"The pending increase in water rates is due to the scheduled rate rebasing of the two concessionaires, which is done every five years throughout their 40-year contract. The rate rebasing process, which will be completed by end-June, will adjust the basic charges of the concessionaires. Maynilad has petitioned for an increase in its basic charge by Php8.58 per cubic meter (cu.m) (revised from their original petition of P10.30), while Manila Water is seeking an increase of Php5.80/cu.m. As it is, the proposed hikes are already huge– 30% increase for Manila Water’s basic charge and 21% for Maynilad. However, the actual increase will even be bigger if the other tariffs that compose water rates are added to the basic charge, such as the foreign currency differential adjustment (FCDA), environmental charge and value-added tax (VAT). All these considered, the increase in the water rate (all-in tariff) of Manila Water will be Php7.81/cu.m. and Php13.71/cu.m. for Maynilad. This means that an ordinary household consuming 30 cubic meters every month will see its water bill increase up to Php234 for Manila Water and Php342 for Maynilad. According to the WPN, the two concessionaires have effectively turned water service into a profitable business. Consumers shoulder the burden of onerous charges and taxes, while the water concessionaires are assured that losses are recovered through automatic tariff adjustments and recovery mechanisms in their contracts. Since water service in Metro Manila was privatized in 2007, the all-in tariff of Manila Water has increased by Php34/cu.m. or by 850%, while Maynilad has increased by Ph39/cu.m. or by 547 percent. According to WPN, the petition to increase water rates is unjustified, especially since it comes amid questionable charges that the two water firms added in the last rate rebasing, including the cost of unimplemented projects. However despite the huge increase in water rates, Metro Manila consumers have yet to see a marked improvement in their water service. Reports by the two firms on their performance and coverage share are questionable, especially since many of the areas in Metro Manila have no individual connections with 24/7 water supply..." waterforthepeople.wordpress/2013/06/07/water-bill-to-rise-by-as-much-as-php342-per-month-if-rate-hike-approved/
Posted on: Fri, 05 Jul 2013 16:07:40 +0000
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