‘Tantiongco railroaded water rate hike petition’

Two top officials of the Metropolitan Waterworks and Sewerage System Regulatory Office finally broke their silence yesterday on the water rates controversy, charging chief regulator Rex Tantiongco of allegedly railroading the approval of a petition for water rates adjustment submitted by Maynilad Water Services.

Lawyers Elena Luz Alojipan, deputy for financial regulation and Virgilio Ocaya, deputy for administration and legal affairs, also accused Tantiongco of stirring up Regulatory Office employees to call for their ouster.

The two regulators sit with Tantiangco in the five-member Regulatory Office tasked with enforcing the terms of contracts with the Lopez-controlled Maynilad Water Services and the Ayala-run Manila Water Company.

The MWSS Board of Trustees is hearing a petition filed by 40 regulatory office personnel accusing the two lawyers, who have a fixed five-year term, of insubordination.

The Board of Trustees, however has no power to remove regulators, who are supposed to be independent. Under the terms of the original 1997 contracts with the two concessionaires, regulators may only be removed from office after complaints against them have been heard and decided by a body of international arbitrators.

The two lawyers said Tantiongco has been making decisions on his own without consulting the other members of the Regulatory Office. The lawyers said their office is supposed to be collegial in nature.

"Collegial bodies are supposed to act by collective action," they said in a statement, but the chief regulators has insisted on doing things his own way."

Tantiongco was also head of the Energy Regulatory Board when the ERB approved a controversial petition of the Lopez-owned Meralco for a power rate hike. Consumers brought a suit questioning the ERB’s decision, in the Supreme Court, which found that the power rate hike was arbitrary.

The case is still pending on a motion for reconsideration filed by Meralco. President Arroyo has canceled a Tantiongco-sponsored memorandum of cooperation between the MWSS and Maynilad allowing the latter to recover foreign exchange losses incurred since 1998 in 18 months instead of the 22-year recovery period stipulated in the concession agreement.

The memorandum would have allowed Maynilad to raise water rates by another P4.75 from the present rate of P6.58 per cubic meter of water. Maynilad had resorted to the memorandum of agreement after Malacañang shot down an earlier petition for an Automatic Currency Exchange Rate Adjustment. (AutoCERA). Under the 1997 concession agreement, any petition for an increase in rates must go through public hearings and a comprehensive review by the Regulatory Office.

But Alojipan said Tantiongco pushed for the approval of the AutoCERA on his own, dispensing with the mandated procedure.

Civil society groups have expressed support for the two beleaguered water rate regulators. "The problem is that the President has tossed the matter back to the nine-member Board of Trustees," said Freedom from Debt Coalition (FDC) President Ma. Teresa Diokno-Pascual.

She asked the President to revamp the MWSS Board of Trustees, whose members, according to her, have colluded with Tantiongco to pass the questioned memorandum.

"The continued stay of the Board of Trustees and the Chief Regulator undermines the credibility of the review of Maynilad’s water rate petition," said the FDC president.

Alojipan told The STAR in an interview that Tantiongco "has practically been spoon feeding Maynilad Water on how to go about the process of gaining approval for their petition."

She said Tantiongco has been making decisions without consulting them. The lawyer said that the 1997 concession agreement specifically provides that the chief regulator "will be accountable to the other members of the Regulatory Office."