Gilbert S.

Vasquez
2020 – 0002
NREL Sec. 65, Sat 1:00 – 4:00 pm

Reaction Paper on LWUA/Local Water Districts

Being born in Metro Manila and fortunate to have the big water concessionaires to provide
potable water to our homes, I always ask myself, how about those outside, in the provinces. Is there a
Maynilad or Manila Water in their locality. I only learned that outside of Metro Manila, local service
providers take care of distributing potable water. The report, as well as my reading of the prescribed book
on the subject is an eye opener. I was surprised to learn that under P.D. 198, the Local Water Utilities
Administration (LWUA) was established as a government corporation to function primarily as a specialized
lending institution for the promotion, development, and financing of local water utilities. In fact, under
the same law, LWUA has broad powers and duties from prescribing the minimum standards and
regulations for local water utilities on several areas, even furnish technical assistance and personnel
training programs, monitor, and evaluate local water standards, and if economically-warranted, effect
systems integration, join investment and operations, district annexation and de-annexation. Reading this
from the text of the law, I would say that LWUA’s scope and powers are so expansive and broad. Aside
from the powers and duties I just cite, LWUA may review rates or charges fixed by water districts if it
complies with the provisions of P.D. 198. I also learned that water districts are government-owned or
controlled corporations with original charters which may be created by the local legislative bodies through
a resolution.
In my view, it is very critical that water districts are under the control and supervision by the
government through the passage of a resolution by the different local legislative bodies. In fact, in the
whereas clauses, it is stated that local water utilities should be locally-controlled and managed, as well as
have support on the national level in the area of technical advisory services and financing. I think, there
is sufficient balance of leaving the control and management of local water districts to the locality and the
national government, through the LWUA just providing broad technical and advisory support. Having this
mandate by a local law, water districts have all the resources of the government behind it. Aside from
this and most importantly, being a quasi-public corporation, I would assume that it would always act in
the best interest of the public not only in terms of ensuring a regular supply of clean and potable drinking
water or for commercial or industrial purposes but also the availability of such resource at a reasonable
fee. With the set-up prescribed under the law, local water districts are more attuned to the needs of the
locality it is servicing and may readily adjust if needed.
The provisions under the law on the creation of local water districts vis-à-vis the existence of the
LWUA are sufficient to attain most of its objectives, focusing on regulation and organization of the water
districts. However, I have a bit of a concern on the level of control which LWUA exercises over water
districts. Like other government regulatory bodies, LWUA may review the rate increases of water districts
after the conduct of a public hearing. Although I agree that there should be a separate body who reviews
the rate increases of water districts, I am just wary of the timeline on the resolution of such concern. Since
local water districts are public corporations which basically are being run like a private corporation for
profit, the period review of LWUA must be still catch up to the needs of the local water districts, say for
additional funds, as justification for the rate increase.