Institutionalization of a water user fee for watershed management

Four watersheds, namely, Angat, Ipo, Umiray and La Mesa watersheds, supply the water requirements of Metro Manila. Due to the increasing demand, water scarcity is getting to be a problem among the water users, which include the households and the industries. Hence, the concern is to maintain the health of these watersheds so that they can continuously provide water to all sectors especially during the dry season. The inadequacy of budget, however, remains to be a great challenge among the managers of these watersheds. There is a need to generate funds to finance the management activities in these watersheds. The contingent valuation study reveals that the Metro Manila households are willing to pay P29/month/household and this amount could be the basis of the water user fee, which is the most appropriate economic instrument. The preferred mechanism of payment would be through the monthly water bill collected by the water distributors. A Multisectoral Council, which will be responsible for the management of...