SA’s water debt grows by R8-million every 24 hours
Delmas, on the border between Mpumalanga and Gauteng, is blessed with good rainfall, healthy soil and an abundance of coal underneath its green fields. With big coal mines, Eskom power plants, farms and agribusiness, things should be economically — if not environmentally — good.
The town falls under the Victor Khanye District Municipality, which has received qualified audits for all of this decade.
On Thursday, it missed a deadline to pay back the R87-million it owes Rand Water.
That debt has accumulated over two years.
To try to force repayment, the country’s biggest water utility has throttled water supply to the area by 60%. This means reservoirs, which need water pressure to pump water into them, are empty and entire areas of Delmas and its neighbouring towns don’t have regular water.
Rand Water cannot go further than this — South Africa’s Constitution makes access to water a right. The Water Services Act says the water supply cannot be cut by more than 60%. Municipalities know this. An official involved with planning at the national water department says this has deprived the department, water boards and utilities such as Rand Water of their “stick”.
“If you cannot cut off water then these municipalities can ignore you … then the debt becomes your problem to solve.”
The official’s frustration is one that the Mail & Guardian has encountered throughout South Africa’s water sector.
Delmas has received a lot of help from the national water and sanitation department. In 2007, it spent R750 000 to improve the “management capacity” of the town’s water system.
The national department is responsible for building dams that collect water and getting it to towns and industries. This job is often done by water boards, or utilities such as Rand Water, on behalf of the water department. Municipalities are then responsible for getting it to people’s homes.
Each household is entitled to 6 000 litres a month, for free. This is paid for by the treasury. After that, municipalities should be run like companies, with income from selling water going into building new pipelines and water treatment plants.
The qualified audits for Victor Khanye indicate that this isn’t happening. Despite rolling out water meters, it manages to collect only 74% of the money owed to it for water. And this income isn’t going into infrastructure.
The 2013 Green Drop report, which looked at the state of the town’s sewerage treatment plant, noted that “staff attitude is apathetic and unresponsive”. Laboratories, where water should be tested to see whether it’s clean enough to release into rivers, had an “unhygienic fly breeding problem”.
In a speech in the town that year, then water minister Edna Molewa said the town “has a history of water-borne diseases” (diarrhoea and typhoid). Small outbreaks happened each year after the heavy summer rains, with larger outbreaks happening at least once a decade.
In 2016, a team from the water department and the co-operative government department came to the municipality and put together a “survey of water services vulnerabilities”.
In this, the municipality said that fewer than 50% of its technical staff posts were filled. Planned and preventative maintenance was being done on just over 50% of water and sewerage systems. Most worryingly, the survey found that the municipality didn’t have a plan to manage its infrastructure.
The result was that people were not getting water. The municipal integrated development plan for 2016 recorded angry comments from people in the area, complaining of leaking sewage and water shortages.
With little maintenance, Delmas’s treatment plant releases raw sewage into the environment. (Delwyn Verasamy/M&G)
The national water department stepped in again with R54-million to refurbish Delmas’s Botleng water plant (despite it being less than a decade old) and R72-million for a new water plant. These upgrades are ongoing.
But the national water department is running out of money for these kinds of interventions because municipalities like Victor Khanye aren’t paying for water.
The treasury says that, as of December, the water department was owed R13.6-billion. Municipalities owe it R4.8-billion, and water boards owe it R4.84-billion (water boards are in turn owed this money by municipalities and other buyers of water). The rest of the debt is from individual consumers, such as mines, and other branches of government.
A similar situation is happening with unpaid electricity bills to Eskom. The water department did not respond to questions about its debt, or the effect this is having.
The co-operative governance department has extended the mandate of a task team set up to look at municipal debt to Eskom, so that it also looks at water debt. For other departments, there is little they can do until local government starts to work properly. The treasury says that, because “local government is an independent sphere of government”, it only has a “supervisory role” over municipalities. They can decide not to pay their bills, and take that money on as debt, if the council approves such a move in the annual budget.
Rand Water says it has signed a repayment agreement with Victor Khanye, “but the municipality is failing to comply with the agreement”. With water flow reduced by 60% and no other controls, the utility is left filing reports on the situation to the treasury and the water department.
The treasury says it is aware of this growing debt bomb: “Escalating debt by municipalities to suppliers of bulk water and other services is of serious concern … non-payments to the department have impacted on the sustainability of the department.”
The water department spoke about that sustainability when it addressed its parliamentary portfolio committee in November, saying water boards were struggling to survive.
The problem needed to be “addressed more aggressively” by everyone involved. But its officials also pointed to the problem that co-operative governance laws mean the water department has little power. It had taken to issuing summonses to municipalities for non-payment. Seven of these municipalities had refused, gone to court and lost their cases. But this didn’t result in payment in each case, and municipalities simply ignored the court orders.
Without this money, the water department has a serious problem. It has its own internal crisis, after successive ministers took irregular expenditure from R13-million in 2009 to R4-billion in 2017, according to the auditor general. The outstanding debt of R13.6-billion is almost the department’s annual budget.
As a result, major water projects have slowed down. In Giyani, contractors stopped working on a water supply project because they hadn’t been paid. A child then fell into a trench left open when construction was halted and died.
Long-term projects are also in danger. Work to increase the height of dams, such as the one in Tzaneen, has stopped or slowed to the pace of treacle.
The M&G has been told that this debt also threatens the next phase of the Lesotho Highlands Scheme, which requires R20-billion to build a new dam and water infrastructure. Without that dam, Gauteng’s water supply cannot keep up with its population growth, and use will exceed supply in the next decade.
And, with each day that passes, R8-million more debt is added to the problem.