By: Modesto P. Sa-onoy
OUR title notes the “secrets” of the Bacolod City Water District, but the reproduction and distribution of the documents containing the points that were raised by the opposition group among the employees are no longer hidden. Nevertheless, let us continue to give our readers a complete picture of this opposition.
One defect in the joint venture is that “Baciwa will be downgraded to a monitoring unit because Prime Water will manage the day to day operations of the water supply and septage management facilities, bill and collect tariff, connect and disconnect water services using the absorbed employees of the water district.” Indeed, the opposition rightly asks: Is this not privatization. If may not be so but the major functions of the water district will be in private hands rendering Baciwa into being a “monitor”.
The document does not say what will be monitored and what it can do when violations are incurred. What happens when Prime Water violates the agreement? Nothing is said of this, including the mechanics for arbitration. If it is the court, the case can drag on for years so that in the meantime, will Prime Water continue to operate and manage?
Aside from the functions above, Prime Water will have “sole and exclusive right to develop, rehabilitate, operate and maintain Baciwa’s water supply, among other things”. This omnibus power of Prime Water renders Baciwa inutile. Will Prime Water enter into agreements with the water supplier without Baciwa’s consent?
Although Prime Water will take over every function of Baciwa, it will not pay in full Baciwa’s indebtedness with the Development Bank of the Philippines upon the signing of the agreement. What happens when Prime Water fails to pay the amortization? Why was this important concern not addressed? How much will Prime Water pay Baciwa so it can pay its indebtedness? Nothing is said of this.
While a performance bond is provided for, the opposition claims that it is inadequate. What is adequate? What does the “rule” say? The opposition did not state but it cited the cases in other water districts that entered into the same joint venture with other water districts where the Commission on Audit found the disadvantageous performance bond. The opposition should make this clear by citing the “rules” so that the consumers will be able to really understand the inadequacies of that bond.
Now here is something that will hit the consumers right in their pockets. Prime Water “will not pay the franchise taxes” and a 12% value-added tax will be collected from the consumers. Baciwa will pay the franchise tax but it will have to pass on to the consumers the VAT. On a minimum of P200 per month water consumption, the rate rises to P220. Consider the cost to those with higher water bills.
According to the opposition, the financial loss to Baciwa will be considerable. Prime Water will pay P325 million each year for the first five years and net usufruct payments or rental of P25 million. From these,Baciwa will pay its own costs. Baciwa, however, posted on its website an annual net income of P80 million to P100 million but under the joint venture, Baciwa will earn less than P20 million. I wonder, is this within government rules? What was the basis of the rental or lease amount? Could it have been higher, considering the reported annual net income of the district? Is somebody or some people going to collect the “difference”?
There are claims that the figures in the agreement are incorrect. There is the suspicion that the amounts were manipulated so that the agreement will avoid a review by NEDA. That is possible under the present dispensation.
There are reports going around that some city officials and Baciwa employees had received money. If that claim is credible, would it not be proper to file a case before the Ombudsman? The “source” claims documented pay-off. If so, the case can prosper. But let us wait for that time when the charge is filed.
There is also a matter of compensation, retirement package, and post-employment incomes, like being with the SSS rather than GSIS. Which is better? That again is a matter of perspective and this should be left to the employees to decide.
The campaign against the joint venture has been launched. Let’s wait for the results.
