BACOLOD CITY – The non-disclosure of the terms of reference (TOR) on the proposed joint venture agreement between Bacolod City Water District (Baciwa) and Prime Water Corporation sparked an issue, and a discussion, on transparency during a joint committee hearing of the city council Friday at the Bacolod City Government Center.
Councilor Wilson “Jun” Gamboa Jr. said the non-disclosure of the TOR gives the public a reason to doubt the joint venture agreement entered into by Baciwa and Prime Water.
“We should weigh here which would prevail: the confidentiality of the TOR or the right of the people to information,” Gamboa said.
Details of the terms of reference were not presented during the joint hearing because of the said confidentiality.
The committees – environment and natural resources chaired by Councilor Carl Lopez, and telecommunications and public utilities chaired by Councilor Archie Baribar – also saw what looked like a face off between officials of the water firm and its workers union.
BACIWA entered a joint venture agreement with Prime Water, a Manila-based company, to manage and operate the water district for 25 years.
Lawyer Lorendo Dilag, chairman of the Baciwa board clarified that the water district will not be privatized, but only the operations will be taken over by the private company.
“There is no privatization; only a joint venture,” Dilag said.
Baciwa Employees Union, however, expressed opposition to the partnership of the district to a private company saying this will lead to privatization which will adversely affect the employees and the consumers.
Baciwa Employees Union President Leny Espina said the joint venture agreement is not the immediate solution to the problem, rather, the district should opt for a public-public partnership.
Baciwa Director Mona Dia Jardin stressed the need for the water district to look for parties that will help them provide better services to their consumers.
Jardin said they target to serve 90 percent of the total population of Bacolod at the end of the 25-year joint venture agreement.
At present, Baciwa only covers 54 percent of the city population.
Espina said it is the right of the employees to know the plans of the board for them as they will be the ones affected by the said contract.
She added that during the negotiation stage, employees were not consulted whether they are in favor of the terms agreed on by the Baciwa board and Prime Water.
The board, however, promised that the private company will absorb all their regular employees while their casual/job order employees will take a competitive examination or be trained after 6 months and will be given a chance for a regular employment. The retiring regular employees will be given substantial retirement.
12 percent VAT
Employees Union also questioned the 12 percent value added tax (VAT) which will be imposed by the private company in the 2nd year of the implementation of the joint venture agreement.
Espina said the imposition of the VAT is an indication that Baciwa will be privatized because government owned and controlled corporation do not impose the said tax.
Jardin, however, said it is necessary to impose the VAT because the operation of the water district will be managed by a private company mandated by law to impose such. On its 1st year, the VAT will be shouldered by the private company.
Espina also raised the ‘unimpressive’ track record of Prime Water for the past years.
“Based on experience, the track record of Prime Water in Manila, and in Luzon, is not good,” Espina said.
Dilag, however, said that the negotiation with Prime Water is still not final because it is yet to be challenged by another water company based in Manila.
“If in our evaluation, this joint venture is disadvantageous to the water district, then we do away with all the proposals. We can reject it (Prime Water) or all the proposals. In other words, all of these are tentative. It is not final,” said Dilag.
The proposal of Prime Water, however, will be challenged through the opening of a public bidding set on Monday, Oct. 28.