The government will tap consultants from the Asian Development Bank (ADB) in the revision of the terms of the new concession agreement to be presented to Maynilad and Manila Water, Justice Secretary Menardo Guevarra said Wednesday.
In a forum in Manila, Guevarra said he was informed by Finance Secretary Carlos Dominguez III about the engagement of consultants from the ADB.
In fact, they're going to have a meeting this afternoon in MalacaAang with the Department of Finance in the Office of the President and I assume that one of the matters that we are going to take up later is the engagement of the ADB consultants for the purpose guiding the government side in the matter of revision of the economic and financial terms of the water concession agreement, Guevarra said.
He added that the revision process may be completed within the year.
The whole process may last six months. That is a conservative estimate on my part. We'll be sitting down with the water concessionaires, I know that they are waiting, Guevarra added.
Guevarra said the legal team is only waiting for the input of the DOF on economic terms such as water rate-setting mechanism, factors to be considered such as inflation rate and exchange rate, expenditures that can validly be included in the concession agreement.
He also noted that the lopsided arrangement with water concessionaires left consumers with no choice but to shoulder billions of pesos in corporate income taxes.
"I don't have a ballpark figure but it is easily in the billions (of pesos)," Guevarra said in a forum in Manila as he stressed the government will insist on amending the agreements to remove this particular onerous provision.
President Rodrigo earlier warned Manila Water and Maynilad officials of charges of economic sabotage against them for the onerous provisions of the 1997 contracts with the government.
The president made the remark after Guevarra disclosed that the justice department found the extension of these contracts to 2037 irregular, as its extension was granted 12 to 13 years before the original expiration of the 25-year concession agreements in 2022.
Source: Philippines News Agency