WHEREAS, drinking water is a basic requirement to sustain life;

WHEREAS, only about 40 percent of the population of the Philippines is presently served with public water supply systems;

WHEREAS, it is a primary concern of the Government in promoting the welfare of the people to hasten the availability of water supply services in the whole country, with special attention to the rural areas;

WHEREAS, the approved Philippine Development Plan for 1978-1987, therefore, aims to increase the public water supply coverage to about 85 percent of the total Philippine population within ten years;

WHEREAS, there is a need to restructure the water supply sector so that gaps and overlaps in responsibility will be eliminated; and

WHEREAS, it is necessary to establish1 certain basic policies to attain these objectives in the most efficient manner;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the constitution, do hereby order the implementation of the following basic policies for the water supply sector;

(1)	The attainment of complete coverage of water supply services for the whole country is a declared policy of the State shall be effected primarily through:
	(a)	The rationalization of the organizational structure for the water supply sector;
	(b)	The formation of water districts, associations, cooperatives or corporations for the construction, operation and maintenance of water supply systems in preference to systems directly operated and managed by local governments; and
	(c)	The encouragement of self-help and self-reliant water supply projacts.
(2)	Agencies involved in water supply shall strive to attain financial independence, thereby minimizing Government subsidy, by increasing their own internal revenue generation capabilities and by providing services within the cost repayment capabilities of the beneficiaries.
(3)	The levels of water supply service to be developed shall vary according to technical, economic, organizational and financial considerations,, These levels of service are as follows:
		Level I	—	Point sources (such as rain collectors, wells and springs); generally for rural areas where houses are scattered too thinly to justify a distribution system.
		Level II	—	Communal faucet systems; generally for rural areas where houses are clustered densely enough to justify a piped distribution system with a faucet provided for a number of households.
		Level III	—	Individual house connections; generally for urban areas
(4)	The rationalization of the water supply sector structure shall be pursued in accordance with the following strategies:
	(a)	The Metropolitan Waterworks and Sewerage System shall concentrate its operations in Metropolitan Manila and other contiguous areas that may later be included in its service coverage.
	(b)	The Local Water Utilities Administration shall promote water districts in cities and municipalities with a population of at least 20,000 each. It will support these water districts through institutional, technical and financial assistance.
	(c)	The Bureau of Public Works shall be mainly responsible for the construction of wells and development of springs in rural areas.
	(d)	The Department of Local Governments and Community Development shall be responsible for the formation of water associations and cooperatives that will operate and maintain water supply systems for communities in the provinces covered by the Provincial Development Assistance Program (PDAP). It shall provide institutional, technical and financial support to these associations and cooperatives.
	(e)	Task Force on Rural Water Supply under the National Water Resources Council shall, untill such time that a permanent institution of the Government to handle the rural water supply sector is evolved, be responsible for the formation of water associations and cooperatives that will construct, operate, and maintain water supply systems in the rural areas of non-PDAP provinces. This Task Force shall provide technical, institutional and financial assistance to these associations and cooperatives. It shall also sake studies and recommendations on the appropriate institution that will eventually be responsible for the rural water supply sector on a permanent basis. The Task Force is hereby authorized to call upon any agency of the Government for assistance in accomplishing its tasks.
(5)	The National Water Resources Council shall be responsible for coordinating the implementation of the above policies. It shall submit to the President of the Philippines, periodic reports on the status of the entire water supply sector and the performance of each of the above agencies in relation to the overall policy framework for water supply.

Done in the City of Manila, this 30th day of March, in the year of Our Lord, nineteen hundred and seventy-eight.