this time to show computations in accordance to the parameters of return on rate base, projected additional capex (capital expenditures) invested already in the water supply distribution system, updated percentages of capex invested on sewerage and sanitation facilities by the concessionaires, and computation of the effect of inflation,” she pointed out.

She explained that the effect of foreign currency differentials should not be included in the new rates “if these are already separately adjusted under a different rate uptick mechanism".

Herrera said she wants to know if MWSS observed two important measures that were provided for under the law, in setting the new rates.

First, Herrera said the MWSS must be reminded that Maynilad and Manila Water are now considered public utilities, hence “the 12 percent return on rate base must be strictly observed and must be based on actual capex already installed in the entire system".

“It is no longer what was practiced before where there were abuses in the application of rate rebasing methodologies and where projects intended to be done were already considered in the water rate settings by the unscrupulous MWSS regulators,” she added.

Secondl Herrera said the income taxes of the concessionaires should no longer be part of the rate setting.

“It can be recalled that in the past MWSS rate rebasing, the income taxes of Maynilad and Manila Water were part of our monthly billings of water consumption per cubic meter,” Herrera said.

The ranking solon reckoned that regulators must also “proportionally deduct” from the new rates the cost of previous projects of the water concessionaires that were not implemented but already collected from water consumers as reflected in their previous monthly billings.

She said these projects include improvements in Wawa Dam, Angat Dam, Antipolo sewage treatment plant, and “other water resource development programs that were never implemented up to this time.”

“The non-completion of these projects resulted in water supply shortages that we are currently experiencing despite the rains and flood water abundance,” Herrera stressed.