Free State COGTA on interventions in municipalities, water and electricity challenges and support provided to Maluti-A-Phofung Local Municipality; with Minister

Meeting report

The Chairperson welcomed all the Members present and accepted an apology from the Maluti-A-Phofung (MAP) Mayor, who could not attend due to health reasons. He also welcomed Minister Lindiwe Sisulu, and thanked her for honouring the Committee's invitation.

Maluti-A-Phofung Local Municipality Interventions

Mr Mpolai Ramulondi, Acting Chief Executive (CEO): MAP Water, briefed the Committee on the measures being implemented to mitigate the effects of the water crisis in Qwaqwa, the constraints being faced by the MAP municipality to resolve the water crisis caused by the drought, and the current plans in place to avoid water shortages in the municipality.

On the water supply system challenges, the Committee learned that the water treatment plants were not linked, and if one failed, the other system could not augment the other. He pointed out that other villages in Qwaqwa did not have access to water due to a lack of reticulation infrastructure.

The Members were briefed that vandalism and theft of water treatment plant equipment was high, and that wastewater treatment plants were dysfunctional and contributed to pollution of water resources. The CEO said that in MAP there was a lack of maintenance of water and sanitation infrastructure, which les to poor water quality. The current dam levels in MAP were Sterkfontein 92%, Makwane 82% and Fika Patso 32%.

The Members were also briefed on the interventions which the Department had put in place to address the water challenges. These were the Regional Bulk Infrastructure Grant (RBIG) and the Water Services Infrastructure Grant (WSIG), both being administered by the Department of Water and Sanitation and benefiting MAP. Under the RBIG, MAP had been allocated a total of R125 million, and under WSIG it had received R110 million.

The CEO advised the Members about the drought intervention projects they were undertaking in MAP. To intervene, the Department had appointed the Sedibeng Water Board as the implementing agent for the drought relief programme at the MAP municipality. They had created three governance structures for the implementation of the relief programme, which were a war room, a stakeholder forum and a steering committee. Furthermore, as a short term relief measure, they had been delivering water to the communities through water tankers, placing JoJo tankers in different places around the communities, and rationing water. Aside from these measures, 136 units of water tanks had been distributed, and the construction of masonry tank stands had commenced in Ward 28 and Ward 15. New technology to deliver water had been investigated, and river abstraction technology and the package plant were now ready to be presented to the Minister on 18 March.

Mr Ramulondi also highlighted that the Comet-Ha Rankopane pipeline, which was previously decommissioned, was now being refurbished to augment the Fika Patso System, and would assist in reducing dependency on tankers. A medium-term measure of constructing a 4km pipeline from Comet had commenced, and it was expected to be completed in four months. Work had also started at the Uniqwa reservoirs with machinery already delivered at the site. The Department had also managed to revive 17 boreholes on an emergency basis in Qwaqwa, and several areas were benefiting from them. 

Mr Ramulondi advised the Committee that meetings with stakeholders -- the councillors -- had commenced to prepare for the start of the laying of the pipeline and also to discuss labour issues and to introduce the project. To promote local economic development, local labourers would be sourced for the projects, and local small and medium enterprises (SMEs) would be roped in to assist with other functions, such as tipper trucks and other machinery required.

On water supply, through taps in the Fika Patso system, water reticulation audit findings noted that two outlet valves were not working, and two pump stations were not working also.

Discussion

Mr E Mthethwa (ANC, KZN) asked if the treatment plants hd been linked, how deep vandalism was.

This question was also echoed by Ms Z Ncitha (ANC, EC), who asked if they also took into consideration the needs of the elderly and the disabled with their JoJo tanks initiative.

Mr Ramulondi responded that the treatment plants were linked, and the work was still ongoing.

Minister Sisulu said the vandalism was high in the area, and it was caused by people who were in search of copper. In KZN, it was done by people who were demanding to be included in the water projects, and if they did not get included, they sabotaged the work. She was not sure about what was being done for the elderly, but she was going to assess that issue the next time she visited the area.

Ms.Ncitha asked the time frame for the water tankers, and if it was not more costly than building a dam.

The Acting CEO responded by saying they were drilling boreholes but for now they have to use tankers but after 6months the project should have been completed.

Ms M Mmola (ANC, Mpumalanga) asked by why position of the CEO had not been filled, and why they still had an acting CEO.

Minister Sisulu responded that the position had been advertised and by next month they would have a substantive CEO.

Ms C Visser (DA: North West) asked if they could clarify the issue of water tanks. The concept of private tankers should be abolished, and Government tankers commissioned to do away with corruption. At the moment, 25 tankers were on a lease to buy basis.

Mr I Sileku (DA: Western Cape) asked about the governance structure in the area, and where issues and challenges that the MAP face at these water tanks had been discussed, and what they were doing to reduce water losses.

The Minister responded by saying that they were working with the Department of Cooperative Governance and Traditional Affairs (COGTA) to deal with water losses, and they were also looking into innovative ways to assist in curbing this loss. On governance, she said they had a war room that consisted of all stakeholders, where these issues were discussed.

Mr G Michalakis (DA: Free State) asked why no real consequences were being taken against those who had destroyed the municipality.

The Minister said this was a collective effort and everyone was responsible for protecting state assets, and they would embrace any form of action taken against these perpetrators.

COGTNA-Free State Joint Intervention Team on MAP Municipal Report

Mr Lefatota: Administrator: Free State joint intervention team, briefed the Committee on their report. He agreed that the MAP was in a deep crisis, but was hopeful that the crisis could be resolved. The joint team had inherited a dysfunctional municipality that had poor service delivery, old electricity and water infrastructure, no road maintenance and regular occurrences of vandalism. The MAP had unfunded projects, fleet and tools challenges, poor stakeholder management and a poor wastewater treatment system. It had also inherited a MAP with an avalanche of litigation amounting to R4.055 billion, unstable labour relations, poor work performance and political instability. Under such a backdrop, the goal of the team was to build MAP into a financially sustainable, well-governed, resilient city, and achieve the turnaround strategy as a starting point.

To achieve this, over the last six months the team had created a five-pillar road map with key critical activities identified for implementation. These were governance and stakeholder management, institutional capacity, financial management, service delivery and infrastructure. On Governance, they had already started council meetings, with two sittings having been done so far. Moving on to the service delivery pillar, refuse service had been reinstated, though it was erratic due to the unreliability of the fleet. 59 electrical transformers had been replaced,15 cases of vandalism responded to, and an electricity cost of sale master plan piloted in partnership with ESKOM.

Also, water access had been imported on a short- and medium-term basis. There had been an installation of 320 water containers across all of the 35 wards. The team had also prioritised the operationalisation of three of the seven wastewater treatment works with funding, and had instituted a due diligence study on the MAP water process to determine its future form and existence.

In the immediate to medium term, the Committee was advised on what needed to be done in MAP. There was a need for the conservation and management of water, refurbishment of bulk distribution networks, repair of valves, pipelines and leakages, and an upgrade and refurbishment of the Sterkfontein/Tshiame water networks. On electricity, a technical audit on meters had commenced and would be completed. ESKOM service level agreement (SLA) negotiations were 90% complete, and they had developed a strategy to honour Eskom debt, which would be negotiated with them.

Regarding the financial management pillar, the overall financial performance for the past six months had been poor. Revenue collection had been instituted, monthly targets had been set, but they had only managed to meet a target of one month out of the five months set. A debtor management strategy had been put in place, but there was still poor performance. A creditor management strategy also existed, and there was good performance for creditors with invoices aged between 0 and 60 days. In the same vein, a three-month billing backlog had been eradicated and was now up to date, and the South African Revenue Service (SARS) liability of MAP Water, but asset management was still not being done. There was a need to service the ESKOM debt and enact data cleaning to ensure accurate billing.

On institutional development, the stakeholder management strategy had been implemented and the stakeholders were meeting regularly. A new organogram had been developed, but had been resisted by politicians and unions. The team had also managed to replace the payment of overtime with time off, as provided for in the collective agreement. The team had successfully managed the appointment of staff not on the organogram/unbudgeted, and had managed to draft a customer care policy. In the immediate mid-term to medium term, the team was seeking to approve a reviewed organogram, the headcount, conduct a skills audit, stabilise the workplace and implement consequence management on outstanding matters.

While the team had made interventions to address the challenges, there were some key challenges that were threatening the success of these interventions. These were political interference, lack of co-operation between team administrators and the elected troika, and regular disruption of operations by the union.

The recommendations the team had made over the crisis in MAP included the need to create a war chest to fund implementation of the accelerated programme for visible service delivery, strengthening institutional capacity in both the finance and infrastructure departments, re-aligning the budget to focus on current service delivery with a specific funded budget, and developing a consolidated service delivery innovation approval towards business development.

Discussion

The Chairperson asked Members not to ask questions on this presentation, but merely to make comments, and keep their questions until they visited the area in two weeks.

Mr Michalakis challenged the Member of the Executive Committee (MEC) to employ a forensic audit, and take serious action after that.

Mr S Zandamela (EFF, Mpumalanga) said for them to get a true picture of what was happening, they needed to visit this municipality as soon as possible, as there was a lot of confusion over the situation.

Mr A Gxoyiya (ANC, Northern Cape) said he was depressed about the relationship between the political office and the municipality, and hoped that the wrong billings would not affect consumers. He stressed the need to invite the Special Investigating Unit (SIU) and Hawks to brief the Committee on the progress of the corruption cases.

Ms S Shaikh (ANC, Limpopo) reiterated that all who were responsible for wrongdoing should be brought to book.

Mr K Motsamai (EFF, Mpumalanga) said there was no MAP – they would have to go and bury MAP when they visited.

Mr Sileku said the MEC should show commitment and act against perpetrators and not reward corruption. Consequence management should be instituted.

The Chairperson advised the Members that they would have to stop Eskom and COGTA from presenting, and wait to give their presentation when the Committee visited the area. However, he asked Eskom to just give a summary of the presentation on MAP.

Eskom Presentation

Ms Agnes Mlambo, Group Executive: Eskom, told the Committee that Eskom to date was owed R28 billion, and MAP's debt constituted 1% of that amount. She stressed that the 20% that they had agreed on with MAP was not a court order, but was an agreement between them and the municipality, after they had collected their assets. MAP paid Eskom only R2 million a month to service their debt, but that was not enough. She conceded that Eskom was guilty of not being hard on the municipality, and as a result it had now become difficult financially for them to maintain and service infrastructure in that area.

The Members were told that it was not the intention of Eskom to take the matter to courts, but it was facing pressure from other customers who were demanding security of supply.

The Chairperson adjourned the meeting.