Committee Report on DWS 2020/21 Annual Performance Plan & Budget

Meeting report

The Chairperson welcomed all in attendance and tabled the agenda.

Committee Report: Budget Vote 41
Ms Shereen Dawood, Content Adviser, Portfolio Committee on Human Settlements, Water and Sanitation, went through the Draft Committee Report on Budget Vote 41 in a page-by-page fashion.

Discussion
Ms G Tseke (ANC) commended the Department for providing water tanks and boreholes to rural areas. She stated that departments and municipalities that owe money to the Department of Water and Sanitation (DWS) must be reflected in the observations of the Report. The timeframes provided will help the Committee better perform its oversight role. She asked how fraud and corruption are flagged in the Department. The Committee needed progress reports on investigations on fraud and corruption cases in the Department and on ending the bucket system in Free State, North West and Eastern Cape.

Mr L Basson (DA) stated that the Draft Report refers to the main account but does not make mention of the trading account which is concerning as the trading account is in overdraft. The account is linked to Trans-Caledon Tunnel Authority (TCTA) and to municipalities. Vacancies were set to be filled by January 2021 however, considering the Auditor-General’s report and the StandingCommittee on Public Accounts (SCOPA) investigation on the DWS, he recommended that key vacancies be filled by at least August 2020. Mr Basson asked if he could make a written submission on changes to the report. The Chairperson agreed and stated that he should send his submission to the Committee Secretary.

Ms R Mohlala (EFF) supported Mr Basson regarding the trading account being reflected on the report. Despite intergovernmental relations, framework challenges arise. Service provision of quality water to citizens is hampered by challenges associated with municipalities being unable to manage their responsibilities as outlined by the Water Services Act and wastewater discharges. The issue is that even if DWS shifted its focus towards strengthening its role as a regulator with stronger enforcements, it will still be bound by the constitutional imperatives of cooperative governance. This results in a limited ability to intervene in the local sphere of government as the DWS does not have the authority to remove the powers and functions of a non-compliant municipality.

The Committee’s assessment of wastewater treatment and purification works has covered the impact of municipalities being unable to fulfill their obligations by ensuring that operations and maintenance of wastewater treatment plans and purification systems are at optimal functionality. Although the DWS submits directives for systems to be cleaned and operational, the limited authority of the DWS within the cooperative governance framework makes it difficult to effectively enforce policy. The DWS undertakes assessments of wastewater treatment systems. Close monitoring of non-compliance in terms of the Water Services Act has to be strengthened.

She asked why the DWS has not finalised the Water and Sanitation Bill.  Does the DWS have the capacity and capability of drafting legislation? The Department says that the Bill will be tabled in the fourth quarter of 2020 - this has been said for the last few years. What has the State Law Advisor said about the Draft National Water and Sanitation Bill? What is the oversight role of the Committee in ensuring that funds are spent, that water tanks are distributed, and that boreholes are constructed? Critical oversight is needed on how DWS supply-chain management and procurement processes are complying with the Public Finance Management Act.

The DWS has taken on emergency projects such as the war on water leaks. This has impacted its finances for many years. These projects are used as money making schemes where some loot the state for their own benefit and interest. Thus, it is recommended that the Minister undertake efficient oversight on how regional bulk infrastructure grants have been utilised in the time of COVID-19 especially the supply-chain management processes which should be compliant with Finance Management Acts.

Ms Mohlala stated that she does not remember the Committee agreeing on the District Development Model (DDM) as a solution to address the issues across the institution. The DDM needs to be located within the context of the intergovernmental relations framework and cooperative governance and functions of water services and provision. The DDM’s rollout of pilot projects has not been appraised for its efficiency nor its implementation.
 
With the challenges of grant funding towards water and sanitation infrastructure, the tensions that emanate between DWS and departments should have the Minister work towards funding agreements between water services and authorities and departments with a clear understanding of how much should be funded by each party.

Integrated planning and consulting of municipalities must be prioritised in relation to the funding arrangement for reticulation of bulk water supply. Reticulation is the mandate of the municipalities but as a regulatory Department, the Department should ensure that value-chain processes are connected. 

Mr A Tseki (ANC) stated that the DDM was welcomed on Friday 5 June 2020. May the report and findings of the Auditor-General be considered as a recommendation? The draft report needs to include the investigations underway in the Department. He asked that the submissions made to alter the report be circulated to the Committee.

Ms N Sihlwayi (ANC) stated that the Draft Report was thorough and has raised many issues, despite needing consolidation here and there. Making submissions to the Chairperson privately may be problematic. Please could the Chairperson provide clarity on how this will be done as the rest of the Committee is interested in potential changes? Regarding COVID-19 interventions, there are areas of concern regarding water tanks. There are many water tanks that are not constructed well, and some do not have water. Can the Department look into this? There were many challenges in the implementation of water tanks which is understandable as it was an emergency process. What is the sustainability of the water tanks? The Water Bill has been in process for a lengthy time and it should be finalised before the end of 2020. The DDM was presented to the Committee and supported. The details of the DDM were recently presented and its implementation needs to be looked at carefully. The vacancies need to be filled by the end of 2020 and no later. Desalination was presented as very expensive - please can an expert present to the Committee on this topic?

Ms Mohlala interrupted Ms Sihlwayi and stated that the DDM was only supported by the ANC and not the Committee. The Chairperson condoned Ms Mohlala’s interruption of Ms Sihlwayi and stated that the EFF will have the opportunity to contest the DDM Report in the National Assembly.

Ms N Mvana (ANC) commended the great detail of the Draft Report. 

Ms E Powell (DA) agreed with Ms Mohlala that the Committee did not support the DDM on Friday 5 June 2020 as no vote was taken. It is more correct to say that some Members supported the DDM rather than saying the Committee supported it.

She recommended that the steps that are being taken to address fraud and corruption within DWS be outlined in the Report. SCOPA has launched an independent inquiry into the management of the Department - this should also be reflected in the Report. There is a funding gap of R33 billion which is needed over the next ten years and which has to be addressed by improved revenue generation as articulated by the Water Master Plan. It was good that the Draft Report noted that R33 billion is needed to close the gap on water services. Other debt such as the municipal debt should also be included in the Report.

Challenges around transfers and grants with regards to the Water Infrastructure Development needs to be outlined as well as the role of the Department of Cooperative Governance and Traditional Affairs (COGTA) in administering infrastructure grants and the challenges of synchronising the two Departments. How the Water and Infrastructure Grant operates needs to be outlined. Funds have been badly managed in the past. What is handed to municipalities hampers the intentions of the DWS and its ability to ensure that bulk water infrastructure is developed across the country. The Auditor-General undertook a study of the Department’s performance in the respect of the effectiveness of the bulk water infrastructure grants and there were substantial findings which should be included in the report.

Municipal debts are a serious issue and this needs to be underscored in the recommendations. In October 2019, a joint meeting between COGTA and DWS showed that R14 billion is owed to water boards by municipalities and R160 billion is owed to municipalities by water users. DWS is staring down the barrel of a gun in this regard and the water services are heading down the same direction as Eskom unless a substantial solution can be formulated to deal with this crisis. The draft report states that the Finance Minister should submit a report to this Committee however, the Committee was presented to in October 2019. The recommendations now say that solutions must be found by November 2020. This means an entire year passed with no further information presented to the Committee. How can the Committee develop a new collection mechanism when National Treasury, DWS, COGTA and the South African Local Government Association (SALGA) are all engaged in finding solutions? Past engagements need to be mentioned in the report. 

Ms C Seoposengwe (ANC) stated that the bucket system needs to be eradicated and the Report should include a timeframe on this.

Mr R Mashego (ANC) stated that the Draft Report was previously brought before the Committee and Members had the opportunity to make their contributions. The agenda for the meeting was thus to adopt the Report and amend things that were not included but were mentioned when the Report was first brought before the Committee. Considering this, Mr Mashego was pleased with the manner and professionalism of the Report. He supported the comments regarding the bucket system and said these should be included in the Report. He stated that the amounts mentioned by Ms Powell of R14 billion of municipal debt was updated and reported back to the Committee thus, the Report presented is a true reflection of the current situation in the Department. The formulation of the DDM occurred prior to COVID-19. When reading it with COVID-19 in mind, it may cause some confusion unless one is aware of the fact that it was formulated before COVID-19. Furthermore, the DDM was adopted. He raised the point that vacancies cannot be filled by August 2020 as there are stipulated timeframes for the recruitment process such as three months of advertising, one month of shortlisting and so on. He thus recommends that a list of appointments and vacancies be submitted to the Committee after the deadline of January 31, 2021.

Ms S Mokgotho (EFF) stated that the decrease in the budget of the Water Sector Regulation programme will impact regulation. Does the DWS have the capacity to enforce compliance of relevant norms and standards and the Water Services Act? There are a limited number of compliance officers in the Water Sector Regulation Unit. Recent oversight by the Committee of the Vaal River System resulted in the recommendation that the Minister should enforce compliance on water users that pollute underground water, streams and rivers.

Ms Powell stated that politics is played outside the Committee. At the National Assembly, Members vote, make divisions, declarations and talk politics. The floor [at Committee meetings] should be open for all Members of the Committee to make their contributions so that a detailed Report goes before the National Assembly. She hopes that the Report will include all contributions and not follow Mr Mashego’s suggestion to adopt the Draft Report as is.

The Chairperson stated that Ms Powell misunderstood Mr Mashego. He did not suggest that the Draft Report be adopted as is.

Ms Mohlala stated that she concurs with Mr Mashego that the [presentations on the] Budget Vote, Strategic Plan and Annual Performance Plan took place however, the DDM came after that and should not be included in the Report. It is the ruling party’s decision on whether to include the recommendations made by the Committee, but the problem is that the poor people on the ground who need Water and Sanitation will struggle.

Mr Mashego interjected and stated that Ms Mohlala cannot speak for the people on the ground as she represents the minority.

Ms Mvana stated that Ms Mohlala likes to argue and a back and forth debate ensued.

The Chairperson stated that the majority of the Members suggested that the Report be adopted. Thus, the recommendations submitted by Members in writing will be included if it does not change the content of the Report. A meeting will be called should any recommendations not be included.

Ms Mvana moved the adoption for the Report as amended.

Mr Mashego seconded the adoption of the Report. The Report was adopted.

Ms Dawood stated that the amendments and recommendations will be added to the Draft Report in red and this will be re-submitted to the Committee.

The EFF opposed the adoption of the Report.

The meeting was adjourned.