PURPOSE OF BOOKLET: To present a broad overview of the water sector in South Africa. This document has been produced by the Department of Water Affairs (DWA) Proudly Prepared by: DWA Directorate: Water Services Planning & Information Version 1.5 - Printed - 27 May 2013 While the Department takes all due precaution to ensure correctness of the information, it takes no responsibility for the misinterpretation thereof. ii
ACKNOWLEDGEMENT This document was compiled from inputs from various Directorates within the Department of Water Affairs as well as a number of sector partners. FOREWORD The Department of Water Affairs (DWA) is the leader and regulator of the water sector in South Africa and has the mandated responsibility to ensure that all people have access to sustainable water services and resources. South Africa is a water scarce country and it is essential that all available water is used effectively, efficiently and sustainably in order to reduce poverty, improve human health and promote economic development. Both surface water and groundwater resources are managed to ensure a balance between usage and availability in order to meet the country s present and future water demands. iii
LIST OF ACRONYMS DWA CAPEX CMA CSIR DOHS DCOG DM DoRA DWQ FBS FBW GDP HH HSRC IAM IDP IMESA IMFO LM MAR MDG MFMA MIG MuSSA Department of Water Affairs Capital Expenditure Catchment Management Agency Council for Scientific and Industrial Research Department of Human Settlements Department of Cooperative Governance District Municipality Division of Revenue Act Drinking Water Quality Free Basic Sanitation Free Basic Water Gross Domestic Product Household Human Sciences Research Council Infrastructure Asset Management Integrated Development Plan Institute of Municipal Engineering of South Africa Institute of Municipal Financial Officers Local Municipality Mean Annual Runoff Millennium Development Goal Municipal Finance Management Act Municipal Infrastructure Grant Municipal Strategic Self-Assessment iv
OPEX Operating Expenditure PPI Producer Price Index RWU Regional Water Utility SAAWU South African Association of Water Users SALGA South African Local Government Association SANS South African National Standards Stats SA Statistics South Africa TCTA Trans Caledon Tunnel Authority URP Urban Renewal Programme WARMS Water Authorisation and Registration Management System WCDM Water Conservation Demand Management WISA Water Institute of South Africa WMA Water Management Area WRC Water Research Commission WS Water Services WSA Water Services Authority WSDP Water Services Development Plan WSP Water Services Provider WTW Water Treatment Works WWTW Wastewater Treatment Works NWRS National Water Resource Strategy WUA Water user association 10 6 m 3 /a Million cubic metres per annum v
1. Setting the scene 01 1.1 Demography 01 1.2 Key financial indicators 01 1.3 Water governance and management 01 1.4 Institutional arrangements and partnerships 03 1.4.1 Sector leadership and regulation 04 2. Water Resources 05 2.1 Rainfall and water availability 05 2.2 Water resource profile 05 2.3 Water balance 07 2.4 Water management areas 10 2.5 Water transfers 12 3. Water Services 13 3.1 Water services business lifecycle 13 3.2 Role-players 14 3.3 Customer profile 16 3.3.1 Demographics 16 3.3.2 Urbanization and average population growth rates 16 3.4 Water services authorities 17 3.5 Water boards 19 3.6 Basic level of domestic water supply 22 3.7 Medium and higher levels of domestic water supply 22 vi
3.8 Interim services levels 22 3.9 Basic household sanitation 23 3.10 Higher level of sanitation 23 3.11 Water services delivery targets 24 3.11.1 Basic water and sanitation targets 24 3.11.2 Millennium Development Goals (MDGs) 24 3.12 Water services development plans 25 3.13 Basic water supply progress 26 3.14 Basic sanitation progress 28 3.15 Basic water services delivery needs 30 3.16 Free basic water 33 4. Key Water Services Performance Areas 33 4.1 Municipal strategic self-assessment 33 4.2 Non-revenue water 37 4.3 Drinking water quality 42 4.3.1 Water treatment works 42 4.3.2 Drinking water quality compliance 43 4.3.3 Blue drop certification 44 4.4 Wastewater treatment 45 4.4.1 Wastewater treatment works 45 4.4.2 Wastewater quality compliance 46 4.4.3 Green drop certification 47 4.4.4 Waterborne diseases 48 vii
4.5 Scheme functionality 48 4.6 Asset management 50 5. Water Business Management 52 5.1 Sector investment 52 5.1.1 Sector investment framework 52 5.1.2 Municipal grant funding 55 5.1.3 Regional bulk infrastructure grant 58 5.1.4 Municipal Water Infrastructure Grant (MWIG) 59 5.1.5 Human Settlements Development Grant (HSDG) 60 5.1.6 Rural Households Infrastructure Grant (RHIG) 60 5.1.7 Operating revenue 61 5.1.8 Operating expenditure 62 5.1.9 Tariffs 63 6. Achievements 67 7. Challenges to Sustainable Service Delivery 68 7.1 Municipal capacity 70 8. Contact Information 71 viii
1. SETTING THE SCENE 1.1 DEMOGRAPHY South Africa s population (2011), according to the StatsSA Census 2011, was 51.77 million people. The country is made up of 9 Provinces; Gauteng is the most densely populated (12.3 million people) and the Northern Cape the least (with just over a million people). 1.2 KEY FINANCIAL INDICATORS South Africa s current annual Gross Domestic Product (GDP) is R3672 billion, which translates to 0.66% of the world economy. Historically, from 1993 until 2012, South Africa s average quarterly GDP Growth was 3.3%, reaching an historical high of 7.60% in December of 1994 and a record low of -5.90% in March of 2009. The Producer Price Index (PPI) for domestic output showed an annual rate of change of +5.1% from August 2011 to August 2012. Approximately 25% of the workforce is unemployed. 1.3 WATER GOVERNANCE & MANAGEMENT The Department of Water Affairs (DWA) leads and regulates the water sector in South Africa, develops policy and strategy, and provides support to the sector. DWA is governed by two Acts, the National Water Act (1998) and the Water Services Act (1997), and together with national strategic objectives, governance and regulatory frameworks, provides an enabling environment for effective water use and management. 1
Orientation Map Limpopo Polokwane (Pietersburg) Mafikeng (Mmabatho) North West Mbombela Tshwane (Nelspruit) (Pretoria) Gauteng Mpumalanga Johannesburg Northern Cape Sol Plaatjie (Kimberley) Free State Mangaung (Bloemfontein) Kwa Zulu Natal Pietermaritzburg Ethekwini (Durban) Eastern Cape Western Cape Nelson Mandela Bay (Port Elizabeth) Cape Town Buffalo City (East London) 2
1.4 INSTITUTIONAL ARRANGEMENTS & PARTNERSHIPS DWA operates at national, provincial and local levels across all elements of the water cycle (i.e. from water resource management, water abstraction, water processing and distribution of potable water, wastewater collection, to treatment and discharge). DWA does not execute all of these functions; some are either constitutionally assigned to appropriate sector partners. DWA owns most of the large dams and related water resource infrastructure and undertakes the necessary planning and implementation of future water resource development projects. On the other hand regional bulk water distribution is managed by Water Boards, municipalities and DWA. Waterboards and some of the larger metropolitan municipalities (Metros), also purify water to potable standards. Provisioning of Water Services (water supply and sanitation) is the constitutional responsibility of local government (Metro, Local or District Municipalities) who act as the Water Services Authorities (WSAs) and often also Water Service Providers (WSPs) for all communities in their areas of jurisdiction. Some WSAs, where wastewater management is a regional challenge, have contracted out this function to bulk water services providers, however, the responsibility still rests with them to ensure an effective service. A wide range of water resources management functions within a catchment area may be delegated to Catchment Management Agencies, which are in the process of being established, while Irrigation Boards that are in the process of being transformed into Water User Associations, operate at a local level, managing water-related activities. River health and related catchment management functions are shared between the DWA and the Department of Environmental Affairs. The Water Research Commission (WRC) undertakes water related research activities for DWA. DWA maintains close partnerships with the South African Local Government Association (SALGA), the Development Bank of Southern Africa (DBSA), Catchment Management Agencies (CMAs), Water Use Authorities (WUAs), the Trans Caledon Tunnel Authority (TCTA), the Water Institute of Southern Africa (WISA), universities and technikons. 3
1.4.1 Sector Leadership and Regulation DWA oversees and regulates the water business through appropriate policies and regulations which are implemented through its 9 provincial offices and 4 water management clusters. DWA also monitors the performance of the sector and regulates the drinking water quality and effluent quality against industry standards and recommends changes to the business environment within which the various role players have to perform. Currently DWA is revising the National Water Resource Strategy and the Strategic Framework for Water Services, and providing inputs into the National Framework for Water for Growth and Development. National water strategies are supported by regional and local plans, notably catchment management plans, provincial growth and development plans, bulk water supplier business plans, water master plans and water services development plans. 4
2. WATER RESOURCES 2.1 RAINFALL AND WATER AVAILABILITY South Africa is ranked as the 30th driest country in the world. The country is semi-arid with rainfall varying from less than 100 mm per annum in the West to over 1500 mm per annum in the East. Average rainfall is 450 mm per annum which is well below the world average of 860 mm per annum. Climate change predictions are for a drier Western half of the country and for far more variability, with more extreme events, to the East. 2.2 WATER RESOURCE PROFILE South Africa is a water scarce country with extreme climate and rainfall fluctuations. South Africa s water usage typically comprises of 77% surface water, 9% groundwater, and 14% re-use of return flows. Management of South Africa s water resources involves catchment management, river systems, water storage, water abstraction and return-flow management. Integrated management techniques are required to ensure that water is both protected and utilized to its full potential. 5
DWA manages the country s water resources in order: To ensure reliable and equitable supply of water for sustainable economic and social development including poverty eradication. To ensure protection of the resource. To ensure and support the development of effective water management institutions. To align staff and stakeholders towards a common vision of integrated water resource management. In order to manage the variability of surface water runoff and to supply water to locations of economic activity, South Africa has built comprehensive water resources infrastructure that includes 794 large dams (i.e. dams with a wall height 15m, or a wall height between 5 and 15m and a storage capacity exceeding 3 million m 3 ). Their combined storage capacity is in the order of 31 billion m 3. More than two thirds of the country s MAR is stored in these dams. The Komati Water System Augmentation project was recently completed and the Mooi-uMgeni Transfer Scheme s Spring Grove Dam (KZN) is nearing completion. A new dam, the De Hoop Dam, on the Steelpoort River in the Limpopo Province is under construction and due for completion in 2013. The Mokolo Crocodile River Water Augmentation Project s pipeline is also under construction in the Limpopo province. The Lesotho Highlands Phase 2 has been given the go-ahead and will start with construction of the Polihali Dam and tunnel. The following projects are being planned to meet future water requirements: construction of the Mzimvubu Dam (E. Cape) and the Nwamithwa Dam (Great Letaba System Mpumalanga). In addition the raising of the Hazelmere Dam (KZN) and the Clanwilliam Dam (W. Cape) are being planned. 6
2.3 WATER BALANCE South Africa s mean annual runoff (MAR) is about 49 billion m 3 /annum, however only some 10.24 billion m 3 /annum of this is available at high assurance. An estimated 9.5 billion m 3 /annum is required to satisfy the total ecological reserve requirement (the Reserve). Rivers, lakes, wetlands and estuaries are some of the key ecosystems requiring protection. The Human Reserve is required to satisfy basic human needs by securing a basic water supply, for people who are, or who will, in the reasonably near future, be: (i) relying upon; (ii)taking water from; or (iii) being supplied from, the relevant water resource. The current basic domestic water use component (or 25 litres/ person/ day) translates to 472 million m 3 /annum or 11% of the total domestic water use. Many rural settlements still have insufficient water resources to meet their basic water demands and further groundwater and surface water resource developments are necessary. Ground water usage is in the order of 2 billion m 3 /annum, (although this may be an underestimation). Recent estimates indicate that the potential reliable yield could be 5 billion m 3 /annum. It is estimated that return flows from irrigation, urban domestic uses and bulk industrial and mining effluents could offer re-use opportunities of up to 1.9 billion m 3 /annum. Current total reliable yield, (at 98% assurance of supply), is close to 15 billion m 3 /annum. According to DWA s Water Authorization and Registration Management System (WARMS) database, the total registered water usage, (not to be confused with actual use), has already reached the estimated 2025 high water requirement of 17.3 billion m 3 /annum. Current usage is estimated to be between 15 and16 billion m 3 /annum. Without effective metering and billing, consumption in urban and rural areas could rise to over 7.3 billion m 3 / annum resulting in an increase in total water use of close on 20 billion m 3 /annum. 7
It can be seen that current usage exceeds reliable yield and will mean that during a drought year it is likely that the country will experience water restrictions on a fairly large scale. Additional water resources need to be developed in order to provide for increased domestic water requirements. In future some Water Management Areas will need to develop additional local water resource bulk infrastructure. A National Bulk Water Services Infrastructure Programme has been established to address this deficiency. Additional funding for new bulk infrastructure requirements is estimated to be in the order of R50 million to R1000 million per project category. The DWA has completed first order reconciliation strategy studies for all towns in South Africa and identified the need for towns and cities to be able to better manage the utilization of their scarce water resources. These studies balanced water requirements and water availability in order to find integrated solutions for Water Services and Water Resources challenges that will inform the WSAs Water Service Development Plans (WSDPs) and the Integrated Development Plans (IDPs). In all these studies the need for effective water conservation and demand management was identified as a critical element. DWA is monitoring the implementation of the recommendations of these studies. It is worth noting that altough agriculture uses over 60% of our water, only 12% of South Africa s landmass is considered arable and only 3% truly fertile. Only 1.5% of the land is under irrigation, producing 30% of the country s crops, whilst 69% is given over to grazing and livestock farming. 8
Proportional water use per main economic sector How we use our water resources in South Africa Agriculture / Irrigation 60% Afforestation 3% Municipal/Domestic Domestic 27% total = 24% urban/ 27% total 24% urban 3% 3% rural rural Livestock watering and Nature Conservation 2.5% Mining ± 3.3% 2.5% Power generation 2% 4.3% Industrial ± 3% (if not part of Urban Domestic) 9
2.4 WATER MANAGEMENT AREAS The responsibility and authority for water resources management rests with Catchment Management Agencies (CMAs) and, at a local level, Water User Associations. These institutions are representative of water users and facilitate effective participation in the management of water resources in their areas and will ultimately enable the DWA to withdraw from its present role of operator to that of sector leader, policymaker, regulator and performance monitor. There are 9 planned Water Management Areas (WMAs) that will be decentralized to CMAs, namely Limpopo, Olifants, Inkomati-Usuthu, Pongola-Mzimkulu, Vaal, Orange, Mzimvubu-Tsitsikama, Breede-Gouritz and Berg- Olifants. Currently only 2 CMAs are operational, namely the Inkomati-Usuthu and Breede-Overberg CMAs, (and these will need to be reconfigured to allow for their increased coverage). A wide range of water resources management functions may be delegated to these CMAs, depending upon the local priorities and capacity, including: Developing strategies for integrated water resources management within the WMA; Developing and supporting organizations in the WMA, including coordination and capacity building; Regulating water use, including authorization and charging of water use; Managing information to support the other water resources management functions; Implementing physical interventions, including conservation and demand management and possibly infrastructure development and/or operation; and Auditing water resources management, in terms of the stated objectives of organizational business plans and water resources management strategies. 10
Water Management Areas (see page 2 for orientation map) 11
CMAs will need to be smart in the way they manage their catchments and adopt an Integrated Water Resources Management approach, an approach widely recognized, but poorly understood, even within the water sector. Although WUAs are water management institutions, their primary purpose, unlike catchment management agencies, is not water management. They operate at a restricted localized level, and are in effect co-operative associations of individual water users who wish to undertake water-related activities for their mutual benefit. 2.5 WATER TRANSFERS Water is unevenly distributed across the country and not always available where needed. To overcome this it is necessary to transfer water from areas where there is surplus water available to areas of need. An example is the Lesotho Highlands Water Scheme which supplies water to Gauteng s Vaal WMA through transfer from Katse and Mohale Dams in Lesotho. There are 28 interbasin transfer schemes with a total transfer capacity exceeding 7 billion m 3 /annum. 12
3. WATER SERVICES 3.1 WATER SERVICES BUSINESS LIFECYCLE Water Services is a nonstop delivery process from source to tap and from tap to source. It requires the natural resource (water), processing (treatment works), distribution infrastructure and effective operation to deliver the actual output (potable water & safe sanitation) and its ultimate outcome (healthy people). It requires much more than infrastructure and is dependent on sequential delivery along a value chain as illustrated in the adjacent diagram: Resource development Dam Water treatment works River Assimilative capacity of receiving water body Bulk infrastructure Bulk water pipeline Pumping station Wastewater treatment works Distribution reservoir Connector pipeline To other settlements Treated effluent outfall Impacts on aquatic environment and down-stream water users Distribution infrastructure Connector infrastructure Collector sewer Outfall sewer Internal pipe network Sewerage Sewerage pump station Internal infrastructure Sewerage reservoir 13
3.2 ROLE-PLAYERS Other key sector organizations involved in the Water Services business are: National Treasury, which financially supports DWA and other state departments to fulfill their support and regulatory roles in so far as these roles relate to fiscal and financial matters. The Department of Cooperative Governance, which ensures local government provides water services, regulates municipal services partnerships, ensures integrated municipal development planning, allocates funds to local government, regulates municipal affairs and with Provincial Government intervenes in cases of non-performing WSAs. The Department of Human Settlements, which sets national housing policy aligned to local government s water services policies and is responsible for the eradication of water services backlogs in informal settlements and from 2009 took over responsibility for sanitation from DWA. Water Services Authorities (WSAs) which are responsible for planning, implementing and operating the necessary infrastructure to provide effective, affordable and sustainable Water Services to their customers. Department of Rural Development and Land Reform whose focus is on agrarian transformation of agricultural systems and patterns of ownership and control especially in terms of irrigation schemes for small scale farmers. The South African Local Government Association which is an autonomous political association of municipalities with its mandate derived from the 2006 constitution of the Republic of South Africa. The Department of Health which ensures that all hospitals and clinics are provided with adequate water and sanitation facilities. The Department of Public Works which is responsible for implementing the community based public works programmes and often acts as the owner and operator of public buildings, including schools, hospitals, etc. 14
The Department of Environmental Affairs ensures that environmental impact assessments for water services projects are carried out, while promoting conservation, cleaner technologies and waste minimization. Water Utilities or Water Boards, which operate water resource infrastructure, manage bulk potable water supply schemes (selling water to municipalities and industries), and some retail water infrastructure and wastewater systems. Water Services Providers (WSPs) who provide water and/or sanitation services for municipalities and perform contractual lduties as specified by the WSA. WSP entities can be made up of public, private or mixed entities, or municipal government itself. Public or privately owned water companies such as Johannesburg Water, the Greater Nelspruit Utility Company and Siza Water Company (Dolphin Coast), which provide water services on behalf of the municipalities. The Department of Education is responsible for identifying schools that have no access to water services. The National Planning Commission, established by the Presidency, is responsible for developing a long term vision and strategic plan and for advising on cross-cutting issues that impact on long term development. The Water Research Commission, the Council for Scientific and Industrial Research, the Human Sciences Research Council, academic institutions, consultants and professional organizations such as the Cities Network, the Water Institute of South Africa, the Institute of Municipal Financial Officers, the South African Institute of Civil Engineers and the Institute of Municipal Engineering of South Africa. 15
3.3 CUSTOMER PROFILE 3.3.1 Demographics The 2011 population of 51.77 million consists of more than 30000 settlements, of which: 20.71 million people (or 40% of the population ) live in large metropolitan areas 9.84 million people (or 19% of the population) live in medium-sized cities and towns 3.10 million people (or 6% of the population) live in small towns in rural areas 18.12 million people (or 35% of the population) live in small rural villages and scattered settlements Within the metropolitan areas, cities and towns there are approximately 2.3 million informal households which are made up of 1.2 million households in informal settlements, 0.6 million households with shared services and 0.5 million rural households. It is estimated that more than 20% of the population in the major metropolitan areas and large regional centres have migrated from the rural areas. Unique to South Africa is seasonal migration, where families maintain a rural home during holidays. There are estimated to be approximately 6 million illegal immigrants. 3.3.2 Urbanization and average population growth rates The population growth rate has steadily declined since 2001, and has now dropped to below 1% per annum. According to the StatsSA General Household Survey of 2011, the number of households has grown at a rate of 3.3% per annum, indicating a reduction in the number of people per household. Since 1994 the average urban growth rate declined from above 2% to about 1% per annum while in rural areas it declined from over 1% to well below 1% per annum. 16
3.4 WATER SERVICES AUTHORITIES A municipality that has been accorded responsibility for ensuring access to water services is termed a Water Services Authority, (WSA). Although South Africa has 278 municipalities, (made up of 8 Metros, 44 District Municipalities and 226 Local Municipalities), not all are WSAs. There are 152 WSAs. Province District Municipality Local Municipality Metro Eastern Cape 5 9 2 16 Free State 0 19 1 20 Gauteng 0 7 3 10 KwaZulu Natal 10 3 1 14 Limpopo 4 7 0 11 Mpumalanga 0 18 0 18 Northern Cape 0 27 0 27 North West 2 9 0 11 Western Cape 0 24 1 25 Total 21 123 8 152 Grand Total 17
Water Services Authorities by Type (WSAs) (see page 2 for orientation map) Provincial Boundary WSA's by Type Metro DM LM 18
3.5 WATER BOARDS South Africa has 12 Water Boards that supply a total bulk potable water volume of approximately 2.46 billion m 3 /annum, (some 57% of the total domestic supply), have a total fixed asset value of R19.6 billion and a total operating cost of R5.6 billion per annum. Water Boards supply potable water to 28 million people (just over half the country s population), however they have a supply footprint which could reach 39 million people, (which represents approximately 11790 communities, including several large industries). The design capacity of their collective water treatment works is 3.1 billion m 3 /annum, which at the current level of supply is an average utilization of 79%. Some water boards have already reached their total design water supply capacity and major capital programmes are needed to upgrade existing schemes and build new regional bulk infrastructure. Not all municipalities depend on Water Boards for regional bulk water supply infrastructure, but can do so as long as they operate within the norms and standards of the Water Services Act, National Water Act and related regulations and strategies. Water Boards distribute raw and potable water across vast distances to multiple users (via regional water supply schemes). This role is mandated and fully controlled by the Minister of DWA. The Water Services Act added new responsibilities, in that Water Boards or any other water service providers must be formally appointed by the recipient municipalities to provide such services, where required. 19
There is an Institutional Reform and Realignment process underway in DWA, which is considering the restructuring of Water Boards to Regional Water Utilities, (RWUs), to improve efficiency and do away with non-viable Water Boards. The process has recommended that 12 Water Boards be realigned and reduced to 8 by March 2016. The RWUs will: Provide regional water resource infrastructure; Provide regional bulk water supply infrastructure; Provide local water supply infrastructure on behalf of municipalities; Support municipalities in mostly rural areas to build water services operational systems and management capacity through management contracts under a national support programme. Support municipalities with ad hoc services, based on negotiation with individual municipalities. 20
Water Boards (see page 2 for orientation map) Water Boards 5 1 2 Amatola Bloem Water 6 4 3 4 5 Botshelo Bushbuckridge Lepelle Northern 10 6 Magalies 3 7 8 Mhlathuze Overberg 11 7 9 10 Pelladrift Rand Water 9 2 12 11 12 Sedibeng Umgeni Water 1 8 21
3.6 BASIC LEVEL OF DOMESTIC WATER SUPPLY A basic household water supply is defined as 25 litres per person per day (or at least 6000 litres per household per month) and supplied according to the following criteria: Minimum flow rate of not less than 10 litres per minute; A standpipe within 200 metres of a household; Interruptions of less than 48 hours (at any one time) and a cumulative interruption time during the year of less than 15 days; and At a potable standard (SANS241). 3.7 MEDIUM AND HIGHER LEVELS OF DOMESTIC WATER SUPPLY In the longer term, government will strive to ensure that all households receive 50 to 60 litres per person per day via an individual connection. Currently, high and medium levels of domestic water use about 3.8 billion m 3 /annum (89% of the total urban and rural use), which translates to approximately 24% of the total water requirement. Unfortunately South Africa s gross average consumption is very high at 235 litres per person per day. 3.8 INTERIM SERVICE LEVELS Recent investigation has shown that a number of schemes are no longer functional, (see 4.5). The DWA recognized that the 2014 water services targets would thus not be met in time. Consequently an Interim/Intermediate Water Supply Strategy has been adopted to ensure that all the people of South Africa have access to water by the end of June 2014. This will be achieved by accelerating existing basic service delivery projects or by providing an interim water supply solution until more sustainable and permanent water supply solutions can be implemented. It will also include the rehabilitation and re-commissioning of non-functional schemes. 22
The DWA also identified that most of the water supply challenges are within 24 District Municipalities. All communities living in settlements that are greater than 50 households within these areas will receive a minimum interim water supply before 30 June 2015, either through a permanent water supply scheme or an interim or intermediate water supply intervention. The minimum standard for the interim/intermediate water supply is: 1. 10 litres per person per day of water within 500 meters of a household and fit for human consumption (SANS 241). 2. No consumer is without a water supply for more than seven full days in any year and no more than three consecutive days without water. Action plans have been drafted for every District Municipality. National Treasury has made substantial funding available through the Municipal Water Infrastructure Grant (MWIG). The relevant Water Service Authorities will implement these plans. 3.9 BASIC HOUSEHOLD SANITATION A basic toilet facility is regarded as a toilet which is safe, reliable, environmentally sound and easy to keep clean, provides privacy and protection against the weather, well ventilated, keeps smells to a minimum and prevents the entry and exit of flies and other disease-carrying pests. A basic level of sanitation in South Africa is regarded as a Ventilated Improved Pit Latrine (VIP) which is a dry toilet facility. The preferred temporary sanitation solution is a chemical toilet. Bucket toilets are unacceptable. 3.10 HIGHER LEVEL OF SANITATION There are a number of sanitation options that constitute a higher level of service. These are full waterborne sanitation, septic tanks, soak-aways and urine diversion toilets. 23
3.11 WATER SERVICES DELIVERY TARGETS 3.11.1 Basic Water and Sanitation Targets South Africa comes from a history of separate development which has resulted in many rural areas not having access to basic water supply and sanitation services. A dedicated Basic Services Development Programme initiated in 1994 is eradicating the historic backlogs according to specific targets: All people in South Africa have access to a functioning basic water supply facility by 2014. All people in South Africa have access to a functioning basic sanitation facility by 2014. 3.11.2 Millennium Development Goals (MDGs) South Africa has committed itself to international declarations on sustainable water services development, including the Earth Summit in Rio (1992), the UN General Assembly resolution on MDGs (2000) and the World Summit on Sustainable Development in Johannesburg (2002). The water services related MDGs are: To halve the proportion of people not having sustainable access to safe drinking water by 2015 using 1994 as a base year. This goal was achieved in 2005. To halve the proportion of people without sustainable access to a basic sanitation service using 1994 as a base year. This goal was achieved in 2008. 24
3.12 WATER SERVICES DEVELOPMENT PLANS The primary municipal planning instrument in the Water Services Sector is the Water Services Development Plan (WSDP). All Water Service Authorities (WSAs) must develop a 5 year WSDP which must be updated on an ongoing basis. The WSDP indicates how the WSA plans to provide universal access to water services, including the eradication of historical backlogs within its area of jurisdiction. The WSDP integrates technical, social, institutional, financial and environmental planning and feeds into the Integrated Development Planning (IDP) process. The WSA must report annually against the WSDP. A WSDP Guideline document, developed by the DWA can be utilized by municipalities to develop and update their WSDPs. Currently the DWA has received 140 draft or interim WSDPs and 10 Council approved WSDPs. Only two WSAs have not submitted any WSDP. The WSDP status countrywide can be viewed on the DWA website. 25
3.13 BASIC WATER SUPPLY PROGRESS 1994 Population (million) 2001 Population (million) 2011 Population (million) -taking into account schemes that are no longer functional Population 38.9 44.8 51.77 50.61 People below RDP 15.9 13.1 7.88 2.74 % People below 41% 29% 15% 5.3% RDP People equal to or 23 31.7 44.07 49.03 above RDP % People equal to 59% 71% 85% 94.7% or above RDP % Improvement since 1994 12% 26% 35.7% Information is based on Stats SA Census 2011 results. * Data based on DWA National Information System not yet aligned with the census 2011 data. * 2011 Population (million) ignoring schemes that have become nonfunctional 26
Despite the existence of a progressive informal settlements upgrading programme since 2004, informal settlement upgrading remains a daunting task. Water Supply Perspective: Households (Census 2011 STATS SA) Water in house or in yard Standpipes less than 200m Standpipes further than 200m Borehole, River, pool, dam, stream 10.6m (73%) 1.7m (12%) 0.9m (6%) 1.3m (9%) Total Households: 14.5 million Perspective 1: Households to be brought up to a bare minimum supply i.e safe source but still lacking quality Perspective 2: Total households to be brought to within 200m. Perspective 3: Total households to be brought to in-house/yard connections. 1.3m (6%) 2.2m (15%) 3.9m (27%) Note: These figures reflect access to infrastructure, not necessarily effective services e.g water quality, flow & sustainability 27
3.14 BASIC SANITATION PROGRESS In 2009 the Department of Human Settlements took over responsibility for sanitation provision from the DWA. Out of a total of 14.5 million households there are currently 4.5 million households without access to basic sanitation facilities. Although there has been an improvement from 48% to 69% in terms of access to sanitation since 1994, in spite of the population increase, a great deal of effort is still required to accelerate delivery of sanitation services. 1994 Population (million) 2001 Population (million) 2011 Population (million) Population 38.9 44.8 51.77 People below RDP 20.4 19.5 16.1 (4.5 mil HH) % People below RDP 52% 43% 31% People equal to or above 18.5 25.3 35.8 (10.0 mil HH) RDP % People equal to or 48% 57% 69% above RDP % Improvement since 1994 9% 21% Information is based on Stats SA Census 2011 results. From the above it is clear that the target date of 2014 to eradicate backlogs will not be met without a huge financial injection combined with appropriate project management skills. Political pressureto provide full waterborne sanitation as a basic level of sanitation is severely impacting on the cost of service provision and operation in certain parts of the country. 28
Sanitation Perspective: Households (Census 2011 STATS SA) Flush toilet (connected to sewer systems or septic tank) 8.7m (60%) VIP 1.3m (9%) Unacceptable None, pit latrine, chemical, buckets (.3m) 4.5m (31%) Total Households: 14.5 million Perspective 1: Total households to be brought to VIP 4.5m (31%) Perspective 2: Total households to be brought up to flush toilet level of service. 5.8m (40%) Note: These figures reflect access to infrastructure, not necessarily effective services 29
3.15 BASIC WATER SERVICES DELIVERY NEEDS The present WS Needs (2011) are reflected below: Service Type Estimated Backlog -April 2011 Annual Required Target to achieve 2014 delivery goals Basic Water Supply 7.9 million people (2.2 million HHs) 2.6 million people (0.7 million HHs) Basic Sanitation 4.5million HHs 1.5 million HHs Information is based on Stats SA Census 2011 results. The StatsSA General Household surveys indicate little, if any, growth in access to water infrastructure over the period 2006 to 2009. This is probably due to the failure of existing infrastructure as a result of the lack of an operation and maintenance programme. 30
Community Water Needs (see page 2 for orientation map) Water Backlog = 2. 74 Million People 2012 Perspective Community Water Needs Percentage of Population 0 % 1-25 % 26-50 % 51-75 % > 75 % 31
Community Sanitation Needs (see page 2 for orientation map) Sanitation Backlog = 4. 5 Million Households 2012 Perspective Community Sanitation Needs Percentage of Population 0 % 1-25 % 26-50 % 51-75 % > 75 % 32
3.16 FREE BASIC WATER A basic level of water is provided free to all households that earn less than the poverty line, which was defined as less than R800 per household per month in 2001 and which relates to approximately R1180 per household per month in 2012. Free Basic Water (April 2012) % Population Served with FBW % of the Poor Served with FBW 2008 84% 73% 2012 77% 80% * Data based on DWA National Information System not yet aligned with the census 2011 data. The Free Basic Water programme is implemented in all Water Service Authorities. 4. KEY WATER SERVICES PERFORMANCE AREAS 4.1 MUNICIPAL STRATEGIC SELF-ASSESSMENT DWA uses a Municipal Strategic Self-assessment (MuSSA) to check the overall business health of a municipality/ Water Service Authority (WSA) and identify key areas of vulnerability. Sixteen key areas of service performance vulnerability within a WSA are assessed. These municipal water services business attributes are: 33
1. Water Services Development Planning 2. Management Skill Level 3. Staff Skill Levels 4. Technical Staff Capacity 5. Water Resource Management 6. Water Conservation & Demand Management 7. Drinking Water Quality 8. Wastewater/ Environmental Safety 9. Infrastructure Asset Management 10. Operations & Maintenance of Assets 11. Financial Management 13. Information Management 14. Organizational Performance 15. Water Service Quality 12. Revenue Collection 16. Customer Care Five essence questions per business area are asked. Answers to the questions provide strategic vulnerability flags. The scores are translated into percentages and a dashboard is provided using a Spider-Diagram that presents a vulnerability snapshot of the overall water and sanitation business of the local authority. The MuSSA can be updated at any subsequent stage by the municipality for its own purposes. A typical Spider-Diagram output is presented on the following page. 34
Currently only 3% of Water Services Authorities indicated that they are operating in a satisfactory manner, whilst 18% are at risk, 33% at high risk and 46% are in crisis. 35
Municipal Vulnerability Municipal Vulnerability Limpopo Gauteng Mpumalanga North West Free State KwaZulu-Natal Northern Cape Eastern Cape Status Western Cape No of WSA's % Very High Vulnerability 70 46.1% High Vulnerability Moderate Vulnerablity 50 32.9% Low Vulnerability 36 27 17.8% 5 3.3% 152 100.0%
4.2 NON-REVENUE WATER Non-revenue water, (NRW), the term used by the International Water Association (IWA) to represent the level of losses/unauthorized use from an urban water supply scheme, is defined as the volume of water for which no income is received by the water services institution. The IWA water balance has been modified for the South African situation, (see overleaf). It is estimated that non-revenue water in South Africa is approximately 36.8% of the water supplied, (according to the latest Water Research Commission study). When using this value, it is important to recognize the following: The Free Basic Water allowance is considered to be part of the revenue water component and is charged at a zero rate. Non-payment of accounts is a completely separate issue and water that is billed through the normal accounting process is considered to be revenue water whether or not the account is ever paid. 36% NRW is a typical average value by world norms, but below the norm for a developing country. Although the NRW estimate compares well with international trends, there is definite scope for improvement as the gross average consumption of 235 litres/person/day is much higher than the international average of 177 litres/person/day. The NRW figures are highly influenced by data from the metropolitan and large city municipalities (as high volume users) which currently represents 80% of the available data set. Very little quality information is currently available on rural municipalities. Lost revenue amounts to some R11 billion a year in the municipal sector alone, based on an assessment of 132 WSAs. South Africa s President has called for a 50% reduction in municipal water losses by 2014 and this now a key performance area for government. 37
Standard IWA Water Balance ( modified for South Africa) System Input Volume: 1. Total water treated and measured at treatment works outlet 2. Total water pumped directly from boreholes into reticulation system 3. Total water purchased from bulk water services provider Unaccounted for Water (UAW/UFW) Authorised Consumption: 1. Billed metered water 2. Billed un-metered water 3. Unbilled metered water 4. Unbilled un-metered water Total Losses: Total water not used for legitimate purposes 1. Apparent losses 2. Real losses Billed Metered: 1. Water is billed for based on a metered consumption (see further explanatory notes) Billed Un-metered: 1. based on a meter reading) 2. Free basic water used through unbilled unmetered standpipes or yard connections (see further explanatory notes) Unbilled Metered: 1. Usually very small in RSA can include government buildings or parks that is metered but not billed. Unbilled un-metered: 1. Estimated water used for legitimate purposes such for unmetered unbilled standpipes and yard connection usage (see notes) Apparent Losses: 1. Water used through illegal connections 2. Water used but not billed for because of inaccurate meters 3. Water used but not billed for because of data transfer errors, low estimated readings or any administrative errors. Real Losses 1. Water that leaks from the system through pipes Revenue Water: 1. Billed metered 2. Billed un-metered Non Revenue Water: 1. Unbilled metered 2. Unbilled un-metered 3. Apparent losses 4. Real losses 38
Percentage Non-Revenue Water 39
Findings from a recent DWA assessment of the 8 Metros, (which supply 46% of the country s urban water use), are shown in the table below. These figures are as of December 2012. Metro % NRW % Water losses *ILI Johannesburg 37.8 36.5 8.3 Tshwane 23.8 22.9 5.6 Ekurhuleni 40.8 31.8 5 ethekwini 35.6 35.3 6.8 Cape Town 20.7 15.2 2.1 Nelson Mandela Bay 43.1 32.4 4.4 Buffalo City 47.7 28.9 3.5 Mangaung 39.5 35.7 6 Weighted Average 33.7 29.7 5.7 *Infrastructure Leakage Index indicates leakage compared to a benchmark likely minimum value. Values typically range from 1, (best practice), to 10 which indicates that losses are 10 times the benchmark value. 40
Water Consumption (litres per capita per day) 41
4.3 DRINKING WATER QUALITY 4.3.1 Water Treatment Works Drinking water must comply with potable water quality standards as specified in SANS 241 (Class 1). Most water sources require treatment to comply with the drinking water standard. The map shows the location of the 923 municipal owned water supply systems. The table below provides more detail about these works. Prov No of supply Systems Design capacity (Ml/day) Output volume (Ml/day) % capacity utilised EC 163 989.1 797.2 81% FS 76 218.5 164.5 75% GP 32 4102.9 3337.9 81% KZN 187 1362 1146.6 84% LP 64 803.4 670.2 83% MP 80 660.7 501.5 76% NC 155 577.5 402.1 70% NW 43 170.9 121.7 71% WC 123 2663.4 1646 62% Total 923 11 548 8 788 76% 42
4.3.2 Drinking water quality compliance At present many rural communities are not served from water treatment works and are still reliant on groundwater and other local water sources. Compliance to drinkingwater standards must address all elements in the water supply system including sampling of water at the intake and the outflow of the water treatment works, in distribution pipelines and reservoirs and at the point of use. DWA has adopted a risk based management approach (Blue Drop Certification) whereby all of these variables are assessed to Average Provincial Scores Prov 2009 2010 2011 EC 79.4% 77.3% 82.1% FS 48.5% 64.1% 73.6% GP 85.5% 95.1% 98.1% KZN 65.9% 80.5% 92.1% LP 79.4% 77.3% 79.4% MP 65.4% 56.5% 60.9% NC 46.9% 62.1% 68.2% NW 66% 62.3% 78.7% WC 92.5% 94.1% 94.2% 43
4.3.3 Blue Drop Certification The 2012 incentive based Blue Drop Compliance assessments resulted in 98 water supply systems being awarded the prestigious Blue Drop Status. Comparison of the Blue Drop score over the past 3 years indicates a definite improvement in most provinces, with WC and GP scoring the highest and MP, NC, NW and FS the lowest. blue drop CERTIFICATION drinking water quality REGULATION Prov BLUE DROP AWARDS 2011 No. of Supply Systems EC 163 9 FS 76 7 GP 32 16 KZN 187 16 LP 64 2 MP 80 11 NC 155 1 NW 43 3 WC 123 33 Total 923 98 Blue Drop Awards 44
4.4 WASTEWATER TREATMENT 4.4.1 Wastewater Treatment Works Wastewater treatment is a critical performance area as it impacts directly on human health and on the environment and indirectly on downstream drinking water purification systems. Currently there are 826 municipal owned WWTWs in South Africa. There are a total of 1286 municipal and privately owned works with the following treatment technology/process: 45
4.4.2 Wastewater Quality Compliance DWA issues WWTW licences and regulates WWTWs and effluent releases through a risk-based assessment and the incentive based Green Drop certification process. Critical performance indicators include the design and operating capacity of the wastewater treatment works, compliance of the effluent to agreed standards, the technical skills of the management authority and the condition of infrastructure (i.e. asset management practices). The combined risk rating (map) and condition of WWTWs (graph) show the extent of the problems in RSA 46
4.4.3 Green Drop Certification The 2011 Green Drop incentive based regulatory assessments resulted in an increase from 32 to 40 of the 152 WSAs obtaining the prestigious Green Drop Award. Of these, 19 are in WC, 11 in KZN and 5 in GP. The rest of the provinces have almost no awards and very low Green Drop scores (<40%). The average Green Drop score is 71%, but is skewed by WC, KZ and GP. The next assessment will take place in 2013. The following indicators highlight the extent of the wastewater problem in 2011. 317 of 826 WWTWs (38%) require attention 143 WWTWs have a high risk of failure >20% are significantly over-utilized 64% of WWTWs require urgent refurbishment and improved maintenance 90% of WWTWs are non-compliant on more than 3 final effluent determinants Technical and management skills are inadequate in most rural schemes. 47
4.4.4 Waterborne Diseases South Africa has a mortality rate in children under 5 years of age of between 65 and 70 per 1000 births. The major cause of these deaths is diarhoeal in nature, and is particularly prevalent in informal settlements and rural areas. Diarrhea is a symptom of an illness which can indicate the presence of high levels of e-coli in drinking water. The death rate can be greatly reduced by the provision of a basic supply of potable water. The Millennium Development Goal calls for a two-thirds reduction in the under-five mortality rate between 1990 and 2015. 4.5 SCHEME FUNCTIONALITY Since 1994 the focus of Government was only on the provision of basic water services infrastructure. The challenge of effectively operating and maintaining this infrastructure is ongoing. Effectively sustaining this infrastructure requires infrastructure asset management. Few Water Service Authorities practice proper management of their water services infrastructure and as a result there are regular service failures resulting in non-functionality of schemes, customer dissatisfaction, threats to health and financial losses. Deteriorating service of late caused 71 water related protests in 2012. There are approximately 1689 water schemes in South Africa. 9% are currently totally dysfunctional at present and lie mainly within the 24 DMs which cover the pre 1994 old homeland areas. Some 48% of schemes are in urgent need of refurbishment. Water treatment and wastewater treatment works are generally in poor condition, with 66% of WWTWs requiring short to medium term intervention, 35% requiring capacity upgrades and 56% requiring additional skilled operating and maintenance staff. 48
Typical Functionality Problems Category Type of problem Governance/ No enforcement of regulations Policy Inadequate bylaws/regulations Unsustainable policy/level of services Institutional No capacity to manage Corruption Financial Cost of supply greater than income Equitable share less than O&M costs No revenue collection Tariffs not affordable Community Excessive demands Non-payment Plumbing leakages Vandalism/theft and illegal connections Inadequate community buy-in Inadequate education Typical Functionality Problems Category Type of problem Technical/ Operational problems Operations Condition and age of infrastructure Lack of maintenance Badly designed infrastructure High level of leakages Electricity interruptions Inadequate infrastructure Water Insufficient water supply resources Abstraction problems Poor management Droughts Pollution of WR 49
4.6 ASSET MANAGEMENT In order to ensure long term effective water services delivery, an Asset Management process must be followed when buying or creating an asset, and when maintaining, replacing and disposing of assets in a cost effective manner. This process is depicted in the below diagram. 50
Looking after water services infrastructure is just as important as building new infrastructure for future demands. In terms of the Water Services Act it is a legal requirement for every Water Service Authority to have an Asset Management Plan. WSAs must protect their assets by ensuring that an appropriate maintenance and rehabilitation plan is developed and implemented. Unfortunately a number of WSAs do not budget sufficiently for asset maintenance and replacement. Expensive refurbishment becomes necessary and then there is less money for ongoing maintenance. Deteriorating infrastructure also leads to poor service delivery and reduced levels of payment by consumers due to dissatisfaction, exacerbating lack of cost recovery. DWA is currently developing an infrastructure asset management strategy, tools and processes to assist WSAs ensure that their assets are properly managed and maintained. 51
5. WATER BUSINESS MANAGEMENT 5.1 SECTOR INVESTMENT 5.1.1 Sector Investment Framework According to the National Investment Framework for the Water Sector, the total capital replacement value of all water supply infrastructure and associated services for potable and non-potable systems is in the order of R850 billion. The split of assets is given in the table below (Rbillion). Institutional Potable water Non-potable Bulk Water Total Split grouping distribution and distribution Water Resources sanitation Local government 275 88 30 392 46% WUAs and individual 99 96 194 23% private users Waterboards 98 5 103 12% DWA 37 123 160 19% Total 275 136 186 253 849 100% Split 32% 16% 22% 30% 100% The National Investment Framework for the Water Sector also sets out the investment requirements for both existing and new Water Rource and Water Services infrastructure. 52
In deriving these needs it was assumed that: Basic infrastructure backlogs must be eradicated by 2014; Eradication of the refurbishment backlogs must take place over the next 4 years; and Implementation of large water resource projects take on average 10 years. Allowance was also made for essential Water Conservation and Demand Management initiatives. It was found that the annual total investment need for Water Resource and regional bulk is R22.9billion/annum, and the annual total investment need for internal bulk and reticulation is R43.6billion/annum. This gives a total investment requirement of R67billion/annum. This is shown in the table below. R billion 2021 New 2021 Upgrade 2021 Rehab 2021 Total Sanitation 90 51 141 Water supply (potable) Local infrastructure Internal 27 4 40 71 Connector: potable 27 43 70 Local bulk 30 22 52 Sub-total local potable 84 4 106 194 Regional bulk 45 34 79 Total potable water 129 4 140 272 Non-potable distribution 10 32 42 Water resources 149-64 213 TOTAL 378 4 287 668 53
Increasing the implementation timeframe for backlog eradication from 4 years to 8 for refurbishments and basic services backlogs and from 10 to15 years for water resources and bulk infrastructure reduces the annual need from R67billion/annum to R47billion/annum. After eradication of all backlogs (regional bulk and internal reticulation) the annual requirements reduce to about R30billion/annum. A large amount of infrastructure investment is therefore required over the short term, municipal needs are significant and current budgets cannot meet this need. Current provisions fall far short of actual requirements at municipal level and the gradual decline in percentage capital expenditure of total municipal budgets will aggravate the situation. Considering the nature and extent of capital required, it is inevitable that some of the financial requirements will have to be met with loan funding and that most of the economic developments will have to be co-funded by beneficiaries. The biggest concern is with municipalities who lack the necessary revenue streams to co-fund their current obligations. Improved financial management at municipal level is thus also key to successful implementation of the investment framework. 54
5.1.2 Municipal Grant Funding 55
The yearly Division of Revenue Act sets out the various government grants. The largest conditional capital grant is the Municipal Infrastructure Grant (MIG), which provides funding for a basic level of municipal infrastructure, principally for extending access to water and sanitation to poor households. In 2011/2012 the MIG expenditure on basic water services was as follows: R3.2billion on basic water supply projects R2.1billion on basic sanitation projects This R5.3billion was however only 83% of the municipal allocation for water services. It is estimated that the total capital expenditure on water and sanitation for 2012/13 will be R8.77billion and R4.94billion respectively. The MIG allocation for water and sanitation (R billion) for the current and future years Province 2012/13 2013/14 2014/15 Eastern Cape 1.75 1.84 1.98 Free State 0.44 0.46 0.50 Gauteng 0.16 0.17 0.18 KwaZulu-Natal 1.87 1.98 2.12 Limpopo 1.54 1.63 1.75 Mpumalanga 0.82 0.87 0.93 North West 0.76 0.81 0.87 Northern Cape 0.25 0.27 0.29 Western Cape 0.18 0.19 0.20 National Total 7.77 8.20 8.82 56
There is also an unconditional grant called the Equitable Share, which is provided to all municipalities to assist with operation and maintenance requirements and free basic services provision. Equitable Share for water and sanitation (R billion) Province 2012/13 2013/14 2014/15 Eastern Cape 46.94 49.60 52.22 Free State 18.53 19.47 20.41 Gauteng 54.55 58.61 62.88 KwaZulu-Natal 67.80 72.58 77.55 Limpopo 38.72 40.97 43.17 Mpumalanga 24.87 26.29 27.70 North West 8.26 8.74 9.23 Northern Cape 20.61 21.91 23.21 Western Cape 28.77 30.75 32.98 National Total 309.05 328.92 349.35 57
5.1.3 Regional Bulk Infrastructure Grant (RBIG) The rapid increase in Water Services infrastructure provision at municipal level has necessitated the need for more regional bulk water schemes, currently estimated at R83.2billion for regional bulk, R47.1billion for internal bulk, R40.4billion for sanitation and R1.6billion for implementation readiness studies (total current estimated requirement is R172billion). The RBIG Programme was established in 2007 to support capital funding of the social component of new bulk infrastructure. The core drivers of the programme are: The increased dependency on bulk infrastructure to meet the basic services targets; The scope and size of bulk projects (e.g. priority developments such as the Olifants River Development Scheme that requires at least R3billion for bulk water services infrastructure over and above water resources and reticulation requirements). All projects must be implementation ready before funds are allocated. To initiate the programme R1.4billion was made available by Treasury over three years. To date a further R5.2billion has been made available, with another R2.9billion proposed in the Division of Revenue Act for 2013/14. Currently bulk funding levels are too low and this is delaying the implementation of projects. The below table sets out the regional bulk funding allocations. R billion Project Status 2010/2011 Allocation 2011/2012 Allocation 2012/2013 Allocation 58 Total 3 year Allocation Projects Ongoing 0.829 1.646 2.523 4.998 Feasibility Studies Ongoing 0.023 0.066 0.026 0.115 DWA Management/ 0.018 0.027 0.055 0.100 Coordination National Totals 0.870 1.739 2.604 5.213
5.1.4 Municipal Water Infrastructure Grant (MWIG) The MWIG aims to assist Water Services Authorities to provide water services to consumers currently without a basic water supply, particularly those in rural areas, through the facilitation, planning, acceleration and implementation of various projects. This will be done via the Department of Water Affair s (DWA s) Interim/ Intermediate Water Supply Programme, (see 3.8). The purpose of this programme is not to duplicate other existing programmes, but to supplement them where there are gaps and to also provide short-term and quick win solutions. The programme will address functionality related problems as well as new infrastructure requirements. A target date of 30 June 2015 has been set. The programme will initially focus on the 24 District Municipalities with the highest backlogs. Projects must be identified by municipalities and form part of their Integrated Development Plan and Water Services Development Plan. All receiving municipalities are required to conclude formal agreements with DWA prior to implementation. A technical team comprising DWA, DCOG, Water Boards, the WSA and the Municipal Infrastructure Support Agency must approve all projects where the cost of the project is above R20 million. The budget allocations are as follows: 2013/14 R602 million 2014/15 R1 059 million 2015/16 R2 671 million Total R 4 333 million 59
5.1.5 Human Settlements Development Grant (HSDG) This grant is aimed at the creation of sustainable human settlements through the facilitation and provision of access to basic infrastructure, top structures and basic socio-economic amenities. It is also intended to provide employment and skills development during the delivery of infrastructure. The upgrading of informal settlements is an important component of this grant, which is managed by the Department of Human Settlements. R16.9 million has been allocated for 2013/14. 5.1.6 Rural Households Infrastructure Grant (RHIG) This grant, which is managed by the Department of Human Settlements (DOHS), was introduced in 2010/11, following the transfer of the sanitation function from the DWA to the DOHS. It is intended to supplement existing funding of sanitation programmes by providing for the rapid rollout of on-site water and sanitation infrastructure, (rainwater tanks and VIP toilets), for rural households whose location makes it impractical to connect them to piped water and sanitation services. R106.7 million has been allocated for 2013/14 60
5.1.7 Operating Revenue The latest GDP figures per sector indicate that the total sales value of Water Services is about R33billion per annum. The distribution of this value amongst water users is shown in the pie chart. Of the municipal sales, 62% comes from domestic residential use and 38% from commercial and industrial use. 61
5.1.8 Operating Expenditure (OPEX) The operating cost for water supply is indicated in the table below. Total (R per kilolitre used) Distribution system 1.60 6.170 Bulk water used 3.30 12.725 Bulk water lost 0.66 2.545 WR infrastructure cost 1.00 3.856 Raw water lost 0.30 1.157 CMA charge 0.20 0.771 Total cost at point of use 7.06 27.223 Note: 1 kl = 1 m 3 Typical operating costs are shown in the pie chart. National averages indicate that operating costs for water supply are about 13% of the total municipal OPEX while sanitation services are about 4%. Trends show a marginal, insufficient increase in repairs and maintenance. Total amount (R billion 2012 estimate) 62
5.1.9 Tariffs To sustain water and sanitation services it is essential to recover costs and to maintain institutional financial viability. Paying for water is vital and an effective payment mechanism is required to ensure water is used effectively and sparingly. To achieve this, suitable tariffs must be set by all relevant water services institutions involved. The water and sanitation pricing chain is depicted below. Water Resource Management Charge water resource management 7 treatment and return of water to the river 6 human excreta and wastewater collection waste discharge charge bulk wastewater tariff 5 1 raw water from rivers, dams, boreholes and springs raw water tariff (water resource development charge) bulk water treatment and bulk water distribution bulk water tariff recticulation of water to consumers sanitation charge consumer retail water tariff 4 2 3 63
Tariff/charge Water resource management charge. Raw water tariff (WR development charge- recovers infrastructure and operating costs of schemes). Bulk water and wastewater tariffs in order to recover cost of conveying and treating bulk water and wastewater. Retail water tariff and sanitation charge, (includes bulk water and wastewater tariff). Waste discharge tariff. (A water resource charge based on polluter pays principle). Responsibility for setting tariff and source of authority CMA in terms of National Water Act. DWA where there is no CMA. DWA in terms of the Water Act and the National Raw Water Pricing Strategy and in consultation with water users including local government. Negotiation between WB and WSA or its appointed provider. WSA where it undertakes function itself. Consultation between WSA and external provider of service. WSA in terms of the WS Act and Municipal Systems Act. Regulated by WSA (subject to DWA oversight). DWA sets national norms and standards for setting of retail tariffs. CMA in terms of National Water Act, in consultation with water users including local government. DWA where there is no CMA. DWA monitors all tariffs along the water provisioning cycle annually, including water management charges, raw water tariffs, water board tariffs and municipal tariffs for domestic, commercial and industrial users. This indicates that the real value of water is not fully reflected in the tariffs and that it can be expected that the cost of Water Services will rise when water resources become limited and/or water quality deteriorates. 64
a) Raw Water Tariffs The raw water charge is made up of a resource management charge, a Water Research Commission levy, consumptive charges and a Trans Caledon Tunnel Authority levy to users benefitting from the Lesotho Highlands Water Project. For 2011/12 raw water tariffs increased on average by 12%. b) Bulk Water Tariffs For Water Boards, the average bulk potable water tariff is currently R3.34 per m 3. This cost varies widely from R2.15 to R8.58 per m 3 subject to the availability of water, the distance of distribution and raw water quality. On average in 2011/12 tariffs increased by 14%. c) Municipal Water and Sanitation Tariffs All Water Service Authorities are required by legislation (WS Act and MFMA) to establish tariff policies and set tariffs on an annual basis. The tariffs must take into account the operational costs, capital repayments, refurbishment and asset management needs. DWA monitors and reviews the municipal water and sanitation tariffs annually and takes the necessary regulatory action where service increases are inappropriate and not in support of national objectives. In 2011/12 water tariffs increased by 8-12%. Sanitation tariffs decreased by 8% for basic sanitation and increased by 22% for waterborne sanitation. Average domestic water tariffs are shown in the graph overleaf. Municipalities use a rising block tariff for water, where the first block covers the Free Basic Water component, (6kl/household/month). For sanitation, municipalities resort to a number of different tariff models. Examples are metered volume of effluent, tariff markup on metered water use, multiplier of property value or land size, tariff per household and flat rate. 65
Average Water Tariffs Tariff Component Amount Average 2011/12 tariff Water Resource Management Charge R0.02 per kl Raw Water Water Research Fund Levy R0.04 per kl R 1.37 per kl Water Resource Infrastructure Charge R1.30 per kl Bulk Water R5.41 per kl 0 to 6 kl R2.74 per kl 6 to 20 kl R6.85 per kl Domestic 20 to 60 kl R8.83 per kl Over 60 kl R10.98 per kl 0 to 6 kl R7.31 per kl Municipal Water Commercial Industrial Municipal Sanitation Note: 1 kl = 1 m 3 6 to 20 kl R8.18 per kl 20 to 60 kl R9.49 per kl Over 60 kl R10.68 per kl 0 to 6 kl R7.98 per kl 6 to 20 kl R 8.61 per kl 20 to 60 kl R9.85 per kl Over 60 kl R10.85 per kl R100 per month 66
d) Bulk Wastewater Tariffs DWA has a Waste Discharge Charge System (WDCS) in place. This is based on the polluter pays principle, made up of the following four components: Basic charge: independent of pollution level based on volume of discharges Load-based charge: proportional charge per waste load Deterrent charge: progressive charge per waste load Rebates: better quality than abstracted 6. ACHIEVEMENTS Since 1994, DWA has embarked on an ambitious program to eradicate backlogs in water supply and sanitation, underpinned by the development of sound sector policy and legislation. The Water Services Act was promulgated in 1994, and defined the role of DWA as regulator, the role of Water Boards as bulk providers and the role of municipalities as service providers, while the National Water Act of 1998, redefined water rights in SA and established a new framework to mandate and regulate water resources. Initially, the water and sanitation delivery programme was driven by the DWA. In 2003 responsibility for service provision was transferred to local government, bringing with it the need to support and build capacity at this level. The Strategic Framework for Water Services was published to guide Water Service Authorities in carrying out their service provision role. In 2010 DWA s emphasis moved from support to regulation. The National Water Services Regulation Strategy was adopted and the Blue and Green Drop incentive based regulatory processes were conceived. These have been implemented with a visible improvement in drinking water and wastewater quality. Much has been done to assist local government to effectively deliver on its mandate. 67
Since 1994 no less than 21.1 million people have benefitted from a basic supply of water. Similarly 17.3 million people have received at least a basic level of sanitation. DWA has met and exceeded the MDG targets. DWA also developed and implemented the Free Basic Water Policy that ensures that the poor are not denied access to water due to financial constraints. DWA has continued to successfully manage the country s water resources and in 2004 published a National Water Resource Strategy. More recently the DWA carried out its All Towns Studies where the water resources for every town were studied, compared to future requirements and a reconciliation strategy developed for implementation. DWA is currently revising its National Water Resource Strategy and is also amending both the Water Services and National Water Acts. 7. CHALLENGES TO SUSTAINABLE SERVICE DELIVERY The water sector faces the following challenges: There is no surplus water in South Africa. Available water resources are at their limit and climate change will worsen the situation. Due to water scarcity all pollutants and effluent streams will increasingly need to be treated to ever higher standards before being discharged. A study of 905 towns, (excluding Metros and large cities,) found that 28% have inadequate water resources. Water has to be distributed over large areas and difficult terrain at high cost to service the remaining needs. Waste Water Treatment Works are generally in a poor condition and many are over capacity, which will increase the environmental health risk. Municipal water consumption per capita is unacceptably high. 68
There is a lack of water demand management and poor water use efficiency across the sector. There is a lack of capacity, in particular technical capacity, within WSAs and especially as regards infrastructure asset management, with the result that infrastructure fails and service delivery suffers. Many municipalities are unable to provide sustainable services or run a successful WS business because of lack of capacity and skills. Achieving the basic water supply and sanitation targets is problematic because of: Limited funds that are available for bulk water infrastructure requirements. Informal settlements where conventional water services solutions do not apply. Leakage of municipal grant funding provided for basic services provision to higher levels of service. A fragmented service delivery approach where responsibilities for water services have been delegated to a number of government departments such as DWA, DCOG, DHS and WSAs. Other impacting factors that affect the achievement of targets: Significant household growth due to smaller household size, migration and an influx of illegal immigrants into metropolitan areas. The introduction of higher levels of service in urban and rural areas which are not in accordance with the basic services policy. The increased demand for waterborne sanitation versus dry sanitation. Infrastructure focused targets which have neglected longer-term sustainability requirements. The incorrect inclusion of operations and maintenance and service quality as backlog issues. Inadequate local water resources which require major regional water resource developments. 69
7.1 MUNICIPAL CAPACITY A recent Municipal Demarcation study (2011) indicated that only 72% of municipal posts were filled and only 76% of municipal organogram posts were budgeted for. Of the funded posts 33% were vacant. The average municipal manager remained in his post for 3 years and possessed only 9 years relevant work experience, whilst the technical manager had 11 years experience. Half of the technical managers are under-qualified and unable to adequately manager their infrastructure. There is an ongoing chronic shortage of municipal engineers and a high management turnover with 25% of management posts being vacant for more than 3 months. 1 in 6 managers exited the municipality in the course of the year. Research carried out for the publication of Numbers and Needs in Local Government (2005) by A Lawless found that the civil engineering capacity, (expressed as civil engineering professionals per 100 000 people), in local government tis too low to deliver, operate and maintain local government infrastructure in a sustainable manner; (apartheid South Africa had 20 engineers per 100 000 people). This has now dropped to 3 per 100 000. 70
8. FOR FURTHER INFORMATION CONTACT PLEASE CONTACT: Mr Allestair Wensley Telephone (W): +27 12 336 8767 Fax: +27 12 336 6609 Email: wensleya@dwa.gov.za OR VISIT THE WEBSITE: www.dwa.gov.za/dir_ws/wsnis 71