Bulk infrastructure: Department of Cooperative Governance briefing

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Cooperative Governance and Traditional Affairs

16 May 2017
Chairperson: Mr N Masondo (ANC)
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Meeting Summary

The Department of Cooperative Governance and Traditional Affairs (COGTA) presented a report on the state of bulk infrastructure in municipalities to the Portfolio Committee. The main findings highlighted serious challenges in the state of the country’s infrastructure for the provision of housing, water, sanitation and electricity. The key issues identified were the shortage of the required skills, inadequate finance and a lack of collaboration to resolve the challenges.

Members raised a concern that Eskom did not have an indigent system to accommodate the poor. However, it was noted that municipalities owed a substantial amount of money to Eskom, and this could be a contributing factor to water and sanitation targets not being achieved. COGTA said it would implement a solution to overcome the misalignment between bulk infrastructure schemes and reticulation through a collaborative arrangement involving seven priority municipalities and six partners to ensure sustainable solutions to electricity supply issues.

Attention was drawn to waste water treatment problems, and COGTA was asked what measures it would implement to address them. It was recommended that it should lower its targets, as it was apparent it could not meet its current ones. Why was maintenance funding not being prioritised? There should be a discussion with Eskom over bringing independent power producers on line. 

Meeting report

Dr Charles Nwaila, Director General, Department of Cooperative Government and Traditional Affairs (COGTA) introduced Mr Timothy Seroka, Chief Director, and Mr Lebohang Tekane, Cabinet and Parliamentary Liaison, who were to present the Report.

Mr Seroka said the presentation would cover the fourth quarter achievements, challenges and solutions. The medium-term strategic framework (MTSF) had five sub-outcomes. It would require financial administration that was sound to ensure members of society had sustainable access to basic services. The Department was coordinating sectors in line with Chapter 7 of the Constitution. The report would describe the achievements of the Department in relation to the targets set out for the past five years.

On average there was R160 billion in medium-term expenditure framework (MTEF) that went to municipalities, R46 billion to direct grants and R8 billion in indirect grants annually. The evidence suggested that this investment was improving access to basic services, but there were still challenges. Between 2014 and December 2016, more households had access to water and sanitation, and 295 179 targeted households (40% of MTSF target) had been provided with subsidies and affordable houses, while 226 459 (30%) of households in informal settlements had improved living conditions. To date, two municipalities had submitted their registered projects and this put them at an advantage for 2018. Three professional service providers had been incorporated, and municipalities had been given support for water and sanitation.

Mr Seroka went on to compare the achievements of the fourth quarter, January to March 2017, against the targets set. Despite the slow progress in eradicating bucket sanitation in rural areas, the target had been met. With regard to the number of municipalities that had improved their audit outcomes, 24% of municipalities had received qualified audits against the 20% target, and 62% of municipalities had received unqualified audits against the 65% target.

The state of water bulk infrastructure was measured through the ‘Blue Drop’ status of the water purification plants. This assessment was done by the Department of Water and Sanitation (DWS) as part of their monitoring role. The last assessment was done in 2014. There are 1 036 water supply systems that are managed by water service authorities (WSAs), and these were assessed in terms of the DWS Blue Drop risk rating 1 as follows:

 

  • 23% of the plants had Excellent Process Controller registration and related compliance;
  • There was, however, a 55% decrease in the number of Blue Drop certified systems from 98 in 2012, to 44 in 2014;
  • 275 (26%) of the systems were in the high and critical risk category;
  • Risk levels compromised drinking water provision and quality;
  • The 33.7% recorded for water use and water loss management was of major concern.

 

Similarly the state of sanitation bulk infrastructure is measured through the Green Drop status of the wastewater treatment plants (WWTWs), and is also done by the DWS as part of its monitoring role. The last assessment was done with Blue Drop in 2014. There are 824 waste water treatment works managed by WSAs and were assessed in terms of DWS Green Drop risk rating 1 as follows:

 

  • Only 60 of the 824 (7.3%) treatment works that were assessed were able to achieve a ‘Green Drop’ Status1;
  • 215 (26%) treatment works required urgent attention;
  • A further 259 (31.4%) plants had a high risk of failure;
  • 247 (30%) treatment works received less than 30% Green Drop Certification (GDC) scores in 2014, defined as ‘systems in crisis.’

 

The report dealt with the provincial water supply reliability and serious reliability challenges. When it came to access to water, households in Gauteng and Cape Town had fewer challenges than other households in other provinces. Municipalities were facing a high degree of indigence. Other challenges included the allocation of funds and the misalignment of the water bulk and sanitation bulk infrastructure. A further contributor was the lack of skills amongst operational staff and unprofessionalism amongst the professionals. The bulk services and municipal services experienced added pressure because there was a lot of migration from informal settlements.

The upgrading of the electricity bulk supply had been minimal and had failed to keep up with demand. This had been evident during the load-shedding that was experienced in two years ago. Eskom had adopted the “Transmission Development Plan 2012 to 2021” to highlight its expansion programme. Eskom needed R23 billion to build power stations. The solutions proposed to address the challenges included the creation of a collaborative arrangement involving seven priority municipalities for piloting the programme with six partners. These key partners were the Department of Cooperative Governance (DCoG); the Municipal Infrastructure Support Agent (MISA); the Department of Water and Sanitation (DWS); the Development Bank of Southern Africa (DBSA); National Treasury (NT); and the Members of the Executive Council (MECs) and Premiers’ offices. The solution was looking at a total package to ensure the sustainability of the scheme. This collaborative approach would also include community awareness and public participation.

Discussion

Mr E Mthethwa (ANC) commented on the figures, and suggested that a graph would have served a better purpose because it would have saved Members the effort of calculating. He enquired about the measures the Department was putting in place to solve the waste water treatment challenges. In future, it would be better to get statistics so that Members could focus on individual municipalities.

Mr K Mileham (DA) expressed a number of concerns. The figures in the MTSF showed that it was likely that most targets would be missed. There had been improvement in electricity, but water and sanitation was concerning. If it seemed like most targets would be missed, then the implementation of the targets was a problem and they should be adjusted. The fact that the last Blue and Green drop assessment had been carried out in 2014 was concerning. He asked what was being done about the 26% of water bulk infrastructure that was in a critical condition. Coming up with solutions required not a pilot project, but a national scale assessment. The report encouraged more Independent Power Producers (IPPs) to bring their plants online to add electricity, and a discussion with Eskom would be fruitful. The Department of Energy and Eskom were not mentioned among the six partners forming part of the collaborative arrangement. What did the “total package” referred to entail?

Mr Nwaila responded by suggesting they should invite sector departments in the future, to make the meeting more insightful. Regarding an engagement between IPPs and Eskom, there had been an omission on the slides, but a committee had been delegated to look at energy issues. Last week, there had been a meeting to look at constitutional issues, such as municipalities providing electricity in terms of the constitution, while Eskom did the same. Eskom said they were within their rights to provide electricity, and the constitution did not clarify the grey areas surrounding this issue. If Eskom were to withdraw from providing electricity, there would be major implications. In terms of the debt owed to Eskom by municipalities, there were also water boards that were owed, and this amounted to about R60 million.

Mr Seroka explained the idea of a “total package.” Its main objective was the sustainability of the services that were being provided. The package included funding from various sources, to deal with institutional arrangements. It also dealt with the issue of community involvement in raising awareness for issues of revenue. The Department had experienced budget cuts and was not likely to meet its targets. The issue of figures raised by Mr Mthethwa had been noted. The Department was working with other sectors to improve the Green and Blue drop system.

Mr Nwaila admitted that the Department would not achieve a number of targets. The issue of water was complex, because it required proper infrastructure. For example, the Free State was quite a rocky place and therefore pipes could not be installed. Some solutions, such as the Ventilated Improved Pit (VIP) toilets, had been rejected by the public.

Mr M Bara (DA) said it was very important to engage robustly with Eskom when it came to the distribution of electricity. The people of Soweto had complained that Eskom had no indigent system to deal with the poor, and it was assumed that municipalities would have this kind of system. However, municipalities could not meet their targets and were owed money by the Department. A way for municipalities to make money should be assessed. There was an issue of ageing infrastructure -- what had the Committee done to prioritise infrastructure development?

Mr J Dube (ANC) asked why maintenance funding had not been prioritised, and commented that the lack of skills had a direct effect on communities.

Mr Mileham enquired why it had been mentioned that there was a lack of funding to address the water and sanitation backlog, while the figures showed there was money that was not being spent.

Mr Nwaila said there was a serious challenge with municipalities owing billions to Eskom. The issue of skills was the Department greatest concern. To address this, the Municipal Infrastructure Support Agency (MISA) had a bursary to help hone the skills of students in those areas. MISA was working with all the vulnerable municipalities to try and assist them with skills. The environment may not be conducive for many people and the political area needed to be fixed. Sometimes skills were there, but there was poor governance. Not much was being done about ageing infrastructure. Money was being spent on short-term maintenance, such as on roads and potholes.

Mr Dube said it seemed that the bursaries would solve the skills problem only in the short term.

Mr Seroka said that the Director-General had covered the long-term solutions. MISA was trying to assist the programme on capacity building by being part of the collaborative arrangement. Annually there was a conference that was held to discuss the delivery of services. In between this, there were some short courses that were being provided to the municipal officials to assist them in keeping up with the technology that was required for their jobs. All these factors contributed to consistent capacity building. With the issue of money not being spent, money did circulate between municipalities and when one municipality was not using the money efficiently, it was given to one that would.

The Chairperson concluded the discussions by saying the Committee was committed to finding sustainable solutions. A meeting should be organised with all stakeholders to discuss some of the issues raised.

Committee matters

The Chairperson requested a review of the minutes of the meeting on 21 February 2017.  

Mr Mthethwa said he could not say that he was happy with the minutes, because he had not read them.

The Chairperson asked if the minutes could be adopted.

Mr Mthethwa said he would comment later, before the end of business on Friday.

The Chairperson asked the other Members if they were happy with this. There was silent consent and it was agreed that this approach would be taken.

Mr Mileham said that there was a lot that the Committee had not mentioned. He enquired about the resolutions that had been adopted by the Committee. The reports should be forthcoming before the next meeting.

The Chairperson said that with all these suggestions, it would be wise to look at having meetings more regularly, rather than monthly.

The meeting was adjourned.   

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