Privately Operated Water System: The Calapan City Experience
Posted on December 12 2003 |
By Eduardo C. de Guzman
Executive Director
Mindoro Assistance for Human Advancement through Linkage (MAHAL)
Prepared for Asia/Pacific Conference on Debt and the Privatization of Power and Water Services
December 8-12, 2003
Ambassador Hotel, Bangkok
Background
Calapan City is the capital of Oriental Mindoro province in the Philippines. It is located in the north-eastern side of the Mindoro Island, some 130 kilometers south of Manila. With land area of 25,006 hectares, it has a population of 105,910 as of the year 2000. Having been converted into a city in 1998, its development is geared towards light industries, agriculture and tourism. The opening of the Strong Republic Nautical Highway has raised hopes of increasing traffic for North to South and vice versa and enliven commerce and trade with neighboring provinces.
People of Calapan city are mostly migrants from the Tagalog provinces of Batangas, Laguna, Quezon and Bulacan. Major economic activity is agriculture and related trade while major employment outside of agriculture is government and the services. Business enterprises are generally retail and wholesale outlets. There is a high rate of unemployment and underemployment and around 5 barangays have registered negative population growth in the year 2000 due to migration.
Calapan City has recently been considered to be the seat of the newly formed island provinces region of MIMAROPA.
The Calapan Water Situation
Calapan City has been served by a private operator, Nable, since 1955 by virtue of a 25-year franchise acquired from congress on June 21, 1952. Fourteen years after the system operated, it was foreclosed and operated by the Development Bank of the Philippines for one year in 1969. In this same year, congress awarded an extension to its operation for another 25 years ending in the year 2002. Repossessed in 1970, the owner transferred its ownership and operation to a group of creditors who later in 1991 registered with the Securities and Exchange Commission as the Calapan Water System and Development Corporation (CWSDC).
Burdened with an old dilapidated water system needing complete rehabilitation and very small capital available, CWSDC tried to avail of a loan from GSIS but failed to get its approval when the municipal and provincial government refused to act as guarantor.
CWSDC continued to deliver water of questionable potability. The earthquake of 1994 measuring 7.2 on the Richter Scale damaged the wells and distribution lines worsening the water quality problem.
In 1996, KASIMBAYAN, a church based cooperative concerned and irritated by the worsening water service, negotiated and forged a verbal agreement with the owners of CWSDC to buy out the company at PhP 27 M. Suddenly it was raised to PhP 49M and while negotiating for additional funds from supporters, they learned from reliable sources that CWSDC is already owned by the Ormina Corporation led by Jolly Ting. Later it was learned that the company was acquired at the same price of PhP 27M.
CWSDC commissioned a study on the geo-resistivity of the groundwater resource of the Masipit-Tawiran-Guinobatan area. It was recommended that to address the immediate and the near future water needs of CWSDC, three wells could be drilled in identified locations in the area. Another study recommended Bayanan as the site of distant future needs.
While in the Masipit area very few if there will be any are to be adversely affected at all by the groundwater extraction, the Bayanan area has several free flowing wells supporting the household water needs of the residents and providing irrigation to rice farms for their livelihood.
But CWSDC chose to drill a well in Bayanan 1, a barangay in Calapan City, and cause the loss of free flowing wells of a number of families which have been for a long time traditionally for household and farm use.
A strong peoples’ opposition was launched against the CWSDC drilling of well 9. Three district association of teachers, 4 non-government organizations, peoples organizations, tricycle drivers associations, market vendors and businessmen, housewives and employees and the 6 rural barangays led by their barangay chairperson all signed petitions opposing the well drilling in Bayanan on grounds that several households and farms will lose their water, the groundwater will be endangered to saltwater intrusion as has happened in the 5 wells of CWSDC, and surface water is the better alternative to meet its increasing demand for water and sustainability, with adverse effects on the populace and the water source easily monitored and mitigated. Submitted to the city government, the Sangguniang Panglunsod, the Department of Environment and Natural Resources, the Senate, the House of Representatives and the National Water Resource Board, a water permit was awarded by the NWRB on grounds of technicality to CWSDC water application that never had any public hearing at all.
Continuous opposition was held in form of rallies, bantay tubig, noise barrage and rosary walks to emphasize the anomalous awarding of a water permit at a time when CWSDC has not yet acquired its franchise, environmental clearance certificate, and barangay permit. The filing of a Strategic Lawsuit Against Public Participation (SLAPP suit) against 4 opposing barangay captains by CWSDC, the discrimination of the city government in infrastructure projects and basic services in health, education and social services against barangay captains and individual residents of opposing barangays, the use of policemen and the military with tanks and high powered arms, and the total news blackout all the more emboldened the residents to hang on and continue the struggle to the finish. This is despite the CWSDC finally enforcing the development and operation of the well which was inaugurated and started operating on October 28, 2003. On that day, several residents of the 6 barangays braved the military cordon that was present and expressed their anger and dismay at the blatant disregard for the people’s rights to water and their sentiments.
It was later discovered that the well that was drilled and operated is not the well referred to in the flaunted water permit granted by NWRB but a point located some 2.5 kilometers away to the south. The well that has been drilled and operated and assisted by the police, the military and the courts and supported by the Mayor, the Governor and the congressman is actually illegal.
People felt cheated, angry and disillusioned.
Three new wells are now being applied for by CWSDC and has been the subject of a formal protest. The legal expertise of the LRC-KSK have assisted the community in the filing and granting in the Court of Appeals of an intervention in a case filed by CWSDC against the 4 opposing barangay captains. Oppositors to the new wells have been ably assisted to file a protest with the National Water Resource Board.
A barangay is now considering filing of a case against the water company with the assistance of a local lawyer.
Several options are being considered to work for the protection of the water rights of household and agricultural users against private operation of the water system.
We, in Calapan City, have been experiencing the private operation of the water system for the last 50 years and for another 25 years ahead. We have suffered the inadequacies of the private operator, including financial control, mismanagement, technical deficiency, neglect and insensitivity. The dirty, foul smelling and salty water we have been experiencing in our tap that have exposed us to undetermined levels of health risks of which we had no way of verifying is a direct effect of the preoccupation of water operators to a profit orientation. It has revealed to us that the private operators profit orientation is inimical to consumer welfare especially in the absence of a clear, conscious and effective government regulation, absence of social responsibility on the part of the operator and the indifference of a disorganized and disempowered citizenry.
Giving unbridled power to water to socially irresponsible private water operators severely discriminates against the poor sectors of the community.
It is our belief that the government should bear full responsibility in running critical basic services such as water. It should help itself to attain the capability and accountability to provide clean and potable water to its constituency at an affordable rate. We cannot stop providing clean water to our citizenry because it is not profitable. Water should not be treated as a trade commodity but as a right of everyone to life.
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