Departments of Social Development, & Water and Sanitation (with Minister & Deputy) on their 2014 Strategic Plans

NCOP Social Services

22 July 2014
Chairperson: Ms L Dlamini (ANC, Mpumalanga)
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Meeting Summary

The Department of Social Development (DSD) briefed the Committee on its budget and Strategic and Annual Performance Plans for 2014, as well as those of the two entities, National Development Agency (NDA) and South African Social Security Agency (SASSA).The mandate of the DSD was to facilitate social protection, under Government Outcome 13. Over the Medium Term Strategic Framework period, the DSD intended to reform the social welfare sector and services to deliver better results, to improve the provision of Early Childhood Development (ECD) opportunities, as well as access to nutrition, health care, education, social care and safety for all children, to deepen social assistance and to extend the scope for social security. It would also strengthen community development interventions, establish social protection systems to strengthen the coordination, integration, planning, monitoring and evaluation of services, and improve household food and nutrition. The main aims of each of the programmes were outlined. Specific areas were highlighted. DSD intended to develop a Special Needs Housing programme and train 400 women in business management. It expected to process 27 000 applications for social assistance during 2014/15. The number of social assistance grant beneficiaries had decreased between March 2013 and December 2013, because the re-registration process identified and removed many ineligible people from the system. However, it was anticipated that by 2016/17, social assistance grants would be paid to 16.6 million beneficiaries. In particular, services would be improved for older persons, children and people with disabilities. The DSD was engaged in discussions around the universalisation of the Older Person’s Grant and the Child Support Grant. The implementation and roll-out of an integrated appeals business information system was expected to speed up turnaround times for adjudication of appeals. The White Paper’s implementation would be reviewed, and the DSD was planning to award 1 100 new scholarships in the next financial year. Allocations for children had increased, for the ECD audit and to rollout the Isibindi community-based model to respond to orphaned and vulnerable children. For older persons, the Golden Games, to promote active ageing, were to be co-funded by provinces and Department of Sport and Recreation. DSD planned to create 42 517 work opportunities, capacitate 3 000 NPOs, train 48 cooperatives and give access to food for 600 000 people through community development feeding programmes. Allocations of R10 million per year were given to improve registration and monitoring of NPO services for the Department. R120 billion was intended for beneficiaries of social grants, and R6.4 billion to administer South African Social Security Agency (SASSA). Drug rehabilitation centres were to be established in five provinces. DSD had achieved a clean audit in the last year

Members asked what timeframe the DSD set itself to reduce the vacancy rate to 10%, asked when a drug rehabilitation centre would be established in Limpopo province, stressing that it was a developmental node, and thought the budget for drug rehabilitation was inadequate. They asked if the amounts allocated for social assistance would decrease as people became self-sustaining. Members asked why the DSD were recruiting social auxiliary workers, instead of focusing on women already doing home-based care. They questioned the roles of the DSD and Department of Basic Education for ECD programmes, and the links with the Department of Sport and Recreation (SRSA), and what they were doing for the disabled. More details were requested on the priority districts. Members asked if the two additional functions that DSD was to take over from the former Department for Women, Children and People with Disabilities, had been costed and budgeted for. They welcomed changes to the means test but asked if this was to be phased out altogether. They urged that more attention be paid to attitudes and training of social workers, and highlighted that children’s issues needed more attention.

The Department of Water and Sanitation (DWS), with the Minister and Deputy Minister, presented its 2014 Strategic Plans and budget, and pointed out that this Department had recently been tasked with the additional functions for sanitation and was in the process of drawing a new organogram. An overview was given of all water sector institutions, their reporting lines and how they related to each other. The DWS would receive 33% of the entire water sector budget, at R12.5 billion, whilst R10.4 billion went to the Water Trading Entity, R11.7 billion to Water Boards, and R3.6 billion to the Trans Caledonian Tunnel Authority. Employment figures for each were given. The Strategic and Annual Plans took into account Constitutional requirements, international agreements and treaties, internal development strategies and, in recognition that implementation was at provincial and local level, was also aligned with Integrated Development Plans. The DWS aimed to provide safe water for all, and to effectively manage water resources to ensure equitable and sustainable socio-economic development and universal access to water. It operated through nine provincial departments and had four operational clusters. Some of the programme strategic focus areas were described. The DWS aimed to monitor 1 900 ground water sites, 1 600 gauging stations and 1 400 sampling points. It would conduct public hearings on amending the National Water Act and complete the National Water Resources Strategy implementation plans in this year. It planned to create 2 441 job opportunities, through the Regional Infrastructure Grant programme, and have 82 schemes under construction, including two wastewater treatment works. 5 916 jobs should be created through the War on Leaks programme. The Water Sector Regulation programme was intending to release the 2013/14 Blue Drop report and 1 084 water supply schemes would be assessed, as well as water users being checked for compliance.

Specific descriptions were given of the work of the Water Trading Entity, which would create over 4 000 job opportunities through its augmentation projects. 44 Dam Safety Rehabilitation projects were planned. There were nine Water Boards, all of which were public entities who delivered in designated areas, but whose main challenge related to the high level of debt from municipalities. Catchment Management Agencies, which were Public Finance Management Act Schedule 3A entities, delegated resource management to the catchment level and involved local communities in the decision-making processes. Four had been gazetted to date. The Water Research Commission had one of the strongest combined water services and sanitation research portfolios in the world. It received 80% of its income by way of levies and 20% from local and international sources. The Trans-Caledon Tunnel Authority was originally established in 1986 to fulfil South Africa’s obligations under the Treaty on the Lesotho Highlands Water Project, but its mandate had subsequently been expanded to include other non-Treaty functions, the funding and implementation of bulk raw water infrastructure, and other functions set out in Directives by the Minister. It was a PFMA Schedule 2 entity. It arranged commercial funding for off-budget schemes for implementation of bulk raw water resource infrastructure. The Komati Basin Water Authority had legal status in South Africa and Swaziland, was established under the bi-lateral Treaty on the Development and Utilization of the Water Resources of the Komati Basin, but was investigating extending this Treaty to extend also to Mozambique. It was responsible for various phases of dams being constructed and operated on the Komati River Basin, and five other potential sites had been identified.

Members asked whether there were any partnerships with the Departments of Education to teach children to conserve water, and partnerships with the Department of Health. They asked why, in numerous listed areas, people living around a dam had no access to water from it. They were concerned that Mbombela, the most-populated municipality in Mpumalanga, with many protests around access to water, was not listed as due to have a dam built. Progress reports were requested for the Jozini and Mzimvubu Dams. They asked how the DWS audit outcome would be affected if municipalities failed to spend their Municipal Infrastructure Grant on water as expected. Time frames for specific projects were requested, and Members stressed that better coordination was still needed between water reticulation and human settlement planning. They asked why more municipalities were not being given a water mandate. They asked how the DWS would manage on a reduced budget, were pleased that so much of the budget was going to achieving real service delivery, but asked also how DWS would try to ensure that it received sufficient budget to provide universal access to water at the required level, and what Parliament could do to assist. They urged the DWS not only to address leaks, but also illegal connections.

Meeting report

Chairperson’s opening remarks
The Chairperson noted the apologies from the Minister and Deputy Minister of Social Development. She noted that this Committee exercised oversight over five departments, namely the Departments of Social Development (DSD), Water and Sanitation (DWS), Home Affairs, Human Settlements and Health.

The Chairperson asked all presenters to ensure that documents reached the Committee well in advance of the meetings, to allow Members and Committee Section staff enough time for analysis in preparation for their questions. She stressed that oversight was not about policing the departments, but about adding value and strengthening what they were already doing, since the Committee Members took an independent and objective view.

Department of Social Development (DSD): 2014 budget and strategic plans
Mr Coceko Pakade, Director General, Department of Social Development, led the delegation consisting of all the senior managers in the Department, including the management of the two entities under its control:  the National Development Agency (NDA) and South African Social Security Agency (SASSA). He said the departmental programme for the next five years was based on key decisions which had been taken by the ruling ANC party at its 53rd Conference at Mangaung and the National Development Plan (NDP), which had been adopted at that conference.

The Minister of Social Development was tasked with driving Outcome 13, which dealt with social protection, as found in Chapter 11 of the NDP, and this formed the broad mandate for the DSD.

Mr Pakade said that there was notable success in poverty alleviation through social assistance, but there were areas which needed radical transformation. The NDP detailed the shortcomings of the welfare services, and this led to the proposals that DSD must transform welfare significantly, focussing on social service professionals. There was a need to increase all social service professionals, which included social workers, auxiliary social workers, child and youth care workers, and the need to professionalise meant a greater focus on re-training and re-orientation. DSD also aimed to expand the services it rendered. The NDP spelt out also what was needed in the non-profit organisations sector, which was fundamental to delivery of social development services. All of this would be seen in the Strategic Plan.

Slide 10 in the presentation set out the six priorities, straddling three pillars of social development. The intention of the DSD was to track and ensure the welfare and progress of humans, “from conception to the grave”. It had programmes dealing with social security, as entrenched in section 27 of the Constitution. DSD looked to what must be done for the vulnerable in society. Through SASSA, social assistance programmes were offered, including the Social Relief of Distress programme, and the Integrated Development programme, which focussed on empowering and developing social assistance recipients to become self-sustaining, by using a wide spectrum, including food security. Mr Pakade noted that Welfare Services programmes were found in any proper developmental state, where the State looked after people who were particularly vulnerable due to disability, old age or other reasons. The National Development Agency dealt with community development.

All priorities looked to transforming the welfare sector, which was a monumental task. A Ministerial Committee was presently tasked with reviewing the entire 1997 White Paper on Welfare Services.

Early Childhood Development (ECD) was currently one of the apex priorities of government and the DSD had developed a plan of action for it.

The DSD also had to implement reforms in social security. It would focus on retirement reforms, as part of the comprehensive reforms planned by government, which would also include the National Health Insurance (NHI) scheme, the Unemployment Insurance Fund (UIF), the Road Accident Fund (RAF) and others.

SASSA was in the process of modernising its payment systems. Through the system of re-registration and fraud management, SASSA saved R3 billion in the previous financial year through better fraud management.

Mr Pakade said that the Food Security programme was part of the new Household Food and Nutrition strategy, which linked up with other key departments of Agriculture and Rural Development and Land reform.

Finally, he noted that the President had announced two new functions for the DSD, which were previously located with the former Department of Women, Children and People with Disabilities, but these were still in the process of being transferred.

These functions were still in transition and it would be apparent in the presentation.

Ms Nelisiwe Vilakazi, Deputy Director General: Strategy and Organisational Transformation, DSD, tabled and took Members through the Annual Performance Plan. She repeated that the key sector priorities over the Medium Term Strategic Framework (MTSF) were:
- to reform the social welfare sector and services to deliver better results
- to improve the provision of Early Childhood Development opportunities and access to nutrition, health care, education, social care and safety for all children
- to deepen social assistance and extend the scope for social security
- to strengthen community development interventions
- to establish social protection systems to strengthen the coordination, integration, planning, monitoring and evaluation of services
- to improve household food and nutrition.

She outlined the subdivisions of Programme 1: Administration, and said that the entity oversight programme would, in 2014/15, review the Entity Oversight strategy and develop a performance management system for public entities. The Strategy Development and Business programme would develop a special needs housing programme and train 400 women in business management.  A diagnostic evaluation of violence against women and children was planned. The bulk of spending in Programme 1 went to compensation of employees, which constituted on average 5.5% of the budget, and operating leases for office accommodation, which constituted on average 8.8% of the goods and services allocation. 

Programme 2: Social Assistance, expected to process 27 000 applications for social assistance in the 2014/15 year. The bulk of spending went to the grants for child support, old age and disability, which reflected government’s commitment to supporting the most vulnerable in society by providing income support. The number of social assistance grant beneficiaries had decreased, from 15.9 million in March 2013 to 15.6 million in December 2013, due to the re-registration process that had removed ineligible people from the grant system.

Programme 3: Social Security Policy and Administration aimed to complete the Discussion Papers on the universalisation of the older person’s grant and the child support grant. Its focus for spending continued to be transferring money to the South African Social Security Agency (SASSA), which was the grants administering entity. 98.6% of this programme’s allocation went to SASSA. It would, in turn, use the money for improving its fraud management system and ensuring that social assistance grants were paid to an estimated 16.6 million beneficiaries by 2016/17. Social grant administration costs had constituted 6.4% of the budget for social assistance grants in 2010/11, but were expected to decline to 5.2% in 2016/17, partly due to better efficiencies from the new payment contract implemented in 2012/13. The implementation and roll-out of an integrated appeals business information system was expected to speed up turnaround times. It was hoped to bring the proportion of appeals adjudicated within 90 days to 70% by 2016/17

Programme 4: Welfare Services Policy Development and Implementation Support, planned to review the implementation of the White Paper. It would award 1 100 new scholarships in 2014/15. It also planned to expand and improve its services to older persons, children and people with disabilities. There was a target to have 20 000 people who worked with children screened in terms of the Child Protection Register (CPR) requirements. This programme also planned to train six national departments and NGOs on the White Paper for Families. It would build capacity on and monitor the Fatherhood and Active Parenting Programme for teenagers. The sub-programme for children had increased its spending, with additional allocations over the last two years that had gone to the ECD audit, and on systems to facilitate the rollout of the community-based Isibindi model, which aimed to respond to the needs of orphaned and vulnerable children.

A key cost driver in the Older Persons sub-programme was the Active Ageing Program (Golden Games) in which older people participated and competed in various sporting activities in order to promote active ageing. Costs relating to this were carried by the DSD in the previous year, but the present decreases were due to new cost sharing arrangements between provincial departments and the National Department of Sports and Recreation.

Programme 5: Social Policy & Integrated Service Delivery, aimed to create 42 517 work opportunities, establish 9 Kwanda sites, and capacitate 3 000 NPOs and 350 provincial officials in NPO governance. It also planned to support 400 change agents, seven food distribution centres, establish 20 food depots and get 600 000 people to access food through community development feeding programmes, and train 48 cooperatives.

The National Development Agency (NDA), through transfer payments, implemented sustainable community driven projects that provided support to NPOs working on ECD, food security, and employment creation. Between 2013/14 and 2016/17, expenditure would increase as there was an additional allocation provided for food security through the Food for All programme (carried out in the Community Development sub-programme). Non-profit organisations would administer the food relief programmes to various households. There was a target to feed 1.4 million people, through numerous hunger relief initiatives, such as food banks and community nutrition development centres, by 2016/17.
The DSD received R10 million for each year of the MTEF period for the improvement of the sub-programme for registration and monitoring of Non-profit Organisations, to improve the efficiency of management of the NPO’s database.

Mr Pakade noted that the DSD budget for 2014/15 was R128.8 billion, including the allocations for the SASSA and NDA. At the moment, SASSA did not have an independent vote, but was included in the DSD vote. The heads of DSD and SASSA held dual responsibility for its work, and had cultivated a close working relationship. Since SASSA was established, there had been reforms in the way in which social assistance had been delivered, not least making this a national competency. When social assistance was previously a provincial competency, there was room for fraud, and there had been an unfortunate tendency for lawyers to exploit weaknesses in the functioning and encourage beneficiaries to sue the Department. Now, however, the Internal Appeals Unit had been established, reporting to the Minister, where beneficiaries’ grievances must be addressed before resorting to litigation.

The allocations to SASSA were R120 billion, to pay out to beneficiaries for the 2014/15 FY, and R6.4 billion to administer SASSA, of which R75 million went towards improving fraud preventing measures.

Mr Pakade then described the allocations by programme. Administration received R275 million, Social Assistance R121 billion, Social Security Policy and Administration R6.7 billion, Welfare Services Policy Development and Implementation Support received R586 million and Social Policy and Integrated Development received R323 million. A more detailed breakdown of allocations for each specific programme was given (see attached presentation), which showed R120.9 billion for Social Assistance, R6.4 billion for SASSA, R75 million for fraud investigations, R264 million for social worker bursaries, R22.7 million for National councils, R50.9 million for the loveLife HIV Awareness Campaign, R29 million as a Substance Abuse Conditional Grant, R41 million for Food and Nutrition Security. The NDA received  R178.3 million, for the purposes of developing drug treatment centres in the five provinces that currently lacked these facilities.

The DSD audit for the 2012/13 financial year was clean, although it had previously received unqualified audits before. File and registry management had improved. The audit process for the 2013/14 financial year was currently underway, and the CEO of SASSA had met with the auditors the previous day. The picture looked positive. A fire in KwaZulu Natal (KZN) had destroyed 5 million files, but thanks to the re-registration and electronic records, the files could be recreated to the satisfaction of the Auditor-General (AG). Certain matters were highlighted that needed to be addressed, such as debtor management and supply chain issues, but the DSD was engaging with the Office of the AG.

Mr D Stock (ANC, Northern Cape) asked how the DSD was planning to make the process to register NPOs more efficient. He also wanted more details from the DSD on what the outcomes of the social security reform would be.

Ms T Mpambo-Sibhukwana (DA, Western Cape) asked what SASSA’s planned interventions were to secure and protect the elderly at Omatshonisa, as they were being victimised.

Ms Mpambo-Sibhukwana asked what time-frame the DSD had set itself to reduce the vacancy rate to 10%.

Ms Mpambo-Sibhukwana asked when a rehabilitation centre for substance abusers would be established in Limpopo Province.

Mr M Khawula (IFP, KZN) said the cross-border problems were still affecting the province of KZN. Foreign nationals were benefiting, as well as people from the Eastern Cape.

Mr Khawula noted that the money earmarked for SASSA was increasing over the MTEF, and asked if this would continue, or whether there was an intention that it should stabilise and then decrease, as beneficiaries started to become self-sustaining.

Mr Khawula said there did not seem to be a clear-cut division of roles between ECD and the Department of  Basic Education.

Ms T Mampuru (ANC, Limpopo) reiterated Ms Mpambo-Sibhukwana’s question when a drug treatment centre would be established in Limpopo, as it did not appear in the budget. She made the point that this was a developmental hub and mining houses drew people from various countries, so the facility was needed.

Ms Mampuru wanted more detail on the 23 prioritised districts for Ministerial Outreach Programmes, reminding the DSD that the Select Committee focused on provinces.  

Ms Mampura asked how the DSD might link up with the Department of Sport and Recreation (SRSA) as well as both Departments of Education, to empower people with disabilities. Some were in institutions, some were at home, some could be educated and others trained. She also asked if there were ways to facilitate their access to Further Education and Training (FET) colleges.

Ms L Zwane (ANC, KZN) said she was delighted to see that the DSD made bursaries available to train more social workers, but asked for an explanation why, at the same time, DSD was recruiting veterans back into the system, and whether they would supplement the number of new candidates, or provide specific expertise.

Ms Mampuru asked whether the two additional functions the DSD had “inherited” from the former Department for Women, Children and People with Disabilities, had been costed and budgeted for.

Ms Mampuru said that another colleague would be happy to see the changes to the means test, and more people previously excluded would be able to benefit. She asked if there was an intention to abolish it altogether.

The Chairperson said the issue of ECD was critical to education. If government wanted to build the nation it had to invest more, and address the lack of coordination. She noted that the DSD, Departments of Education and local government had to play their roles, but at present, local government had no specific budget to provide infrastructure, and this would not work, as they tended to put money to other priorities like water, sanitation and roads, so she felt a specific grant was needed. In addition, she urged the DSD to name those responsible for driving EC.

The Chairperson noted that the DSD was recruiting social auxiliary workers, yet there were many existing home-based carers, who tended to work for agencies who were paid well, whilst the carers were paid badly and were not even given basics such as surgical gloves. She asked why the DSD was not making home-based care a specific programme, tracking money that it gave to NPOs and appointing existing carers as  social auxiliary workers.

The Chairperson commented that the budget for substance abuse was insufficient, and pointed out that it was mainly addressing the youth, and so the country’s future was at stake. She urged DSD to run the programme itself, not outsource it, to achieve progress.

The Chairperson said the recent incidents of violence against children highlighted the plight of children in South Africa, and crime against children often happened behind closed doors, which made it more difficult to detect.

The Chairperson said the attitudes of social workers needed to improve, and urged that they be re-trained as they were not doing what was expected of them.

Mr Pakade said that the questions were cross-cutting across the broad services of the DSD and the services SASSA offered. He would answer most of the questions in writing, but wanted to comment briefly on a few issues.

Mr Pakade admitted that cross-border flow was a general challenge to many government departments, but was being addressed. In relation to the critical issue of violence against children, the DSD had a programme of action on gender-based violence, approved by Cabinet, which the Inter-Ministerial Committee had developed, and the DSD had partnered also with UNICEF. The Minister would be briefing the Press on this. The DSD had also established a Gender-Based Violence Hotline during 2013.

Mr Pakade said, in conclusion, that the questions posed by the Members were valuable input. Most of the issues raised were in the Strategic Plan – for instance, details about the overhaul of the welfare services, attitudes of social workers, and the reorientation, training, mentoring  and supervision by veteran social workers. He would provide written responses to all questions.

Department of Water and Sanitation 2014 Strategic Plans and budget
The Chairperson welcomed the Minister, Nomvula Mokonyane and Deputy Minister Pam Tswete, as well as the delegation from the Department of Water and Sanitation (DWS or the Department). She reiterated to this Department that oversight was not so much about  policing the Department, but about strengthening and assisting it. She noted that the Committee did not get the documents in time, and urged that in future they must be sent in sufficient time for the Members to study them and make a meaningful contribution.

The Minister apologised and said that she took responsibility for the late arrival of the documentation, which would not happen again. She noted that the Department of Water and Sanitation had been established concurrent with the start of the Fifth Parliament, when the sanitation component was added to its water component. The presentation had been informed by the 2014/15 Annual Performance Plan, but the Department had been re-considering its organisational design under the new mandate and this was work in progress. The Department was also giving priority to implementation of the NDP.

Mr Trevor Balzer, Acting Director General, Department of Water and Sanitation, tabled and explained the structure of the presentation (see attached document). Part A was a strategic overview. This set out the vision, mission and legislative mandate of the Department. It also included an overview of water sector institutions, how they related towards each other and how authority fanned out and trickled down from the Minister to the Water Boards (WBs), Catchment Management Agencies (CMA)s and their subsidiaries, the Trans Caledon Tunnel Authority (TCTA), Water Research Commission (WRC) and the Komati Basin Authority (KBA) (see presentation for full details on structures)

The Water sector budget for 2014/15 was R38.2 billion, and was divided,  with 33% (R12.5 billion) for the Department of Water Affairs (DWA), 27% (R10.4 billion) for the Water Trading Entity (WTE), 31% (R11.7 billion) for the WBs and 9% (R3.6 billion) for the TCTA.

The DWS was the biggest employer in the sector, employing 7 336 staff, while the Water Boards employed 5 996. The TCTA employed 146, the KBA had 43, but no number was given for Catchment Management Agencies.

Part B dealt with an overview of the Strategic and Annual Performance Plans (APP). The APP was developed and would operate within the legal frameworks of the Constitution, as well as legislation which had a bearing on water as a life sustaining resource within South Africa and the world. South Africa complied with various international agreements and treaties such as the Millennium Development Goals, the Framework for Climate Change, and the Sustainable Development Goals (post 2015 agenda), and its internal policies must be exercised within these frameworks. DWS must also comply with national obligations and development strategies such as the National Development Plan (NDP), and the New Growth Path (NGP), and the APP was also aligned with these. Water was essentially linked to human activity,  and DWS also had to align its APP to deal with its relationships with the Departments of Trade and Industry (DTI), Environmental Affairs (DEA), and Rural Development and Land Reform (DRDLR). Because the APP was implemented in the provinces and municipalities, it must also be aligned with local Integrated Development Plans (IDPs). Oversight was exercised by the two Houses of Parliament. Finance was provided by National Treasury (NT), whilst the Department of Performance Monitoring and Evaluation, and Department of Public Service Administration monitored DWS’s administrative integrity.

Mr Balzer stressed that the DWS had a goal to provide safe water for all, by effectively managing the nation’s water resources, to ensure equitable and sustainable socio-economic development and universal access to water. He tabled a “strategy map” showing inter-relationships to achieve this goal.

The Department had nine provincial offices and four operation clusters. The sanitation function used to be located in the Department of Human Settlements, but now had to be integrated into the DWS. The presentation stipulated that the integration plan would run up to 26 September 2014, but stated that the change management would be ongoing. There was an overview of current sanitation projects in the Free State, Limpopo, North West and the Northern Cape.

Mr Balzer then outlined some of the main focus areas for each programme. In Programme 1: Administration, the Department planned to reduce the vacancy rate to 10% and comply fully with its internal controls.

Under Programme 2: Water Sector Management, the Department planned to improve water resources and water services information, as well as improve the protection of water resources and ensure their sustainability. It planned to monitor 1 900 ground water sites, 1 600 gauging stations and 1 400 sampling points. It aimed to conduct public hearings on amendments to the National Water Act and complete the National Water Resources Strategy implementation plans in this financial year.

Programme 4: Regional Implementation and Support, showed a target of creating 2 441 job opportunities through the Regional Infrastructure Grant (RIG) programme. Under the Regional Bulk Infrastructure (RBIG) programme, it planned to have 82 schemes under construction, of which 10 should be completed in 2014/15, and to construct two wastewater treatment works. It planned to create 5 916 jobs through the War on Leaks programme and provide 144 491 households with a basic water supply in the 24 priority districts.

Under Programme 5: Water Sector Regulation, the 2013/14 Blue Drop report would be released and 1 084 water supply schemes would be assessed. Water users from different industries would be monitored for compliance. 140 dams would be assessed for compliance to dam safety regulations, 100 mines would be assessed for compliance within the mining sector, 12 users would be assessed for compliance within industry, and 36 users would be assessed for compliance within the agricultural sector, 

Mr Balzer noted that the Water Trading Entity (WTE) also had some specific goals. It complied fully with supply chain management procedures that were set and monitored under DWS’s Programme 1. There was a target for the WTE to create 4 050 job opportunities through its many augmentation projects (see attached presentation for full details) including the Clanwilliam Dam wall and 184 job opportunities through its Dam Safety Rehabilitation Programme. It planned to complete 44 Dam Safety Rehabilitation Projects.

Under the presentation slides for Programme 6: International Water Cooperation, the fees that South Africa paid towards international support circles like International Relation Management and Support (R8 million), Africa Cooperation (R11.5 million) and Global Cooperation (R13 million) were listed.

Financial details
Mr Balzer noted that the presentation slides contained a detailed layout of the Department’s spending plans for the 2014/15 year, and also summarised the spending to 27 June 2014. (See presentation for details of payment schedules). Furthermore, he pointed to a comprehensive analysis of the Water Trading Entity Budget, as well as the cash flow summary (see presentation for full details)

Giving an overview of the budget, as contained in Part C, Mr Balzer summarised that the allocation was R12.5 billion for the 2014/15 financial year. 62% (R7.8 billion went towards Regional Implementation and Support, 24% (R2.9 billion) went towards Water Infrastructure Management, 5% (R598 million) went towards Water Sector Management, 8% (R1 billion) went towards Administration, and 1% (R122 million) went towards Water Sector Regulation. R1.4 billion went towards the Compensation of Employees and R5 million was payment for capital assets. (See presentation for more financial information and spending figures over the medium term)

Part D of the presentation summarised the DWS Monitoring and Evaluation. The DWS had implemented a Departmental Strategy Management (DSM) module to rationalise reporting with the following components:
Strategy mapping - meaning a schematic depiction of the vision, mission and underlying steps to achieve goals
Initiatives – execution of the strategy with summary priority matrix
Scorecard- a “traffic light” illustration of performance information with indicators and associated targets
Dashboard - a broad view of performance,  by drawing information from multiple sources and displaying them in a single panel.

Overview of Entities
Water Boards

Mr Balzer said that the Water Boards were public entities which conducted their primary business in accordance with a mandate derived from legislation and government/sector policies and protocols. They were very important, as all socio-economic development within their designated area of supply was linked to the delivery of reliable, healthy and cost effective bulk services. There were 9 water boards in South Africa - Amatola, Bloem, Lepelle, Magalies, Mhlathuze, Overberg, Rand, Sedibeng, and Umgeni. Their biggest challenge was that municipalities owed water boards a total of R2 922 billion. (See presentation for detailed information of water boards and their catchment areas).

Catchment Management Agencies
Catchment Management Agencies (CMAs) were established in terms the National Water Act, Act 36 of 108 of 1998 (Chapter 7). Nine CMAs were to be established nationally. CMAs were subject to the Public Finance Management Act (PFMA) and related Treasury regulations, and were categorised as Schedule 3A (“service delivery public entity”) entities.

The purpose of the CMAs was to delegate water resource management to the catchment level and to involve local communities in the decision-making processes. The three overarching roles of CMAs were articulated in the Act:
1) management of water resources in a WMA
2) co-ordinating the functions of other institutions involved in water related matters
3) involving local communities in water resource management

Four CMAs had been gazetted, and these were Inkomati-Usuthu, Breede-Gouritz, Pongola-Mzimkulu and Limpopo-North West (see attached presentation for all details)

Water Research Commission: Strategic and Annual Performance Plan
Mr Balzer described the Water Research Commission (WRC) as “the water sector’s Knowledge House”. It drew on the best research capacity in South Africa, and had very good international partnerships, leading to South Africa having one of the strongest combined water services and sanitation research portfolios in the world. A key focus area was the empowerment of South Africa’s transformation agenda through knowledge, science and innovation (see attached presentation for strategic objectives and performance indicators)

The Water Research Levy (WRL) was WRC’s main source of income. The WRL was receivable in terms of the Water Research Act. The WRL currently constituted 80% of the WRC’s total income. The other sources of income were leveraged from both local and international sources, and full details were set out in the presentation.

Trans Caledon Tunnel Authority (TCTA) Strategic and Annual Performance Plans
Mr Balzer explained that the TCTA was established in 1986, under a Notice of Establishment in terms of the National Water Act, to fulfil South Africa’s obligations in terms of the Treaty on the Lesotho Highlands Water Project. Its mandate had subsequently been expanded to include other non-Treaty functions, the funding and implementation of bulk raw water infrastructure, and other functions set out in Directives by the Minister. It was regulated under the PFMA as a Schedule 2 entity.

The TCTA arranged commercial funding for off-budget schemes for implementation of bulk raw water resource infrastructure. Although the Lesotho Highlands Water Project was funded with a government guarantee, there were other “off-budget” schemes that did not carry a government guarantee. A revenue stream was secured through off-take agreements with water users to service debt. Off-budget projects were rated by Fitch Ratings – and all were currently rated AA+.

The presentation listed the specific TCTA contributions to government outcomes.

A summary of the budget was given (see attached presentation for all figures). There was increased activity and spending on the new mandates, including phase 2 of the Lesotho Highlands Water Project, whilst other projects were in final phase, or in close-out (see attached presentation). 

Mr Balzer said that the “Directly Controllable Expenditure” was R337 million. He explained that the increased running costs resulted directly from increased project activity. “Indirectly Controllable Expenditure” was R1.107 billion. The figure for the Variable royalties increase was based on Eskom selling price increases, and Operations and Maintenance costs for the two projects. Tariff Billing was listed at R4.89 billion. Billing for some other listed projects had commenced, and most increases in projects were based on inflation and estimated volumes. The funding Requirement was R3.985 billion in order to meet expected capital expenditure, running expenditure and finance charges.

Komati Basin Water Authority (KOBWA) scheme: Overview
The KOBWA scheme was established in terms of the Treaty on the Development and Utilization of the Water Resources of the Komati Basin, which had been signed by the Heads of State of the Republic of South Africa and the Kingdom of Swaziland in 1992, with the consent of Mozambique. It had legal status in both countries through Government Gazettes notifications.

The mandate comprised of the design, construction, operation and maintenance of Phase 1 of the Komati River Basin Development Project, comprising the Driekoppies Dam on the Lomati River in South Africa and the Maguga Dam on the Komati River in Swaziland.

The primary functions of the DWS in the KOBWA Project related to the design, construction, operation and maintenance of dams and accessory infrastructure.  Secondly, it had mandates in relation to resettlement, compensation, beneficiation and environmental impact mitigation in the Project area. Thirdly, the DWS was responsible for Project financial management, including loan raising and repayments.

It was explained that the DWS was further involved in reviewing the Treaty to expand its scope to new functions and to optimise return on existing overheads and dam operating systems It was  identifying and pursuing opportunities in new trans-boundary dam development initiatives, water service delivery, development and management implementing agency. There had been five other dams sites identified in the Komati River catchment area. The DWS was bidding for the expansion of its role from bi-national sub-catchment to a tri-national catchment wide platform, which would include Mozambique.

Mr Stock thanked the Department for the comprehensive and well-detailed presentation. He noted that the DWS had allocated funding to the different municipalities, as approved by Cabinet, in the form of the Municipal Infrastructure Grant. However, he asked how it would affect the audit outcomes of the DWS, if the municipalities did not spend the funding as they should.

Ms Mpambo-Sibhukwana complimented the Department on its interventions during the baby deaths in the North West. She sought further information on time frames for specific projects.

Ms Zwane said the Department of Human Settlements had been reconfigured some years ago, with the aim of coordinating development more efficiently. However, it was still the case that on the ground, it might happen that water was being reticulated in one direction whilst housing development was happening in another direction. This meant that the district and local municipalities were not planning together regarding the provision of bulk infrastructure. She wanted to know what the DWS could do to counter this.

Ms Mpambo-Sibhukwana asked whether there was any collaboration between the DWS and the Department of Health (DOH).

Ms Mpambo-Sibhukwana said children had to be taught to save water, and so also enquired if the DWS had any partnerships with the Departments of Education.

The Minister said the Department had awareness programmes about saving water and conservation, and there were efforts to promote partnerships with the different sectors, including the education sector. In June 2014, the Deputy Minister had addressed the youth at a Youth Summit on the importance of proper water use.

Ms P Mququ (ANC, Eastern Cape) asked for an organogram of the DWS.

The Minister replied that the Department was still in the process of reorganising and redesigning itself and it planned to do so within this FY. The new organogram would also incorporate the sanitation services component.

Ms Mququ asked for a progress report on Project Mzimvubu Dam.

Ms Zwane pointed out that the people living in the immediately-surrounding areas were not benefiting at all from the large Jozini Dam in KZN.

The Minister said the Department would provide progress reports on both Mzimvubu and Jozini Dams. She concede that as long as people in Jozini did not have water for themselves, then the DWS must be judged as having failed to deliver.

Ms Mampuru said there were many instances in Limpopo also, a prime example being the De Hoop Dam, where the people living around the dam did not have a fresh water supply. She recognised that most of the challenges were located at municipal level, but urged that the DWS needed to put pressure on municipalities. She was not sure about the wisdom of relaxing the legislation, but asked why the DWS did not allow more municipalities to become water authorities.  

The Minister replied that there was an assumption that every municipality had the capacity to provide water, but that was not correct. Municipalities had to collect refuse, close potholes, and create capacity to deal with the basic services people needed on a daily basis. The South African national government was responsible for water provision. It was not good practice to duplicate roles and responsibilities.

The Chairperson said she appreciated the state of preparedness of the Minister and Deputy Minister because they were providing answers to questions before they were asked. She also thanked the DWS for its hard work, because as representatives from the provinces, Members could see the benefits to communities on the ground. This was a very important department, because 99% of the protests which happened over the last few years were about the availability of clean drinkable water. However, the budget allocated did not reflect the importance of water. The Department had indicated, on a previous occasion, that it would require a budget of R570 billion if it were to provide universal water access at the required level. She asked what the DWS was doing to address the inadequacy of the budget. She understood that universal clean water provision would not guarantee peace, but she was sure it would lessen protest incidents. She asked what the Committee could do to assist. She noted that this Department had spent 62% of its budget on service delivery, which was what was expected of a department such as this.

Mr Khawula referred to the war on leaks as mentioned in the presentation. He asked whether the DWS could not also include a war on illegal connections, because huge volumes of water were stolen, in some cases by commercial farmers.

The Chairperson noted that the budget for the Water Sector Regulation Programme had decreased by R2.2 million, and, linked to previous questions, asked how the DWS would perform the function listed with the reduced budget. This issue was also linked to the large number of unregistered dams. People complained that the registration process was very complicated. Furthermore, there were also questions around the illegal connections. She asked the Minister to look at the budget for this programme, so that it could be dealt with.

The Minister agreed that the Water Sector Regulation Programme was faced with challenges from illegal connections and unregistered dams, and that there were financial constraints. However, the DWS recognised that whatever money was available had to be used well. She had a philosophy of not looking at the figures first, but at the ability and resources the Department had. All available resources had to be used well, and there must be real impact in the communities where the money was spent. Only then would the Department be entitled to ask National Treasury for more money.

The Chairperson referred to the Annexure, listing projects planned for the next ten years. She noted that Mbombela, in Mpumalanga, was not on the list, although it had the largest population and was not currently serviced by a dam. Many smaller municipalities around it had two to three dams, or were planning to build more. Mbombela was one of the municipalities most affected by protests around water, especially bulk water. Another project was also not listed under the budget  figures. The Hoshana Scheme in Mpumalanga had been “forever” under construction; when she had joined the Mbombela Municipality in 2011, it was “about to be commissioned” but still had not been. This Scheme was supposed to service both Mbombela and Bushbuckridge municipalities. She urged the Department to follow up on these issues, and change the way that the projects were being managed. Large amounts of money had been spent on consultants, who had not delivered, and were then fired and replaced with another set of consultants, only to have the process repeat itself. A dam was urgently needed to cater for the growing population in Mbombela.

The Minister replied that in the efforts to provide access to water in the Mbombela municipality, the DWS had to deal with the attitudes and assumption of municipalities. The main challenge in Mbombela related to how Mbombela Municipality chose to deal with the water-related matters, and to compare the plans with what as actually happening on the ground. At one stage Mbombela had an international company to fulfil the function. On the previous weekend, the Minister had had to intervene in Mangaung, because it also thought it could manage the situation.

The Minister said that some of the issues raised would only be resolved once the Department had finalised the review of the Water Act, because that Act currently created a lot of contradictions around the roles and responsibilities of the different role players. Most of the protests and challenges had to do with local authorities, their responsibilities in terms of water and their capacity to deliver it. It would not help simply to “throw money” at the problems, but engagement and making the necessary interventions were the routes that the DWS must follow. The strategy now was to take the money to the project and then to track the money – as the Department had done with the Bloemhof Dam project. The Department also visited three provinces to meet with the premiers, MECs and mayors, to reflect on the state of water and sanitation, and to collectively plot a way forward. This would extend to other provinces also. She stressed that the amendment of the two pieces of legislation would really elevate the significance of water as a life-sustaining resource, and that would also highlight that the Department needed capacity to deliver.

The Minister assured the Members that there was hope. Already, there had been results, as shown in the evolution of the Department and the improvement of audit outcomes. There was no justification for qualified audit outcomes, because there was an administration and people were employed to perform these duties.

The Deputy Minister added that although at this stage the Ministerial team had visited three provinces, it intended to go to all provinces, including Mzimvubu, to check the reality of how people were living in relation to water. She agreed that what was needed urgently was proper oversight over municipalities, because they were failing national government and the communities they were supposed to serve.

The Minister confirmed that the DWS must provide written responses to all questions.

The meeting was adjourned.

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