Water Services Amendment Bill: adoption

Meeting report

LAND AND ENVIRONMENTAL AFFAIRS SELECT COMMITTEE
16 November 2004
WATER SERVICES AMENDMENT BILL: ADOPTION

Chairperson: Ms B Dlulane (ANC)

Documents handed out
Water Services Amendment Act [No. 108 of 1997]
Water Services Amendment Bill [B17-2004]

SUMMARY
The Committee considered the Water Services Amendment Bill. The Bill was required to give permission to local water boards to operate outside the country's borders. Members' concerns focussed on the financial implications for the government and the capacity problems of the water boards. Members felt that the decision to amend the Act was profit driven. Notwithstanding, the amendment bill was adopted by the Committee.

MINUTES
The Water Services Amendment Bill was designed to enable South African water boards to perform certain activities outside of the borders of South Africa. It allowed the Minister of Water Affairs and Forestry to determine the nature of the activities that a water board could perform outside the borders of the Republic; the countries in which the activities could be performed and the maximum amount of capital that a water board could take out of the country when engaged in cross-border activities.

Discussion
The Chairperson invited members to discuss and comment on the Bill.

Mr Mzizi (IFP) commented that there was not much to be discussed in the Bill, but asked what its impact would be on South African water reserves.

Ms M Oliphant asked about the benefits of the Bill to the country.

Ms Shreiner replied that water resources would not be affected as South Africa had been sharing water basins with neighbouring countries. The amendments would not benefit the country in any way.

Mr Watson asked why South Africa should let the Water Boards help neighbouring countries while they had limited capacity to service South African needs.

Ms Shreiner acknowledged that Water Boards had limited capacity but added that there was a dire need to help neighbouring countries which had limited capacity.

Advocate M Mzozoyana (SALGA) said that his organisation was opposed to the idea of a water services board operating outside the country. Furthermore, he suggested that SALGA should be consulted in all the decision-making processes because they were the primary buyers of water. For instance, Umngeni Water had done work in Nigeria and incurred loses amounting to R30 million. These losses were then passed on to South African consumers.

Ms Shreiner answered that local government would be dealt with in a separate process that concentrated on oversight.

Mr Van Rooyen commented that the Bill did not have an escape clause in case of a deal that went wrong.

Ms Shreiner replied that when the Water Board had to operate in another country, they had to sign a contract with the regulator in that country. Eskom, the South African Electricity Utility, had signed operating contracts before they could start operating.

Mr Van Rooyen commented that the proposed Amendment Bill dealt with public finances and if the Bill had no escape clause, the Water Board would find itself in difficulty. He made an example of South African Airways, which had lost billions of rands in a failed attempt to purchase new airplanes.

Mr Mzizi said the Bill had no immunity clause or "safety valve".

Ms Shreiner replied that an immunity clause applied only to the diplomatic community.

Mr R Tau asked why Water Boards rushed to help neighbouring countries when they did not have local capacity. Were the Water Boards driven by the profit motive or the principles of Nepad?

Ms Oliphant commented that the government should exercise control over parastatals such as the Water Boards. There was no need to involve SALGA in the process because the amendments were dealing with foreign activities.

Ms H Matlanyane asked where Umngeni Water got permission from to operate in Nigeria. The amendment bill was concerned with foreign issues and therefore SALGA had no need to worry.

Ms Shreiner replied that Umngeni Water had worked in Nigeria, and Rand Water had indicated interest in working extraterritorially. The amendment bill sought to formalise those activities with proper legislation.

Mr Mzozoyana said that SALGA had an obligation to protect South African consumers from debts incurred elsewhere.

Ms Shreiner replied that Water Boards were subject to oversight which looked at their programmes and the actual performance. The amendment bill would assist Water Boards to work outside the country. The South African Water Utilities Association had supported the proposed amendment.

Mr Tau suggested the motion of desirability.

Mr Watson commented that the time allocated to discuss the Bill was not enough.

The Chairperson informed the Committee that the National Assembly had already adopted the Bill.

Mr Mzizi suggested adoption and the Committee adopted the Bill.

The meeting was adjourned.