It seems Senator Franklin Drilon’s fingerprints have been everywhere recently. The “sleeping” Senator has been a vocal mainstay in recent headlines thanks to his harsh critique of the Philippines’ hosting of the 2019 SEA Games. While it may seem strange to some that Drilon is now questioning the budget which he himself was part of the approval process for, things have become clearer now that President Duterte has brought back to light Drilon’s involvement with the iffy Maynilad and Manila Water concession schemes that have been costing Filipino people for decades. Thankfully, Drilon wasn’t able to fully cover his tracks, or his ass with his diversion tactics and now it’s head his head that’s rightfully on trial.
On Tuesday, President Duterte recounted a side remark Senator Drilon made to him which advised against government action to address the rising problems with the current water concessionaires of the capital. According to the President, Drilon advised him against “tinkering” with the contracts “because we [the Philippine government] will end up paying so many billions of pesos.”
Earlier this year, the Permanent Court of Arbitration in Singapore ordered the Philippine government to pay the Salim-Consunji group’s Maynilad Water Services Inc. and the Ayala group’s Manila Water Co. a staggering P3.6 B and P7.4 B in losses and damages, respectively. These penalties were based on the government’s supposed interference in rate-setting for the firm. They were enforced thanks to clauses in their “onerous” 1997 concession agreements, which were crafted by ACCRALAW, for which Senator Drilon is a senior counsel.
So the government is already paying out these companies billions of pesos. Worse, until the review of these contracts, we will continue to be bound to the clauses which the Department of Justice has described as “disadvantageous to the government and the consuming public.”
“Most notable were the prohibition against government interference in rate-setting and the provision on indemnity for possible losses in the event of such government interference,” said DOJ Secretary Menardo Guevarra.
“The DOJ also found the extension of these contracts to 2037 irregular, considering that the extension was granted 12 to 13 years before the original expiration of the 25-year concession agreements in 2022,” Guevarra said.
“Senator Drilon, are you one of those who crafted that? I’m asking you,” The President said in the same speech.
“I said I’m ready to get out. I’m not threatening you, but if I go down, I will drag you with me,” President Duterte added.
In response to the hefty fines we had to pay out to these water companies, President Duterte ordered the review of all government contracts. He has also threatened to charge water concessionaires of economic sabotage over their obviously unequal agreements.
Drilon, in response, warned that all “existing and binding contracts cannot simply be classified as onerous and canceled.” It is unclear as of this point how much more involved Drilon was in these shady water deals, beyond the contracts.
For their part, water concessionaires are warning that consumers may now be facing a staggering P26.70 per cubic meter price increase in water rates, thanks to a Supreme Court decision from August this year which directed them to pay fines amounting to almost P2 B for violating RA 9275 or the Philippine Clean Water Act.