A Poverty Resource Hub of Focus on the Global South Philippines

Treading Troubled Waters

Treading Troubled Waters

Jan 14, 2012

Treading Troubled Waters

by Buenaventura B. Dargantes, Mary Ann B. Manahan and Cheryl C. Batistel

Over the past decades, the Philippine government has under-invested in building water supply and distribution systems, thereby failing to fully provide safe, adequate and affordable potable water to its citizenry.  In 1990, about 87 percent of the population had basic although unreliable access to safe potable water.  By 2008, this level of access further declined to 81 percent, threatening the achievement of Philippine commitments stipulated in the 2004-2010 Medium Term Philippine Development Plan to attain 92 percent coverage by 2010, to the ASEAN to attain 87 percent coverage by 2010 and to the United Nations Millennium Development Goal to attain 87 percent coverage by 2015.

Water service in the Philippines is being delivered by various providers, mainly public and community based-organizations—water districts, local-government-operated waterworks, privately-operated water service providers, and user- and/or community-managed water systems such as cooperatives, Barangay Water and Sanitation Associations and Rural Water and Sanitation Associations.

One major limitation, however, to an accurate determination of access to water services and coverage is the absence of consolidated data, especially among systems managed by user groups and associations.  For example in 2005, the Philippine Small Towns Water Utilities Data Book recorded a total of 1,639 water utilities, while data from the World Bank (as cited by the Philippine Water Supply Roadmap in 2008) reported a total of 6280 water utilities.  By 2010, the total number of WDs reportedly increased to more than 800, with about 60 percent categorized as operational.  The Chairman of the Editorial Board of the official quarterly publication of the Philippine Association of Water Districts , however, admitted that “It is not so easy to keep track of the number of operational water districts…The safest figure is probably 500 give or take a few.  These water districts are in various stages of development.  Some are in their early start up operation.  Some have even achieved 100% coverage of their areas of responsibility.”

Even when data were available, ample care was necessary in assessing the datasets.  For example, the 2005 benchmarking database of PAWD reported that member WDs served an average of 52 percent of the population.  Doing a re-computation using the same dataset revealed that the WDs could have covered an average of 83 percent of the population in their service areas, but only 49 percent of the population in their area of jurisdiction.

The country’s water resources, on the other hand, may no longer be in an ideal condition.  There are only 5 freshwater bodies classified as class AA or “waters intended as public water supply requiring only approved disinfection to meet the Philippine National Standard for Drinking Water”; only one-third of the river systems are classified as reliable sources of drinking water supply and approximately up to 58 percent of groundwater is contaminated with coliform. Further, while water storage or internal water resources in the Cagayan reservoir, Central Luzon reservoir, Agusan reservoir, Cotabato reservoir and other smaller reservoirs could reach 50,000 sq. km, the poor implementation of the Clean Water Act, particularly the formation of Water Quality Management Area Governing Boards has led to the non-optimal utilization of Philippine freshwater resources.

As the Philippines lies along the western rim of the Pacific Ring of Fire, which is a belt of active volcanoes, major earthquake faults, and tropical cyclones, this makes the country more vulnerable to extreme weather disturbances brought about by climate changes. A 2009 study done by the Manila Observatory identifies Albay, Pampanga, Ifugao, Sorsogon, Biliran, Rizal, Northern Samar, Cavite, Masbate, and Laguna as the top 10 provinces most at risk of climate change related disasters.

In the course of conducting development roundtable discussions in Luzon, Visayas and Mindanao, the main challenges that have been identified revolved around the issues of governance as well as implementation of and addressing gaps in national and local policies.  These challenges have in turn created certain critical water situations at the local level.

Lack of coherence in policies: mining threatens watershed communities; conflicts arise among water providers and different water users

The Water Code of the Philippines is the main water law that identifies the prioritization of water use, the rights and entitlements for the extraction of the resource and the institutional set up and arrangements necessary for the management and regulation of the resource. Unfortunately, despite decades of existence, the law and its Implementing Rules and Regulations have yet to be popularized on the ground. The absence of the IRR has been creating unnecessary conflicts and confusion among different water user groups and even in downstream and upstream communities. The NWRB is the main resource regulator of the country, which issues water permits and certificates of public convenience. The effective exercise of its mandate however has been plagued by problems of resources—both in personnel and budget and because of the fragmented institutional set up of the water sector. And while such law exists, there is also a mining law which is affecting such entitlements.

Loss of access to traditional sources of water due to mining could be exemplified by the situation faced by the Bugkalots, Ifugaos, Kalanguyas and Ibalois, all indigenous peoples who have settled in Barangay Didipio, Kasibu, Nueva Vizcaya in northern Philippines. Barangay Didipio is host to the country’s first Financial and Technical Assistance Agreement granted in 1994 to Australian company Climax Arimco Mining Corporation for its copper-gold project.  This FTAA was later transferred to Australasian Philippines Mining Inc., and then to Oceana Gold Philippines, Inc.  In 2007, OGPI-affiliate North Luzon Sustainable Development Corporation (NLSDC) filed four water permit applications with the National Water Resources Board to divert 3.8 million cubic meters of freshwater annually from the Tubo Creek and Dinauyan River.  If approved, the water abstraction would affect local agriculture (this volume of water for irrigation can be used to produce some 1,538 metric tons of rice), and exacerbate the droughts brought about by the El Niño Southern Oscillation.

Moreover, OGPI operations will generate waste, which will be dumped into tailings ponds in upstream areas of the Addalam River watershed. Leachates and other discharges will pollute the Addalam River and render the Addalam River Irrigation Project inoperable. Discharges from the mine processing plants and tailings ponds can seep into the aquifer and render the water unfit for human consumption and environmental maintenance, thereby altering the day-to-day domestic use of water among the indigenous peoples.  Didipio residents have opposed the WPAs but the absence of an NWRB decision is seen by the IPs as a denial of their traditional beneficial use of water.

DRTS members from the Visayas and Mindanao also shared similar experiences with mining operations and companies encroaching on their watershed areas and affecting not only water supply or access to it but also quality. For instance, loss of access to water supply could also be exemplified by the damage to the intake structure of the Alang-alang Water System in Leyte, central Philippines.  Under the general terms and conditions of Industrial Sand and Gravel permits, no extraction, removal and/or deposition of materials is supposed to be allowed within one kilometer from reservoirs established for public water supply. The LGU, however, issued an area clearance to support the application for renewal of the ISAG permit purportedly because the proponent filed an application.

Meanwhile, the lack of knowledge about the water rights and unevenness in the application process have led to water use conflicts between different user groups and water service providers

An example is Barangay Patag, also in Leyte, which hosts the springs from which the Baybay Water District obtains its water supply. Reportedly, the barangay officials do not have information regarding the water rights held by the BWD for sources within its jurisdiction.  Neither are they aware of national government policies with direct implication for their access to safe, potable water.   Although the BWD has allowed Barangay Patag to use a spring box to supply the domestic water needs of the community, the barangay council is concerned that a change in the BWD management may result in the revocation of the usufruct due to the absence of a document formalizing the arrangement.

Moreover, the barangay councils of Patag, Gabas and Guadalupe have opposed the project of the BWD to develop surface water filtration facilities that obtain water from the river, which is used by farmers as their traditional source of irrigation.  The inability of farmers to adapt to reduced water budgets can now make previously irrigated paddies unproductive.  The protest has not been acted upon by the NWRB and negotiations with the BWD have not been reopened.

Critical water situations at the local level

Access to, availability of and safeness of water supply in rural communities are subject to high variability and unevenness.
Many advocates for improved access to and equitable allocation of water openly wonder why financially-affluent communities can have enough good quality water to flush their toilets, while economically-depressed areas usually do not have enough for basic consumption.  The usual contention is that the rich can afford it and the poor can have it if they pay for it.

Data show that if a piped system exists, residents get their water from this source—even if they have to stand in line at communal faucets.  They wash their clothes and dishes and take their shower there.   They even use the water from piped systems to flush their toilets, water their plants, or clean the pigpens and poultry houses.  In the absence of a piped system, people get their water for drinking and cooking from other sources like springs and shallow tube well pumps.  For other purposes, water from streams, rivers and open dug wells would be good enough.

These observations indicate that water use is constrained by availability and access.  Water quality is critical for drinking, cooking and personal hygiene, but for other uses, only a certain level of quality is required.

Multiple supply systems that accommodate water’s conjunctive uses, meaning using the same water for washing, cleaning toilets and gardening, etc. in an effort to conserve the resource in urban poor settlements necessitate a rethinking of water quality standards, distribution infrastructure (including house construction standards), water abstraction regimes, and price determination methodologies. Although communities and local governments have been doing multiple sourcing and conjunctive utilization of water for some time, scaling-up this system will require a corresponding capacity building of stakeholders to undertake the reforms.

Deterioration of the operations of small water systems because of forced expansion, without additional investments, programmed rehabilitation or maintenance is also affecting local water providers.

Many communities adjacent to service coverage endpoints usually demand the extension of water systems to them.  Such demand-driven expansion, when resources are adequate, can increase the asset base of WDs by more than PhP800, 000 for every one percent increase in coverage within the area of jurisdiction. But when the expansion is not adequately capitalized, it leads to a reduction in service performance. And negative feedback, manifested by customer refusal to pay, can accelerate the deterioration of the service.  In 2005, for example, a one-day delay in the payment of the water bills among WDs meant foregone revenues of around PhP2.8 million.

Some WDs and LGU-operated waterworks are vulnerable to privatization
In 1994, the NEDA Board ruled to allow local government units to implement all levels of water supply projects consistent with the decentralization and devolution process, while mandating the Local Water Utilities Administration to implement only financially viable projects.  Such official mandate created the impression that:  1) commercially-viable service areas should be turned over by government-owned and -controlled corporations (namely WDs) to private corporations; 2) LWUA should keep its hands off projects that were deemed to be not financially viable; and 3) all other projects were to be the responsibility of the LGUs.

According to a creditworthiness rating undertaken by LWUA, 14 of 430 participating water districts were identified as creditworthy, 26 as semi-creditworthy and one as pre-creditworthy.  LWUA then focused its concessional funds on the semi-creditworthy and pre-creditworthy WDs, so that these could graduate to become potential commercial investment opportunities.  The other 390 WDs had to wait until “non-traditional financing” mechanisms were put in place, pushing financially-strapped WDs into availing of more expensive loans.  Depriving the “non-creditworthy”  WDs of concessional financing led them into bankruptcy and cessation of operations to the detriment of water users.  Financing the larger WDs, who could readily avail of loans from banks, effectively reduces the amount of low-cost credit available to smaller, struggling WDs.

The capability of small water service providers to bridge the gap in water service provision has yet to be recognized.
Some unplanned/informal settlements have problems regarding access to water because WDs or LGU-operated waterworks sometimes require proof of ownership of the land and/or of the dwelling unit prior to providing a service connection.  Some water utilities would not serve housing subdivisions for reasons of economies of scale. In response, some homeowners have formed associations and negotiated bulk water supply agreements with utilities, or developed their own sources of water supply and established their own distribution systems.

This was demonstrated by three water service cooperatives in Caloocan City.  Challenged financially, they on the cost of reticulating the service area, of connecting with the water source and of initiating operations as the minimum capitalization contributed by the original members or cooperators.  The paid-up capital was used as initial payment for the bulk water connection. Once operational, other residents came to apply for connections, and the collections were used to purchase and install new pipes.   Soft loans allowed the cooperatives to adopt a strategy of incremental reticulation by purchasing pipes in bulk and laying the pipes faster.

Despite such successes, the claim of water utilities to exclusivity over their respective service areas can dampen initiatives to organize associative/cooperative water systems, which are good alternatives when central utilities fail to extend service.  These alternative water systems, especially when community investments have already been made, should be protected from incursions by water utilities, and even supported through: a) long-term financing for capital expenditures especially for poor areas and b) matching of community contributions with local government allocations for non-poor areas, but which are commercially unviable for water utilities.

Holders of water rights that operate commercial and/or private water systems threaten access to water of unregistered users of traditional sources.
In Mindoro in the City of Calapan, residents of Barangays Sta. Isabel, Bayanan I, Bayanan II, Puting Tubig, Malad and Sapul have opposed the proposal of the Calapan Water System and Development Corporation  to construct pumping stations.  These barangays have several free-flowing wells as traditional sources of water for domestic use as well as for irrigation.  Over several generations, the people have devised a mechanism for distributing water to every resident that is “perfectly potable” free of charge.

In 1952, the CWSDC was established to extract water from wells, and then feed the water into a piped system for distribution to consumers.  With increasing demand, the company extracted water in quantities greater than the recharge rate of the aquifer.  Over time, salt water intruded into the company’s wells and in the privately-owned wells of residents.  CWSDC continues to supply water to 30 percent of Calapan’s households, who reportedly get foul smelling and dirty tap water.

Faced with this situation, the residents now fear that the CWSDC’s proposed pumping stations will dry up the existing wells and that several households and farms will lose water; and that groundwater will be endangered by saltwater intrusion.  For them, surface water is a better alternative to meet increasing demand. The CWSDC, however, has responded with a strategic lawsuit against public participation against the six barangay chairpersons.  After the NWRB approved the water permit application without public hearing, the CWSDC drilled in an area that was 2.5 kilometers south of the location stipulated in the water permit.

Summary and Recommendations
The above cases highlight what the participants of roundtable discussions and sub-national consultations have raised on issues of rural water systems, failing public water systems and conflicts over water resources. To sum:

1)        The rules, policies and much less, roles of institutions, governing the water sector have not been disseminated, much less understood, by LGUs and communities.  There is an urgent need to:

    • address the institutional fragmentation, policy incoherence and information asymmetry in the water sector. The Philippine Development Plan 2011-2016 strategic focus on developing a lead agency for the water sector “to assume the functions of policy making, coordination, and resource regulation…” can be helpful in addressing these deficiencies but it will not address the immediate need for water resource users to know more and be aware of the threats to their access to water supply and to traditional beneficial uses.  The information differential has significantly contributed to the disenfranchisement of communities and LGUs to benefit from using locally-available water resources. At the same time, while the lead or apex agency intends to address the coordination problems of the 27 water agencies, there is no mention of how it will seriously tackle and address the critical water situations at the local level.  Unless these are considered, having a lead agency  will only be another layer of bureaucracy;
    • review and revise the Water Code, especially to uphold indigenous peoples’ rights and communitarian rights for resources;
    • address the lack of harmonized data in the water sector that hampers not only proper planning but as well as the identification of appropriate policy solutions and interventions—be it in regulation, financing, technical and administrative support, or related to the different water problems of the country. Harmonization requires multi-agency and multidisciplinary collaborative work, and possibly the creation of a core group of researchers and practitioners who can promote inter- and multi-disciplinary work and data sharing for water resources and services development. The ensuing research can generate detailed options for managing water resources and services.


2)        P-Noy’s administration should consider water not only in terms of infrastructure projects. Some government agencies have been examining ways of providing water but may be holding back due to what they see as potential drawbacks.  For example, water systems entail additional costs, particularly when these are not integrated in initial plans for service provision and building construction.  The needs of the water sector go beyond huge investments and financing, and technology, and addressing them will require governance models that respond to changing physical conditions as well as socio-economic realities and policy environments.  Such governance models should include:

    • mechanisms that will increase the capability of water sector managers and workers to address that the above mentioned realities because doing can spell the success or failure of efforts to advance effective and pro-poor water governance. The main goal is water for all. A policy environment recognizing water as more than a matter of infrastructure project is urgent if not necessary for this goal to be realized;
    • governments recognition of and ample support to small water service providers to enable the latter to bridge the gap in water service provision.  There should be a shift away from NEDA Board Resolution No. 5 (S. 1989) so that associative water systems can be provided performance-based grants that will allow them to source funds for water projects.  The performance criteria can include commitments to: (a) provide water to all households, especially the poor, within a service area with a specified number hours of service per day at an agreed-upon water pressure during regular service hours; (b) comply with the National Drinking Water Standards; (c) limit tariffs to five percent or less of the income of poor households; and (d) generate revenues to cover operations and maintenance expenses, while providing for depreciation, interest on loans and financing charges.
    • policies to strengthen water supply systems operated by LGUs, by user groups and by community-based organizations.  These water supply systems comprise between 30 to 60 percent of providers in the Philippines, and have been in operation longer than many of the other systems, yet their financial resilience and capacity to take on the task of water service delivery has not been adequately publicized;
    • legislation that will address unfavorable socio-economic conditions and iniquitous policies to expand service coverage and improve service delivery.

3)        The operational experiences that can be scaled-up, or applied under specific socio-economic conditions and policy environments have to be disseminated to water service providers and other stakeholders.  Moreover, these experiences should be discussed during development planning sessions being undertaken by local governments, civil society organizations and community-based water service providers to allow them to review and/or redefine their respective roles, functions and organizational processes.  Furthermore, this could encourage community organizations and NGOs to incorporate Integrated Water Resources Management approaches into the local and regional development planning processes. One key proposal here is to support and create an enabling environment for strengthening public-public partnerships  on IWRM between/among LGU-operated and community based water systems

4)        Another aspect of water governance that needs to be vigorously pursued is the management of trans-boundary water, river basins and/or water quality management areas.  As water flows across political-administrative boundaries, its management will then require new forms of inter-agency governance mechanisms.  Considering that flow of water does not conform to said boundaries, there is need for new forms of delineations requiring a new set of policies and management arrangements.  In effect, the governance of trans-boundary water can redefine sub-national affiliations and necessitate alternative arrangements to address the inadequacy of state frameworks.

In the immediate, the DENR should implement the formations of river basin bodies and water quality management boards as mandated in the Clean Water Act. This includes instituting mechanisms for conflict resolution on trans-boundary waters. The non-implementation of these measures over the years has negatively affected the whole resource sector.

5)        Finally, a serious review of the Mining Act is warranted. There should be no mining in critical watersheds that are sources of water supply for domestic use and irrigation. This was the overwhelming recommendation from the participants of the roundtables.

What the stories of the DRTS Technical Working Group on Water highlight is that the water services and resource sector have tried to keep their heads above water in the absence of adequate helpful governance mechanisms and necessary reforms in policies. The water services and resource sector have not been given enough attention, the laws and policies never fully implemented, therefore hardly creating impact on the ground. n

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