The Department of Water and Sanitation (DWS) with the Minister in attendance briefed the Portfolio Committee on Water and Sanitation on its Annual Performance Plan (APP). The Portfolio Committee Meeting on Water and Sanitation was divided into three parts. The Committee was meant to have a meeting first with the Auditor-General (AG). It is normal practice that before the Committee is briefed by DWS; the AG would have taken the Committee through critical areas of concern. That meeting has been postponed because the AG is not available this morning, together with National Treasury.
The reasons for the Committee taking the route to do a forensic investigation were briefly discussed. It was highlighted that the terms of reference for the inquiry have been finalised by both committees and only the date when the inquiry is to begin has yet to be finalised.
Among the key concerns raised by the Committee were that the Minister gives the Committee the assurances that the drivers of the budget are credible drivers. Furthermore, when it prepares for the meeting, the Committee must be able to see if the DWS’s strategic plan is in line with the National Development Plan (NDP).
The Minister said the structure of the report is important because without ensuring the alignment of the Department’s reporting to the outcomes system of government, DWS will never be on top of managing the finances because the outcomes are very specific i.e. where is the money spent, for what, and how is the money spent, what is the output, what is the impact in terms of unemployment, inequality and poverty. Part of the challenge was that DWS owes a lot of money to its own institutions, namely, the water boards. This means that the Department needs to be conscious, even as it deals with this report, how that will impact upon the budget going forward. Therefore, after the budget vote on 22 May, DWS may have to go back to the APP and amend it. By then, the Minister will have a much better understanding of what is available for the 2018/19 financial year. The APP has to be dealt with quite cautiously going forward.
According to the Department, DWS’s vision going forward, the 5 Key Strategic Pillars are as follows: the National Water Resources and Services Authority (Pillar One); the National Water Resources and Services Regulator (Pillar Two); the Water Resources and Services Value Chain (Pillar Three); a Water Resources and Services Master Plan (Pillar Four); and Institutional Rationalisation and Organisational Alignment (Pillar Five). The second part of the presentation detailed the key programmes and focus areas (i.e. performance indicators) including the associated budget allocations. The Department gave a strategic overview; and overview of performance information; an analysis of the adequacy of financial resources for the implementation of plans (Vote 36); and an overview of the Water Trading Entity (WTE) medium term budget. Inter alia, DWS stipulated the areas of shortfalls. These areas are Giyani Water Services, Butterworth Emergency; Maintenance of Infrastructure (e.g. War on Leaks); accruals; outstanding transfers to municipalities and waterboards; funds to be surrendered to National Treasury; and a bank overdraft. The total confirmed shortfall is R1.5 billion with a total additional projected shortfall of approximately R1.5 billion; bring the total shortfall to just over R billion.
DWS disaggregated the sources of revenue stemming from augmentation and exchange revenue (see slides 51 and 52), which amounts to R11.2 billion. Furthermore, the total budget allocated based on the budget allocation breakdown is R10.4 billion.
Committee had some tough questions for the Department and the Minister. These questions focused mostly on the budget of DSW; the integrity of departmental official when dealing with public funds; accountability; outsourcing; technological advances; and capacity.
In light of the absence of the Chairperson, Mr H Chauke (ANC) was nominated by the Committee as Acting Chairperson.
The Acting Chairperson welcomed everyone and said the Committee was meant to have a meeting earlier with the Auditor-General (AG). It is normal practice that before the Committee is briefed by the DWS, the AG would have taken the Committee through critical areas of concern; areas in relation to which the DWS would need to focus all its energy on. That meeting has been postponed because the AG is not available this morning together with National Treasury. All present are aware that there have been quite a number of challenges with regards to the manner in which DWS has been spending money, hence the involvement of National Treasury to clarify certain areas that the Committee has been concerned about. That process will have to be fixed next week.
He told the Minister that the general concern of the Committee is that it was not happy about the last budget, how it was spent and where DWS is now. The Committee is also not happy that the very same people who mismanaged the budget of DWS are the ones who are still going to manage the coming budget. After or before the budget vote, the Committee would like a serious change. The Committee will not allow a situation where DWS only reaches 28% of its target, but used the entire budget. It is a serious concern and this is why the Committee has taken the route to do a forensic investigation. The terms of reference for the inquiry has been finalised by both Committees of Public Accounts. Only the date when the inquiry is to begin has yet to be finalised. The team that has been established of joint committees, namely, of Public Accounts and Water and Sanitation, are busy extracting information from different documents to begin to identify weaknesses that are going to be called upon to investigate or to give information to the Committee. DWS has had a number of engagements with the Special Investigating Unit (SIU) and there is a report that was published. In the next engagement, the National Prosecuting Authority (NPA) and the Hawks will appear before the Committee to deal with matters that have been referred as there is no action that has been taken so far. This is the context in which the Committee is being briefed on the budget. The Committee had to resort to an inquiry because of the manner in which the budget of DWS has been managed. There are several violent incidences which demonstrate that communities are fighting over water (e.g. North West). A meeting is taking place tomorrow to adopt the programme for the inquiry. The Minister will now be given an opportunity to present the DWS’s strategic plan. It is important for the Minister to note that the Committee needs his assurances that the drivers of the budget are credible drivers. The Committee may like to make certain recommendations as to how what is the way forward.
The Minister thanked the Committee for the comments. On the Department’s work, he said the structure of the report is important because without ensuring the alignment of the Department’s reporting to the outcomes system of government, DWS will never be on top of managing the finances because the outcomes are very specific i.e. where is the money spent, for what, and how is the money spent, what is the output, what is the impact in terms of unemployment, inequality and poverty. When the APP is costed, it is costed against nothing. This is something that has been discussed with the team. The DG and the critical DDGs of the DWS are working to align the reporting of DWS to outcomes. Without doing so, it will become very difficult for oversight to be effective, especially from the perspective of the Committee. DWS cannot explain what it spent its money on and why government does have a system according to which every cent is supposed to be spent in terms of the outcomes that have been set out. The Department is being equipped to report on matters that can be traced back to where the money is said to have been spent. Secondly, if the organisation is poorly set out, the DWS will not have systems that are effective. The organisation will not be managed. DWS has started this process to ensure that it is known who is accountable and responsible for what. If this is not the case, it is very difficult to pinpoint some of the things that somebody is supposed to be accountable for. DWS has started this process over the last couple of weeks and it will soon be very clear who is responsible for what. Lastly, part of the challenge that is coming through is that DWS owes a lot of money to its own institutions, namely, the water boards. This means that the Department needs to be conscious, even as it deals with this report, needs to know how much money it owes whom, and how that will impact upon the budget going forward. Therefore, after the budget vote on 22 May, DWS may have to go back to the APP and amend it. By then, the Minister will have a much better understanding of what is available for the 2018/19 financial year. The APP has to be dealt with quite cautiously going forward. In terms of the 28% the Chairperson spoke about, most of the time and because the APP precedes the budget, what is written in the APP when the budget is presented might not speak to what is in the APP and there is no review of the APP to align it to the budget. It is for this reasons that, after the budget speech, tDWS may have to go back to the APP and amend it so that the DWS does not have spending of 90% and outcomes that are in the range of 20% and 29%. The alignment speaks to the system itself rather than to what in fact has been a failure. This is what the DWS has been working on.
The Acting Chairperson said, based on what the Minister has raised; there is a number of areas that will need to be clearly presented, one such area being the accrual vis-à-vis the current budget. There has been a revision on the APP on the War on Leaks of which the Committee would like a detailed breakdown of the budgeting of that particular programme. It was irregular in the last financial year. The money was taken from the second account of the DWS, the Water Trading Entity (WTE). There is a very serious concern around that particular account s it seems as if it is money that can just be spent ‘willy-nilly.’ Based on the Minister’s comments, the DWS owes water boards a lot of money. The Committee will need to be given a clear breakdown of the monies that are owed to these waterboards. When the DG presents, a clear breakdown from the grants vis-à-vis the direct allocation is needed. With regards to the Minister’s comments concerning the changing of the APP, a situation is envisaged where the DWS will come back again. The Minister speaks of reorganising and refocusing the DWS such that there is proper accountability. The biggest problem that the DWS has had is that, when dealing with questions of accountability, line functions are not clearly defined. The Committee wants accountability.
Mr L Basson (DA) commented that the Minister puts the Committee in a difficult situation. There is no money for any development in the current financial year. The main reason is because of, as per the report of the DWS, the shortfall of R4.5 billion. However, National Treasury or the Reserve Bank take the shortfall to nearly R6 billion or R7 billion. How can the Committee view this matter if the Minister says he does not know and the Committee still does not know what the DWS owes the water boards? At the end of March, accruals were R609 million. It is now increased to R1.025 billion. What else does the Committee not know? Why then should it deal with this matter if the Minister is not certain as to whether the figures are correct? The Committee should reconsider taking the document as a true reflection because the Minister has already indicated that there are still amounts that have to add up and that he does not know what is going to be left within the DWS. The Chairperson is correct in saying that the people who caused the collapse in the previous financial year are going to have the same effect on the new financial year. It is just a knock-on effect. Unfortunately for the Minister, he came in to take over a bankrupt department. It does not seem as if the DWS will get a bail out because this is not a once-off issue, it is continuing year after year.
The Acting Chairperson reminded everyone that the last time that the APP was addressed; itwas the first time that the Minister came across the document. Again, it had not disclosed in detail the accruals that are owed to a number of water boards and the Minister still had to go through the information.
The Chairperson Mr M Johnson (ANC) joined the meeting.
Mr D Mnguni (ANC) explained that thorough preparation has to go into any meeting so as to ensure that whatever is imparted to the participants is well-researched. The Committee cannot hold people accountable if it is not prepared. He said he had just received the documents and was expecting to receive them prior so that he can prepare adequately. There are NDP strategies that have to be achieved. When it prepares for the meeting, the Committee must be able to see if the DWS’s strategic plan is in line with the NDP. It is concerning that the Committee has received the APP only now. On accruals, there are targets DWS has not met last year and the year before. In the current presentation, will there be ‘smart’ targets so that DWS can meet them? Who are the ones who set the targets? If it is DWS, why does it not meet them, given that the Department is not even half-way in meeting some of the targets? Given the DWS’s budgetary constraints, are these plans reliable, achievable, simple and smart?
Mr Chauke said the Committee will have to get an assurance from DWS whether, in light of the current information that has been presented to the Committee, there are any amendments in the current document that has been submitted. Did the DG brief the new Minister to prepare him for the current meeting so that the information which the Minister presents he has gone through and is satisfied with? From the perspective of the Committee, DWS is bankrupt. The Committee may want to consider calling for section 100 so that DWS can be placed under administration. The point is that the current people that have caused the Department not to meet its targets are still the ones who are expected to implement the budget. This does not make sense. This is public money that needs to be respected. The Committee will not pass the budget for its own sake. It has to be convinced somehow.
The Chairperson highlighted that the State has an obligation to provide a very important service to the people of South Africa. It is a basic service. He read from Section 27 of the Constitution, which speaks to, among others, the right to water. DWS talks about water being life. Based on Section 27 of the Constitution, water is a basic right that cannot be compromised. Once that right is compromised, the very foundation of South Africa’s democracy is compromised. There is no other option to ensure that the right to water is fulfilled. As Members of Parliament and the Executive, all have to find themselves geared towards fulfilling that right. This is what unites us, namely, that a better life for the people of South Africa be ensured. What brings everyone here together is that assurance and contract with the people of South Africa, who are the supervisors of government.
The Minister acknowledges the concerns of the Committee but it is important not to be locked too much in the past, explaining that he is presenting himself to the Committee in honesty to present the road and strategic direction which the DWS will be taking. It will correct all those issues that are cause for desperation when one looks at DWS. DWS is despairingly aware of the problem that sits before it. It is in need of the support and understanding of the Committee in terms of the difficult situation that the DWS finds itself in, which must not be exacerbated but corrected. DWS must try to do the best it can to sweep the floor in terms of the debt that is there and then try to move forward and come up with something that is credible that will meet all the requirements of the mandate of the Department. The decision to have an inquiry is welcome. The inquiry must do its work. The Minister will also do his work to correct the problems in DWS. As per the five strategic pillars, the starting point is addressing the structure of the organisation. The strategic pillars are geared towards improving accountability. When DWS returns to the Committee in August, that which is not in line with the budget will be reviewed. This Saturday, the Minister will be going to Clanwilliam. This is only one example in that he would like to see things for himself and report back to his leaders confidently. The Committee must please accept the Minister’s bon fides. The DWS’s current team are all Acting DDGs. How does one work with this? This is why the Department has to be properly structured so that when the Committee has to be reported to, the Minister knows exactly who will present. The current DG has no support system. It is important to move forward and based on the outcome of the inquiry, whoever has done something wrong must take accountability. It is important for everyone to have hope.
DWS 2018/19 to 2020/21 Annual Performance Plan
Mr Sifiso Mkhize, Acting Director-General, DWS, started by looking at alignment to international and government programmes, listing the various outcomes and strategic objectives in view of which DWS’s APP and budget (see slide 4)..
DWS is implementing the proposed structure immediately so that they can speak to the outcomes alluded to in the presentation. It entails:
-Planning, Monitoring and Evaluation
-Infrastructure Build and Maintenance (e.g. War on Leaks)
-Water and Sanitation Services Reform and Regulation
-Corporate Support Services
-Financial Management Services
Mr Mkhize said currently there is no structure that supports the DG. As part of the reform, DWS has written to the Department of Public Service and Administration (DPSA) on looking at the structure for the creation of a Chief Operations Officer, that will deal with the issues regarding administration and issues that are operational in nature. Coupled with that, the office is also being capacitated in terms of reporting, how reports are done, planning, how the planning is done, as well as implementation.
DWS’s vision going forward, i.e. the 5 Key Strategic Pillars is as follows: the National Water Resources and Services Authority (i); the National Water Resources and Services Regulator (ii); the Water Resources and Services Value Chain (iii); a Water Resources and Services Master Plan (iv); and the Institutional Rationalisation and Organisational Alignment (v).
As the current Minister came into office at the end of the last financial year, he will need time to look into the APP which the DWS currently has. There is also a timing issue when the process of the APP as started, the approval thereof and the time he has to do the budget speech in the Cabinet. His budget speech needs to be in line with what the DWS has in the APP. Hence, the Minister spoke about, after presenting the budget, there might be a need to come back and revisit the APP and look at how DWS is going to perform going forward and, in terms of reporting on the progress. DWS did provide a detailed outcome based reporting template and the template details where the projects are, how much is budgeted for, and what impacts will be made, either economically or socially. Going forward, the DWS’s report will be based on the outcome reporting and the five outcomes which the DWS contributes to, to which all the DWS’s projects will be linked.
Mr Chauke appreciated the presentation. It was hoped that the DG will be able to talk to the Committee more precisely regarding the timelines. The Committee can only perform its oversight function based on clear information. Given DWS’s stated intention to amend this plan, when will this come to pass and what are the material areas which the DWS will focus on when it amends the strategic plan? The Committee requires a clear timeline on this intervention that the Minister has introduced so that the Committee can expect it at a particular time as the Committee and make a follow-up. The Committee can give support to the Minister when it has a clear plan of implementation.
The Chairperson recommended that the Department finish the presentation and then address Mr Chauke’s concerns. .
Overview of the APP for 2018/19: Vote 36
Mr Trevor Balzer, Deputy Director-General, DWS, gave a breakdown of the performance environment in which the DWS operates, with particular reference to the ground water level trends (slide 9), the operations of water resource systems (see slide 10), the national water balance (slides 11-13), number of registered dams (see slide 14), and the distribution according to size class (slide 15).
He presented the total posts per branch that are filled (total: 5803) and those that are vacant (total: 1016), which an overall vacancy rate of 14.9%. Representation in the senior management structure by race is as follows: Coloured (3.3%), White (10.5%), African (79.5%) and Indian (6.6%).The representation in the senior management structure by gender is as follows: Male (54%) and Female (46%).
Programme 1: Administration (see slides 26-27)
Mr Balzer gave a breakdown of the strategic objectives and the focus areas of the Administration programme. The strategic objectives are as follows: targeted procurement that supports black entrepreneurs in the sector; an efficient, effective and high performing organisation; coordinated development of the skills pool across the sector; targeted and sustained African and Global cooperation in support of the national water and sanitation agenda; and informed and empowered communities and responsive government securing integrated and sustainable partnerships to support the water and sanitation development agenda
Programme 2: Water Planning and Information Management
Mr Balzer eluciadated the strategic objectives and the focus areas of the Water Planning and Information Management programme. The strategic objectives are as follows: enhanced management of water and sanitation information; the integrity of freshwater ecosystems protected; enhanced water use efficiency and management of water quantity; a coordinated approach to water and sanitation infrastructure planning and monitoring and evaluation; targeted and aligned planning for adequate water availability and the enhanced provision of water supply and sanitation services; and an enabling environment for the management of water resources and the provision of basic water and sanitation services across the sector
Programme 3: Water Infrastructure development
The strategic objectives are as follows: adequate water availability and enhanced provision of sustainable and reliable water supply and sanitation services; safe, reliable and sustainable water supply and water and sanitation services infrastructure, including for excluded and vulnerable groups; enhanced provision of sustainable and dignified basic sanitation; targeted rural development initiatives that support smallholder farmers; and job opportunities created that expand economic opportunities for historically excluded and vulnerable groups.
Programme 4: Water Sector Regulation
Mr Balzer gave an analysis of the strategic objectives and the focus areas of the Water Sector Regulation programme. The strategic objectives are as follows: water resources protected through water supply and sanitation services regulation, compliance monitoring and enforcement; freshwater eco-systems protected from Acid Mine Drainage (AMD); equitable water allocation and availability for socio-economic development; and sound governance and oversight of DWS public entities.
Areas with budget shortfalls
Mr Balzer stipulated the areas of shortfalls. These areas are Giyani Water Services, Butterworth Emergency; Maintenance of Infrastructure (e.g. War on Leaks); accruals; outstanding transfers to municipalities and waterboards; funds to be surrendered to National Treasury; and a bank overdraft. The total confirmed shortfall is R1 575 408 000; the total additional projected shorfall is R1 507 292 000; therefore, there is a total shortfall of R3 082 700 000 in the 2018/19 financial year.
The Department has to find a minimum amount of R1.5 billion of the confirmed shortfall from the current budget. The Department has a budget of R15.5 billion for the 2018/19 financial year. Of this amount, the amounts that are exclusively appropriated and cannot be used for anything else are R10.9 billion, comprised of salaries (R1.7 billion); transfers to municipalities (R5.4 billion); transfers to water boards and KOBWA (R903 million); WTE augmentation (R2.2 billion); and earmarked funds for the Buckets Eradication Programme (BEP at R608million.
Water Trading Entity
Mr Balzer disaggregated the sources of revenue 2018/19, stemming from augmentation and exchange revenue (see slides 51 and 52), which amounts to R11.2 billion. Furthermore, the total budget allocated based on the budget allocation breakdown is R10.4 billion.
Infrastructure projects – 2018 / 19
Mr Balzer gave a breakdown of and budgeted expenditure for all the infrastructure projects which will occupy the DWS for the 2018/19, 2019/20, and 2020/21 financial years (see slide 53). For example, the Olifants River water resources development project (phase 2A) has been allocated R10 million for the 2018/19 financial year; the Raising of Clanwilliam Dam has been allocated R331 million and R377 million, respectively, for the 2019/20 and 2020/21 financial years; and the Mokolo and Crocodile Water Augmentation Project (Phase 2A) has been allocated R142 million; R181 million and R265 million for the 2018/19, 2019/20 and the 2020/21 financial years respectively.
Mr Balzer clarified that the WTE budgeted to spend R748 million less than the expected revenue in order to reduce the overdraft. The WTE has written to National Treasury to request that the overdraft be decreased by another R748 million during 2018/19 .
The Chairperson pointed out that Mr Balzer did not say anything about irrigation boards.
Mr Balzer responded that the water use associations / irrigation boards in terms of the institution fabric are in excess of 250. There are a huge number of entities which double in the Water Sector.
The Chairperson highlighted that a number of issues have been raised. What is the fundamental difference between ‘water loss’ and ‘non-revenue water’? While these two categories are interchangeable, there is a serious insistence on the part of the DWS to draw a line between the two. The only question is what, in the next 2018/19 financial year, would be the three things the DWS would want to achieve that are going to change the lives of the South African people for the better and advance South Africa’s revolution going forward?
Mr Basson, on BEP, pointed out that in one of the meetings last year, or early this year, the Committee asked the previous Minister whether the DWS should not transfer bucket eradication to COGTA. It is a function of COGTA to provide services in municipalities. The Minister should think about it and negotiate if he thinks that the Committee’s statement is correct. Secondly, on WTE, there is an expected R11.2 billion income. What was the income the previous financial for WTE? Is this amount some percentage higher? The R5.2 million of TCTA payments is this only in respect of financial year 2018/19 or does this include the outstanding amount that is still owed to the TCTA from the previous financial year? How will the DWS finance this? Concerning the surplus of R748 million which will go towards reducing the overdraft as at 31 March 2018, what if the DWS does not collect R11.2 billion? It is not as if the DWS has a budget that it can work with. The DWS assumes that it will get R11.2 billion and then, what is left will be paid. Therefore, the Department has not budgeted to pay the overdraft of R2 billion. What is owed to the water boards is also not reflected in the presentation. Why is this? Out of what programme does the R486 million that is to be surrendered to National Treasury come? Why is these funds not utilised to towards the overdraft?
Mr Chauke asked who is going to implement this programme differently from the last time. Can the Committee be assured that the funds that will be passed by Parliament to the DWS will be in good hands? If this point is not answered, the DWS will find itself it the same position in the next financial year.
Ms M Khawula (EFF) thanked the Chairperson and Mr Chauke. What does the term ‘infrastructure’ mean? Why are we being brainwashed? The delegates need to remember that they are not officials who have been employed by the government. The Committee has been voted for by the community members to represent them in Parliament for service delivery or for what they want government to do for them. There is no use for the APP. It is still going to be the same as it was before. You still want us to give funds to the same people who failed to use it appropriately. They dismally failed to develop the infrastructure for the community. The Committee is supposed to be seeing new faces. The ones that are being spoken about failed to do their job to help the masses down there. To the Minister, who said the Committee should not dwell on the past, the Committee is watching him and taking note of his words. There is a high level of corruptive activity that is taking place in the DWS which makes it difficult to sign off on the budget once it comes. Ms Khawula said that she has no hope in the Minister as he seems to be part of the same group of people who failed to work in a manner expected of them.
Mr Mnguni commented that, based on the Minister’s vision of the DWS, there was hope that at least something is being done, although the Committee will be waiting for the Minister and the senior management to present to the Committee as to how they intend to move DWS forward based on the strategic framework that has just been presented. However, there are still various challenges. There are people in DWS that are very immovable in terms of the way they think. This requires the Minister’s visionary leadership to ensure that these plans are carried out with or without them. The Committee wants service delivery. Politicians are relying on administration to do their duties. If the administrators are not performing, the Committee relies upon the Minister, the leader of the DWS, to drive that car to ensure that if a wheel has been punctured, it must be replaced to ensure that the car continues to move. In the APP, an issue of office accommodation was raised which keeps on escalating. Is the DWS renting its offices? If they are rented, is there anyway DWS can have its own offices so that the Department can scale down on its current expenses? The War on Leaks has been put under a certain programme, but DWS also indicates that there is no budget of R1.2 billion. How is DWS going to deal with this programme, which needs to be ongoing? In terms of the outstanding transfers that were accrued from last year to this year to municipalities and water boards, does the DWS have any plans to address these outstanding transfers of R198 million? Furthermore, why is R486 million being surrendered back to Treasury when DWS owes transfers of R198 million? How can so much money be surrendered to Treasury while DWS still owes transfers to municipalities and waterboards? From which programme did this amount come from? WTE has written to National Treasury to request that the overdraft be decreased by another R748 million during 2018/19 and was meant to have a meeting with Treasury on 20 April. Can the Department share what the agreement was and how did it go. On slide 53 there is a layout of DWS’ infrastructure projects. Why, for certain projects are there no allocations for the 2019/20 and or 2020/21 financial years, for example, the Olifants River water resources development project? Does DWS expect that the project will be completed in the year in which the allocation has been made?
The Chairperson added that his one area of interest relates to a programme that has to do with cleaning of rivers. There was some money spent on it in the past financial year, but whether there was any result remains a question. Moreover, echoing Mr Mnguni, what are the DWS cost-cutting measures? In discussions, TCTA raised that it may like to go the route of a service provider in appointing a CEO. By way of example, services providers are increasingly used, as cost-cutting measures, for the purpose of appointing or scouting for senior positions in the DWS and its agencies. Is there any such exercise that the DWS may have been involved in? In terms of the DWS’s Green Drop and Blue Drop standards - these are great importance as they relate to the earlier point concerning the caring of rivers. They also talk to the state of affairs of the DWS’s waste water treatment plants. This should form a part of what is referred to as the DWS’s Annual Report. The challenge which the Committee has is that it does not get the results or such reports. Yet, the DWS continues to budget for these activities. The question is whether there is anything that happens in every intervening financial year? The last time that DWS received such a report was in 2014. The importance of such reports cannot be overstated. It really should speak to the heart of the quality of South Africa’s water. Apparently, about 80% of South Africa’s infrastructure in the field of water quality, particularly regarding waste water treatment plants, is not operational, dysfunctional or there are serious challenges. For the Committee to say that, indeed, there was an impact, i.e. there was a major change in the lives of South Africa’s people, the BEP is one goal DWS should have.
Mr Basson clarified that, in terms of DWS’s budget and the Minister’s stated intention to visit the Clanwilliam dam, the DWS’s technical team will inform the Minister that, in front of the dam, there is construction work that needs to be done in the summer months. If DWS only receives the budget for 2019/20, the DWS may find itself in the situation whereby it may not be able to utilise all that money in the financial year in question and maybe conserve a small portion in this financial year so that, whilst the dam is empty, do the construction work that will then allow them to continue when it rains.
Minister Nkwinti explained, concerning the Clanwilliam Dam, that DWS had a very important meeting last week with the Secretariat of the PICC and the New Development Bank. This is an area where they are interested in getting involved. The DWS has already sent a technical team and there will be a meeting on Wednesday. The teams are being put together for this purpose. A technical team constituted of a planner, an engineer and one other technical person from the Water Research Commission (WRC) will link up with the PICC. The Mokolo Augmentation is also critical because that water is linked to the mid construction. In terms of the three goals that DWS would like to achieve, if one looks at the five pillars, infrastructure build and maintenance does not only apply to water infrastructure only, but also to water and sanitation. DWS cannot afford to neglect sanitation. South Africa has lost many young children due to pit latrines. Water is life and sanitation is dignity. One cannot have R608 million for the programme for the BEP when DWS invested R2 billion to R3 billion in other projects which do not touch the lives of the South African people as much. This is an area of priority. In a conversation with an Afrikaans farmer, the farmer suggested to the Minister, who was involved in land reform, to also be involved in water reform. The farmer suggested that, while the government gives people land, what it does not take into account when it gives black people land is that water rights are attached to persons and not to the land. The emerging black farmer is left without water rights. How does one expect that person to thrive as a farmer? It is important to prioritise this issue so that all farmers, black and white, have the same access to water. In relation to the 3 000 hectares water rights in Sundays River Valley in the Eastern Cape, there are only 300 hundred hectares of water rights that are left. What happened to the rest? The black farmers still do not have water. This is why a key goal of DWS is Water Resources and Services Reform. This institutional transformation must occur. DWS hopes to be supported to change the law so that the law does not attach water rights to individuals but to the farm so that whoever takes over the farm has water rights. DWS would like to make progress on the BEP. Among the five pillars is institutional and organisational management and reengineering. This pillar speaks precisely to the concern of the Committee Members that the people who are to be used to implement the Minister’s vision are the same people who caused the collapse of the DWS. The Acting Director-General from the Public Service Commission (PSC) gave a document to the Minister which states that certain DDGs were irregularly appointed. A meeting will be held with the PSC to discuss this matter, even though the document was given to the previous Minister. How and the timeframes in which the DWS intends to deal with this matter was borne in mind when the current structure was drafted. It was also taken into consideration that the DWS already has DDGs and, according to South African law, the DWS has to follow the proper process in terms of dismissals. This has to be acted upon, but in a proper and responsible way so that everyone is protected in terms of South African law.
Mr Chauke agreed with the Minister in terms of the points and concerns which he raised, but also supported the way forward which he has proposed. A point that needs to be understood is that DWS has collapsed. The calibre of the people that are before the Committee are people for whom the Committee must pass the budget for the implementation of DWS plans. The PSC has done some investigation around a number of the DWS’s DDGs. The point is that a number of these DDGs were suspended, who were brought back because charges were never served to them, on serious mismanagement of public funds. The BEP overspent by about R400 million. Yet, the responsible person is back in their office as if it is business as usual. There are other examples. This cannot continue. Somehow, a way must be found to resolve this problem. The Committee feels very strongly that some of the DWS’s officials cannot be trusted with public money. The Committee will work with the Minister and give him support so that these processes can be expedited. From where the Committee is sitting, DWS will find itself in the same position in the next financial year, namely, another collapse, if the Committee does not give support and share with the Minister the views that the Committee has. There is going to be a new chairman that, after this engagement, will sit again with the Minister and look at the capacity of the DWS in line with the plan that the Minister is proposing and put up clear timelines and give the necessary support for the Minister to achieve these plans. Without proper planning, the capacity of implementing the Minister’s plans is zero. The Committee’s plea is, in light of the programme and the allocated budget, the process of appointing the right people for the right positions needs to start. This is what is important. There are serious concerns for the Committee in passing a budget when the DWS is in a state of collapse. How soon can the Minister move with this plan to help achieve what the Minister has said he wants to achieve? Furthermore, the fundamental concerns around attaching water rights to individuals and not to the farm, has been raised with the DWS numerous times, yet, till today, not a single piece of legislation has been brought before the Committee. The capacity in DWS is zero. The Committee is passionate about seeing the DWS achieve what it wants to achieve. At the end of the day, there is not much time for the Committee to make a follow-up on the issues that has been commented on. The three points of which the Chairperson spoke will only be achieved with the requisite capacity, which DWS does not have.
Mr Paul Nel, Acting Chief Financial Officer, DWS, concerning the previous year’s sales and the current year budget, responded that in 2017/18, the DWS total billings were R11.8 billion. However, it is known that there is a culture of non-payment in municipalities. Municipal debt increased by R1.2 billion in that financial year. In the past, the trend has been for, whatever it bills, to be getting in 89.5%. So in the DWS’s budget, the DWS decided that it can only bank on getting 90% from the sale of the exchange revenue. DWS had a meeting with National Treasury in November 2017 where National Treasury came and spoke about the overdraft and the repayment of the overdraft where they opened the door for DWS to renegotiate the repayment. Immediately after the meeting, DWS contacted National Treasury to renegotiate. National Treasury said that DWS first needs to show to that it was going to repay it for the first year. DWS made its target for the year and in March contacted National Treasury to say that it would like to spread the repayments over three years. National Treasury responded by requesting the meeting on 20 April. At the meeting DWS went one step further and said the overdraft should be left altogether at present and for that money rather to be channelled into TCTA, which is a priority at the moment in light of the R8 billion repayment that TCTA has to make. The options were to either repay over three years or take the money and channel it to TCTA. National Treasury said that it would have internal meetings and get back to the DWS on which option they will accept or if they have another option in mind. DWS is of the view that the TCTA has to be bailed out. In the DWS budget, there is no money. It will not be able to come up with R2.5 billion for that money. Preferably, it must be channelled through the debt from through the municipalities to try to repay the debt somehow, which is R11.2 billion. The projects on slide 53, the first three projects, will be completed this year. After this year, there will be no more capital costs, but there will be operations and maintenance.
Ms Zandile Mathe, Deputy Director-General, DWS, explained that the De Hoop Dam (phase 2A) was reported on to the Committee 2 or 3 years ago that the project was completed, i.e. the construction of the dam, but the lift/scooper was still outstanding. Hence DWS still has a budget for this project. The Department has been grappling with mechanical experts in DWS that could put up a scoop. The specs are not responsive to what the industry norms require. It may be important to approach the Centre for Scientific and Industrial Research CSIR (CSIR) for assistance in putting up the specs. The person who has been working on the leaks of the dams is very old and is still using outdated technology. The dam, however, is operational. There is an impasse between DWS and the mining houses who repudiated from the initial agreement. This matter has been raised with the DWS’s principle and the Department is hoping to engage mining houses perhaps at the Chamber level. They have also responded to DWS in terms of what must be done in order for the project to succeed.
Ms Mbali Manukuza, Acting CFO, DWS, on the R486 million under spending, said this amount has not yet been paid back to National Treasury. It is tDWS’s under spending for the 2017/18 financial year, subject to the audit. Only after 31 July, when the AGSA has audited the figures, it will have to pay it in 2018/19 after August. The expectation is that since there is an under spending of R486 million there is supposed to be cash in the bank to enable the DWS to pay the money back to National Treasury. This is not the case. This is why DWS has put it as a shortfall. DWS has an under spending of R486 million but this amount was not in the bank. The DWS closed with an overdraft of R134 million in the bank. The discrepancy of approximately R600 million was caused by payments not necessarily linked to the APP. In the 2016/17 financial year, DWS closed with unauthorised expenditure of R406 million. This had to be paid back in the 2017/18 financial year and it was not budgeted for. By the same token, DWS closed with an overdraft of R193 million in the 2016/17 financial year and again had to pay it now in the current financial year. In addition, DWS paid for Mzimvubu about R124 million on behalf of WTE. There are several payments which DWS did that used up the cash that was in the bank and, therefore, caused an overdraft of R134 million, although DWS is under spending. This is why the accruals are sitting at about R1 billion because of the money that was budgeted for under infrastructure, but because there was no physical cash in the bank, payments could not take place. DWS could not pay the invoices for the infrastructure. Furthermore, concerning from what specific programme the R486 million originates, R599 million comes from infrastructure, which was largely effected because the money was used for other causes. There was also R149 million from planning in Programme Two. There was another R86 million from regulations. These figures, however, were then offset by R348 million overspending in Programme One. When DWS finalised the figures for the current year, there was unauthorised expenditure stemming from Programme One to the tune of approximately R348 million because of the DWS’s War on Leaks Programme that was also paid for without a budget and also from Programme Three of about R200 million coming from the BEP. These overspendings have offset the under spending in the other programmes. The net under spending is the R486 million. However, what needs to be highlighted is that the figures may change in terms of how much is coming from which programme after approval from Treasury once DWS submits the financial statements on 31 May. However, now in April 2018, DWS has since paid about R156 million of those transfers and only about R42 million is yet to be paid to the municipality.
Mr Marius Keet, Senior Manager, DWS, in response to concerns raised of the water quality in rivers in terms of the Blue and Green Drop standards, highlighted that there was a challenge in DWS that management of water quality is spread over a couple of units and between different branches. This situation posed challenged in that there were too many people working in this area who tend to work in silos. DWS appointed consultants to formulate a water quality strategy. The strategy was approved and will be submitted to top management. The idea is to bring the management of water quality under one unit. This will improve the situation. The draft structure on the proposed way forward already has water quality under one unit.
The Chairperson asked whether this proposal relates to the three consultants which has been reference to have a budget of R55 million?
Mr Keet responded that he is referring to another matter and the fee for consultants was about R8 million to R9 million for the study. On the monitoring the water quality of rivers, he said there was a big problem in DWS in terms of procurement of lab services. The Department is almost finished with this and will soon get appointments of lab services for the different provinces. The different provinces can appoint their own consultants or their own labs. This will improve the monitoring. For some time, the DWS did not even monitor the rivers; this situation was a challenge but will improve now.
Ms Thoko Sigwaza, Deputy Director-General: Regulation, DWS referred to page 43 of the APP on river monitoring and cleaning, and explained that this is an exercise that is undertaken at a local level mainly by the catchment management agencies where they exist and, where they do not, by the regional offices. For the past three years, the DWS has done very well and has monitored and cleaned, on average, about 66 rivers a year. This year, in the APP, DWS is aiming to monitor and clean 71 rivers. Based on the capacity that exists in regions, DWS, while aware that there are about 2 000 rivers in South Africa, is monitoring and cleaning about one-third of them. There is room for improvement in terms of the capacity of the Department. In terms of the debt that is owed by municipalities to water boards, by the end of March they were owned about R4.2 billion, of which R1.5 billion was current and R4.2 billion was incurred over a period of 120 days. The key municipalities that are owing are Matjhabeng municipality is owing Sedibeng Water; Emfuleni that is owning Randwater; this has resulted in Sedibeng not paying the WTE owing more than a R1 billion. With regards to Adopt a River, on an annual basis, DWS organises the Adopt a River campaign where communities participate in the cleaning of rivers. This is supposed to be budgeted for under WTE, but due to a limited budget, DWS is now encouraging the communities to volunteer when they do the campaign.
DWS is revisiting this BEP in terms of its locality and how the functions thereof are carried out. Previously it did not receive the right attention, hence, in the allocation of the budget DWS is looking into it and how the organisation will have the capacity to support the BEP. In the main, DWS would like to ensure that it has the right capacity and resources in this financial year so that this problem can be finalised in the 2018/19 financial year. There are a number of cost-cutting measures that DWS is embarking on besides the cost containment proscribed by Treasury where DWS has looked at issues of furniture, travelling, meetings outside DWS, issues of providing lunch, etc. DWS has made some savings in the previous financial year and it continues to tighten its belt in those functions and activities. In Pretoria DWS has offices in different buildings and in terms of its requirements, DWS submits its needs assessment to the Department of Public Works (DPW) and they allocate offices. DWS would like Public Works to find accommodation that would accommodate all its offices under one roof to limit the number of offices. There are about five building close to each other that house the offices of the DWS. If the offices are all under one roof, the Department cuts expenses on a numbers of issues (i.e. security, cleaning, and aircon maintenance). To date, DWS has received a positive response in terms of relocation of the DWS from the current location.
The Chairperson advised that as e DWS pursues the office reconfigurations it may also have to go beyond the DWS’s headquarters. For example, in Port Elizabeth, the DWS has three different offices of Water and Sanitation. In one of the office blocks the DWS’s offices are across the corridor from the Aurecon and those officials are literally seconded to the DWS and “God knows what happens out of such secondment”. The DWS has to move with speed with these processes as they are counterproductive to what the DWS wants to achieve. It is apparently a practise that has been going on for quite some time.
Mr Chauke said that the CFO would have to give the information she has just presented in writing. A timeline may have to be agreed on for when the Committee expects it because it is very valuable information. The War of Leaks programme’ s unfunded mandate was not previously in the APP, but no that it is in the APP can the Committee get a precise breakdown of its budget for War on Leaks and how this budget is found? Secondly, what is the role of local government with regards to the War on Leaks? It is important to get into the detail of the problems that this project is currently faced with. Where does the DWS get this allocation and how much in this financial year is being allocated moving forward in terms of the medium expenditure in the next three years?
Mr Basson commented that a while ago the Committee was informed in writing that DWS could not do the Blue and Green Drop Report because there was no budget available to do it. The Committee needs clarity on the real reason for it? Can the R11.2 billion that was given to the Committee last week be broken down, given that it is R4.2 billion that municipalities owe? Unfortunately, even if the Committee accepts that DWS will receive R11.2 billion, the picture for the WTE is not well. There was also mention of the surplus of R484 million, the DWS still has to find R4.5 billion in this financial year, of which R2.5 billion is for TCTA and if the DWS cannot get an agreement with the Reserve Bank or National Treasury, the DWS will have to pay another R2 billion to them in this financial year. Until the DWS has made another arrangement, this is what the DWS owes them. Does the DWS think that National Treasury will go into agreement with the Department to lend it more money if DWS does not budget for it? DWS has not indicated the outstanding R2.5 billion in its report owed, which the DWS must pay to TCTA. Where will the DWS get that money and how will it be funded? National Treasury or the Reserve Bank will not appreciate the DWS’s offer that it can only pay R748 million if it has a surplus. This needs to be looked into. Furthermore, the Committee still does not know what is owed to the water boards out of the budget that is allocated. The reality is a very different picture from what the Minister has depicted. At least R4.5 billion is unfunded, which the DWS needs to pay in this financial year out of the WTE and it is not funded. The Committee does not know whether this is still a problem in this financial year. There is no way in this world that the R2.5 billion cannot be paid to the WTE. Otherwise, they will call up the guarantees and Treasury would have to pay them. This will have a huge impact on the rating of the WTE. Furthermore, if DWS does not budget for the payback on the overdraft, how will it be granted if the DWS cannot show how it will be paid by the DWS?
Mr Mnguni echoed the Minister in his concern when land is transferred to a black farmer without water rights. In one of the Committee’s oversight visits, it went to Mpumalanga. The Committee visited one farmer who did not have water. Everything was falling apart. This is only one example. In the presentation, it was indicated that DWS owns 854 dams and the private sector owns 4 657 dams. Farmers in the Western Cape have ‘donated’ water to the communities. Yet, who owns the water? According to the Water Act, the Minister is the custodian of water. Where has that water been that was just released because there is drought in the Western Cape? How are privately-owned dams regulated? Does the DWS even check the capacity they are supposed to have? Are they paying? In 2015, the Chairperson indicated that golf courses are paying a relatively small sum for their water usage? Why does the government expect poor communities, with increasing tariffs, to pay a lot of money? The Committee should speak to the DEA. Fishing is part of the ecosystem. There are many dams with no fish because they are being caught with nets. It is a problem that has to be attended to. Furthermore, there is a need to address the fact that most of the DDGs are ‘acting’.
Ms Khawula commented that separating land from water is very surprising. Since when did DWS know about the problems of water rights black farmers do not have? In relation to the issue in Limpopo with one of the farms, why were the Committee told about this problem? Why is there a high number of vacant posts in the Department? There are enough educated South Africans to fill these posts. There are many universities in South Africa. Is the DWS still waiting for foreigners to come and occupy these posts? Thirdly, the diversion funds to other projects in a little worrying. In Mpumalanga, when the Committee saw waste flowing through other people’s housing, this was very worrying. The Committee would like the DWS to account if it is the custodian of these funds.
The Chairperson said that the budget of DWS has gone down by 5.4%. This speaks to R849 million. The DWS is currently at R15.6 billion. The Committee is always emphasizing that DWS do more with less, given the challenges that attend the introduction of the water budget. The Committee has been informed that many millions have been wasted on Hartes Dam in an attempt to clean the dam, knowing very well what the source of the problem is, namely, the waste water treatment plant in a municipality called Brits Madibeng. When DWS dealt with the problem, it should have dealt with the greater part of the problem that contaminates the dam. However, DWS saw it fit to go straight to the dam and clean it. Yet the problem persists because the waste water treatment plant is not in good capacity. These are things that are very worrisome. The Committee and the Department talk about these things all the time and there is continually an unfavourable response. The Committee would like to help the DWS. None of the Committee Members speak on behalf of a political party to the point that one cannot tell to which parties these members belong to. The only interest that all the Members speak to is that of seeing DWS doing the right thing, that which is supposed to take South Africa forward. Money is spent but when it comes to achieving the target, it is a major issue. DWS is working on a budget which suggests that there has been a gradual reduction. This should serve as a wakeup call for the DWS to spend less but to do more. The Committee speaks about this all the time, but it is business as usual for DWS. It is continually brick and mortar despite the technological advancements that are there. It is understandable, however, as to why the DWS’s officials would see it fit to go the usual old way of doing things with the use of brick and mortar. The site engineer would not have any interest in venturing into a project that is worth R50 million, but rather R500 million or more, because there is value out of that. Departmental officials are pushing these R500 million or more projects so that they also get their own kickbacks. Since the Committee does not see any changes in the culture of DWS, the Committee can only suspect that this must still be the situation. The Committee is keen to see which innovations WRC is bringing. These must be appreciated by the DWS.
Mr Chauke asked, concerning the infrastructure projects between 2018/19, if it is possible for the Committee to get a list of the projects that will be implemented by the construction unit of the DWS, those that will be advertise and why they will be advertised?
Minister Nkwinti explained, regarding the construction unit of the DWS that the Department is going to create a state controlled construction company. The state will own 51%, 31% will be set aside as part of the black industrialists, and 19% will be for investors. The TCTA will be linked to the construction unit. This is the DWS’s priority to meet all the requirements of transformation of water. The exact budget of this project is still to be determined as it is still being designed. But as soon as these are available, it will be presented to the Committee.
Mr Chauke explained when the Minister was still being inaugurated into the DWS, that part of the strife is that the outsourcing of work when the DWS has human resources for construction who are employed, paid every month, but are doing nothing. An important question is whether in the interim - while the reconfiguration and creation of this big body is underway - the rest of the projects will not be allocated to the construction unit? The DWS has a construction unit in the DWS that has not been allocated work, the rest of the work gets advertised outside. It goes to the point of mismanagement and corruption. If there is no work that has been allocated to them now, why is this case? If the DWS has a construction unit, why does it advertise the work that it advertises? The Committee supports the intention of the Minister in relation to the construction unit of DWS that is redundant. These are issues that require some kind of an injection. The DWS has a unit that is there in its capacity, but it is not being used.
Minister Nkwinti explained that the unit is the his priority in terms of construction. The reason why the DWS has as one of its pillars Infrastructure Build and Maintenance is because the DWS has this capacity in the DWS. This is part of the broader plan which is part of what government is instructing the DWS to do. The priority for infrastructure build is going to be that construction unit. The Minister intend to sit together with the water boards and finalise the budget together with them. At 5 o’clock, there is a meeting with Randwater and these issues will be dealt with so that the Minister can speak with confidence.
Mr Mkhize further explained that the meeting with Randwater and Energy and Water SETA, which is to look at the programme in terms of how the DWS can take it forward, in terms of its configuration. Going forward in the 2018/19, it will under programme three under maintenance. In terms of the role of COPTA, the DWS has taken it up to the INTT level, since most of the infrastructure is at municipal level, where the department will work with COPTA in terms of how to implement this project. Previously, the challenge of placement occurred at municipal level mainly related to the capacity of those municipalities. In the main, this project was started in the most distressed municipalities. When one goes to the municipal level, even the capacity to manage these learners to do the placement is not there. Hence, the DWS is working closely with COPTA to ensure that as they finish their classroom learning, when they go for critical learning, there are operations people who will be able to mentor these kids when they go for their experience and training. This project was implemented by Randwater, who are mainly attending to the stipends of learners, and the Energy and Water SETA, which mainly does the teaching and prep management of the learners. This is the purpose of the meeting at 5 o’clock to look at the whole project and the costing thereof so that the DWS can correctly place it in its APP, as the Minister has highlighted. Concerning the vacancies in the DWS, in the last financial years it was reported that the previous Minister had a moratorium in the DWS in terms of the filling of vacancies. In that moratorium, only critical positions were filled. Other positions were waiting for the structural reconfiguration to take place. The Minister has ended the moratorium. The DWS is looking into critical posts and the available funds to fill those critical positions.
Mr Nel explained, concerning the breakdown of the debtor’s book of the WTE, that the total debt in R11.2 billion, of which R2.089 billion relates to companies (Sasal, Eskom, the mines etc.) and individuals (67 000) who owe the DWS. The problem centres mainly on municipalities. They directly owe the DWS R4.2 billion. That is up R521 million over last year. The water boards owe the DWS R3.6 billion. This has also increased b R656 million. The main water board is Sedebeng Water. They own the DWS R2.2 billion. They are owed R2.96 billion by municipalities, of which Matebeng is the biggest culprit owing R2.144 million. The water board owe the DWS, but they are not paying the DWS because of the municipalities. This is why it has gone up R1.282 billion in this year. When it Comes to TCTA, on a monthly basis, the DWS has its TCTA tariff. On a monthly basis, TCTA will ask how much did it build on the DWS’s behalf to that the DWS will give it the exact figure, the actual usage plus the tariffs. R450 million has been used to build and through water users, they bill the DWS exactly the same figure. Whenever the DWS bills, TCTA bills the DWS the same figure. The problem is when the DWS looks at its debtor’s book of R11.2 billion, R4.1 billion relates directly to TCTA, money that the DWS has billed and TCTA expects it to pay them but the DWS has not recovered that R4.1 billion. That is part of the R2.5 billion that the DWS owes TCTA but which the department has not recovered. The DWS has paid the TCTA a lot more than it has recovered. The DWS does not have money to pay the R2.5 billion in its budget. If one looks at the DWS’s budget, there is the TCTA money which has to be paid across anyway and there is the CMA money that goes to the CMAs. All the DWS has is the Operations and Maintenance money. Some of this money is already being used to pay the overdraft. There is no way that the DWS can pay the additional amount to TCTA. That is why the DWS said to Treasury that it needs the assistance. It is directly related to the debt. The R4.1 million is the TCTA debt, which is municipality debt. In the DWS’s budget, it is physically impossible to make provision for that money. This matter has been thrown back to National Treasury. National Treasury could understand the situation. The DWS has presented all the figures and they understand that the DWS will not be able to payback without assistance.
Mr Balzer, concerning the dams and their regulations, responded that the dams that have been presented in terms of the register come out of the DWS’s dam safety register. That is one of the forms of regulation that is applied in terms of the safety of those dams. The DWS does also do oversight with regards to water utilization from the dams as well, which needs to be caveated in that the DWS is not as strong in its regulatory capacity as it should be. This is why reference was made to the exercise which the IGR did down the Breede River. If the DWS is able to do this to a greater extent, where the resources are pooled with the DWS and other regulatory agencies, the DWS would be able to make a greater impact on the application of the licence conditions for water use. The DWS will look at this and see if it can use it as a benchmark to see how it will move forward in improving its regulation. With regards to the release of water, the water that was released by the Western Cape farmer was the outcome of an extensive negotiation process by the DWS with the farmers in the Brede River Catchment. There was water that was not going to be used during the season. That water was then surrendered and transferred across into the Berg River Catchment. The DWS was part of that engagement with the farmers to release the water. It was not released for any particular individual but surrendered into the system and pumped back into the Berg River system.
By way of conclusion, the Chairperson highlighted that the DWS answered most of the questions, but there were a few that were not responded to. Can those questions which were not responded to be raised briefly.
Mr Chauke, concerning the War on Leaks, asked whether the DWS can give a clear breakdown? Secondly, concerning the information that the DWS is in possession of but is not sharing, can the DWS, for instance, share the case it made to Treasury? Can the Committee get that information within 7 days? Thirdly, the acting CFO made an input which very detailed and the Committee does not have this information. Can this body of information also be submitted for the Committee to understand where it is standing?
Mr Basson highlighted that he has a lot of sympathy for the WTE on outstanding amounts and they must juggle around with money to pay. This should be treated as an urgent matter and the Minister ought to deal with this on Cabinet level. The amounts that are owed and which the DWS cannot finance is snowballing. This can be dealt with at another level since COPTA has to deal with municipalities. Water cannot be cut off, it has to be supplied and the DWS has arrangements via TCTA that have to be honoured. Yet, from the side of COPTA, there is no support. Two meetings concerning this issue have been had with COPTA. It is not helping the DWS in any respect.
The Chairperson asked for feedback from the DWS concerning these questions by next week and Wednesday.
Minister Nkwinti explained that reason for the meeting today with Randwater is because today there was supposed to be a march by students to the DWS, to Randwater and the Union Buildings. The perception is that the DWS has transferred money of R78 million to Randwater for purposes of stipends. Mhlathuze Water will no longer transfer the third phase to Mtlauzi. Mhlathuze Water is not in a good shape at the moment. The DWS retains it with Randwater. Today the DWS is meeting with Randwater and Mhlathuze Water because both of them are owed money and the discussion will revolve around how this matter is to be taken forward so that the third phase can be implemented. Part of what the DWS would like to do is understand where they come from, namely, which municipalities. The DWS would like them to be linked to municipalities. There are about 10 000 of these young people. Some money was transferred today by the accounting officer to try and settle this problem. Furthermore, the acting DG said there is infrastructure build and maintenance, saying that is where the DWS will locate the War on Leaks because the DWS would like them to maintain the infrastructure that have been built in the various municipalities. In terms of the allocation in this financial year, the DWS will look into that when the details of that allocation under infrastructure build and maintenance is determined.
The Chairperson asked for written responses to the rest of the questions by next week, Monday.
The meeting was adjourned.
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