Press Release
July 24, 2008

Loren bats for efficient domestic water system

With a population now close to 89 million, the Philippines needs an efficient water system to cope with the growing demand for potable drinking water.

Only 15% of the country's 88.7 million population enjoys sufficient supply of safe and potable water since the government started its water program through the creation of the Local Water Utilities Administration (LWUA) under Presidential Decree No 198.

This means that the remaining 85 % of the population either has no enough water supplies or no water at all, a problem made worse by the seeming reluctance of local government units (LGUs) to initiate the formation of water districts in their respective areas despite the lending hand being offered by LWUA.

LWUA, which was created to furnish technical assistance and provide a specialized lending institution with peculiar expertise in the financing of local water utilities, has been able to establish and put into operation water districts in some 600 cities and towns out of the 1,500 that fall under its coverage despite a meager P2 billion capitalization which has been exhausted many years ago.

To address the problem and keep water flowing, especially in the countryside, Senator Loren Legarda has filed a bill seeking to increase the LWUA's authorized capital and its domestic and foreign borrowing authority to a significant amount.

Under Senate bill 2011, the LWUA's authorized capital stock of P2 billion as provided in Sec. 67 of P.D. 198 as amended, will be boosted to as much as P25 billion, while the domestic and foreign borrowing authority of P1 billion and $500 million, will be increased to P10 billion and $700 million, respectively.

The LWUA also has lot of undertakings to do, so much so that the Philippines' groundwater sample needs treatment after it has been found to be contaminated with coliform bacteria as discovered by a group of experts commissioned by World Bank in 2004, although the World Health Organization (WHO) said the problem involving water-borne diseases could be prevented with the provision of safe, potable and adequate water supplies and sanitation facilities.

"It is time we saved these residents from the perennial threat of epidemics and water-borne diseases as a result of contaminated drinking water," said Legarda, adding that LUWA must be strengthened to further spread the benefits of improved water systems in places in dire need of the services of efficient and professionally-run water districts. "It is necessary to address the need to infuse additional funding for expansion and improvement of the agency's financial and technical servicing," said Legarda as she explained Senate Bill No. 2011.

Legarda said she will push for the speedy enactment and approval of the bill, especially since the bill's counterpart measure in the Lower house - House Bill No. 4114 - has already been approved on 3rd reading.

Most of the LWUA's projected budget will be spent for technical assistance to prospective water district applicants and the actual construction of the project. Said water district should meet the standards and requirements of LWUA before it could be eligible to avail of financial assistance from the agency in the form of short and long term loans at concessionary rates.

In addition, LWUA's broad spectrum of technical assistance ranges from engineering studies to project construction supervision and system start-up to operation and maintenance requiring water district management and technical personnel to undergo skills training to make them ready for technology transfer.

"This law provides that the local water utilities, which should be locally-controlled and managed, must also be supported on a national level in the area of technical advisory services and financing to prevent deterioration in services," Legarda added.

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