Water Services Act Regulations: Progress Report

Meeting report

WATER AFFAIRS AND FORESTRY PORTFOLIO COMMITTEE
23 May 2001
WATER SERVICES ACT REGULATIONS: PROGRESS REPORT

Chairperson: Ms B P Sonjica

Relevant Documents :
Draft Regulations of Water Services Act of 1997 (Act 108 of 1997)
Briefing on developments: Regulations for the Water Services Act (see Appendix)
Powerpoint presentation

SUMMARY
The Department of Water Affairs and Forestry reported on progress made with regards to regulations relating to the provision of Water services. Committee Members raised various concerns particularly relating to regulations governing service providers. The Committee agreed to consult the government policy framework relating to private partnerships. It was suggested that the Department of Water Affairs and Forestry present information about the Municipal Systems Act to the Committee and provide the Committee with information relating to the authority and powers of municipalities.

MINUTES
Mr J Potloane, Deputy-Director General for the Department of Water Affairs and Forestry, stated that the Minister is currently drafting regulations for sections 9(1), 10 and 19(5) of the Water Services Act of 1997 (see attached documents).

The Deputy-Director General highlighted that the process of drafting the regulations was very consultative and that the Department felt the regulations were accepted and owned by all stakeholders. According to the DDG the acceptance of the regulations would ensure quality service, efficiency, cost effectiveness and sustainability of the services.

Mr Potloane mentioned that the Department was consulting with NEDLAC as requested by COSATU and SAMMU during their discussions. This process of consultation will be finalised by June.

Discussion
Ms Sonjica (ANC) complimented the Department of Water Affairs and Forestry for having consulted all stakeholders relevant to Water services.

Mr Sigwela (ANC) commented that it was the responsibility of local government to implement these regulations. He asked how the Department had consulted at local government level and the nature of the relationship between Provincial government and stakeholders.

Mr Potloane replied that there is cooperation between SALGA, which is representative of all municipalities, and Provincial offices to ensure cooperative governance and to ensure that the regulations are understood by all local governments.

Mr Bhengu (ANC) asked how Free Basic Water was going to be implemented to benefit the disadvantaged communities.

Mr G Moelar (Department of Water Affairs and Forestry) replied municipalities were required by law to have development plans for the implementation of Free Basic Water. Further, municipalities were required to report regularly on progress made during implementation.

Ms Gwenya (ANC) asked whether the installation of water meters had been discussed with people, especially in rural communities, to prevent them from using river water because they have fears about paying a lot of money.

Mr Moelar replied that prepaid meters do not affect the "6000 litres free water" principle, but added that those who exceed the 6000 litres will have to pay for the additional litres.

Mr Van Wyk (ANC) asked whether there is a subsidy scheme for the benefit of farm workers who are staying on private land. He commented that if there was a subsidy, farmers would benefit when farm workers received the service. In this regard Mr Van Wyk asked what measures were available to avoid this cross-subsidisation.

Mr Potloane replied that according to policy the farmers have to provide sanitation to their employees. Tthe Department of Water Affairs together with the Department of Health provides the standards on which these services must be given. He denied that the farmers would also receive government subsidy.

Mr Van Wyk quoted certain farms near Kimberly where the subsidy had been given. Mr Van Wyk was supported by the Chair and other Members who stated that they had also witnessed this cross-subsidisation whilst touring in their constituencies. Ms Sonjica asked the Department to note this matter and to report back in the next meeting.

Mr Ditetshelo (UCDP) requested the DDG to clarify what sort of mechanisms were in place to report back to communities and what the requirements were to receive Free Basic Water.

Mr Potloane replied that all households with an income below R1100 will receive 6000 litres of free water.

Mr McIntosh (DP) asked why the Department had consulted with NEDLAC.

Mr Potloane replied that the Department was asked by COSATU to consult NEDLAC. COSATU's members had asked for clarity on the procurement of service providers especially where services would be provided by private service providers.

Mr Matebe (ANC) asked how the Department intends to ensure water quality and ensure accountability in this regard.

Mr Potloane replied that the matter of water quality will be the responsibility of the Local Government Department and the Department of Health.

Ms Sonjica (ANC) asked how the Department intends to ensure that there are reports on compliance with the regulations by all service providers.

Mr Potloane replied that reports on compliance with the regulations will appear in all local government reports when they report on the their development plans. Local governments are required by law to regularly report on their development plans.

Mr Kwatwal (ANC) asked for clarity on the Departments position towards people who were not using pipe water.

Mr Potloane replied that everybody would have to pay for water regardless of how it was accessed. He also stated that the Department would have to examine how much ground water was available and whether such water would comply with the quality standard as set by the Department.

Mr Bhengu (ANC) commented that according to the Water audit many bore-holes had dried out.

Mr Potloane confirmed that the Department had inherited many bore-holes from the former homeland governments and many of them had dried out. He also stated that the Department was not sure what had caused the bore-holes to dry out, but the popular suggestion was that the communities had failed to maintain these bore-holes.

Mr Matebe (ANC) asked what the Department envisaged for those communities that were far from water pipes.

Mr Potloane commented that of the 7 million people with no water the Department has targeted to service 2 million people with water during 2001/2 financial year.

Mr Moelar explained that the Department had received comments with regards to s 19 (5). COSATU had also raised questions about the standards regulating contracts with service providers. These contracts can operate for a maximum of 30 years.

Mr Maimane (ANC) pointed out that regulation 6 of s 19(5) contained a contradiction and suggested that the Department be prepared for the public to review this regulation. This regulation refers to private - public partnerships and public - public partnerships.

Mr McIntosh (DP) asked what COSATU and the Rural Services Development Network had to do with delivering services to the people. According to Mr McIntosh's understanding the Portfolio Committee had to give communities the right to chose the service provider of their choice, even of the service provider came from the private sector.

Mr Maimane said that Mr McIntosh's remark was out of order because his argument had nothing to do with COSATU.

Ms Sonjica (ANC) commented that private-public partnerships fall within the policy framework of government and hence the Committee did not reject these partnerships. However she added that the Committee would reject private partners seeking to profit from these partnerships.

Mr Moelar commented that the Department stipulated that all contracts must work for the benefit of consumers. Further, he said that the regulations apply to all companies whether registered as public or private companies, since some private companies hid under the title of a public company.

Mr Matebe (ANC) suggested that the Committee have another presentation on the Municipal Systems Act. Mr Maimane also insisted that information on the authority and powers of municipalities be distributed at the presentation.

Ms Sonjica also suggested that the Committee have a presentation on the government framework regarding public-private partnerships, to increase the Committee Members' understanding of these partnerships.

Mr Van Wyk (ANC) asked whether the Municipal Systems Act had means of preventing public-private partnerships from overcharging communities for services delivered and for preventing labour exploitation.

Mr Potloane replied that there was legislation dealing with tariffs for services provided.

The meeting was adjourned.

Appendix:
REPORT TO THE PORTFOLIO COMMITTEE OF THE NATIONAL ASSEMBLY ON WATER AFFAIRS AND FORESTRY:
Progress and Status of the Regulations in terms of the Water Services Act, 1997 (Act No. 108 Of 1997)

INTRODUCTION

The Minister is currently developing regulations in terms of sections 9(1), 10 and 19(5) of the said Water Services Act.

Regulations in terms of section 9(1) prescribe compulsory national standards relating to the provision of water services. All water services institutions must comply with the compulsory national standards.

Regulations in terms of section 10 prescribe norms and standards in respect of tariffs for water services. The Minister must obtain the concurrence of the Minister of Finances before making these regulations. No water services institution may use a tariff that is substantially different from these prescribed norms and standards.

Regulations in terms of section 19(5) prescribe matters which must be regulated by a contract between a water services authority and a water services provider as well as compulsory provisions to be included in such a contract. The Minister has to consult the Minister for Provincial Affairs and Constitutional Development (now the Minister for Provincial and Local Government) for the purpose of making these regulations.


PROCEDURE

Apart from the normal principles and procedures that apply to the promulgation of all regulations, the Water Services Act prescribes some additional procedures applicable to regulations to be promulgated in terms of that Act:

The initial procedure for making regulations is prescribed by section 71(1):

The draft regulations must be published in the Gazette for comments.
Copies of the draft must be sent to the Minister for Provincial and Local Government, the relevant Province, any organisation representing municipalities and any relevant water board for comments.
All comments must be considered.
It must be reported to which extent comments have been taken into account.

In terms of section 74(1)(a) the Minister may not delegate the power to make regulations.

The draft regulations are then published in the Gazette at which moment they become regulations.

Within 30 days after such publication the Minister must table the regulations in Parliament. Parliament then considers the regulations taking into account the matters stated in section 75(1). If Parliament rejects a regulation it must be repealed by the Minister within 30 days. Although the term draft regulation is used in section 75(1), the consensus is that it is an error and should be amended in due course to read regulation.


REGULATIONS IN TERMS OF SECTION 9(1)

The procedure described in paragraph 2.1 above, has been completed so that the draft has now been approved by the Minister for publication in the Gazette at which moment they will become regulations.

These draft regulations are the product of extensive consultations with stakeholders which include a number of national and regional workshops and meetings. It was endeavoured however to maintain a balance between thorough consultation and the need to finalise the regulations. The Department possibly erred on the side of over consultation - from there the delay.

There are however reasons for urgency as became evident from the judgement in the Durban High Court in the case of Thulise Manquele v Durban Metropolitan Council (reported in February 2001). It was said that in the absence of the section 9 regulations certain sections of the Water Services Act relating to basic services are unenforceable. Apart from this judgement many local authorities are also urgently awaiting the promulgation of these regulations in order to finalise their own bylaws in line with the regulations.

The remaining steps for final promulgation are therefore:

publication in the Gazette; and
tabling in Parliament.

The target for promulgation is June 2001.


REGULATIONS IN TERMS OF SECTION 10

At present the draft of these regulations is ready to be submitted to the Minister for approval before publication in the Gazette when they will become regulations. Formal concurrence from the Minister of Finance was received on 15 May 2001.

These draft regulations have also been developed after extensive consultations which include the presentation of national and regional workshops as well as meetings with stakeholders. Key stakeholders who were extensively consulted and who in some cases even assisted in the drafting process include SALGA, DPLG, National Treasury, DBSA, the Mvula Trust and the WRC. A booklet containing draft guidelines to the regulations was produced and distributed to assist stakeholders to comment. The comments received had a considerable influence on the contents of the final draft.

The remaining steps for final promulgation are therefore:

submission to the Minister for approval;
publication in the Gazette; and
tabling in Parliament.

The target date for promulgation is June 2001.


REGULATIONS IN TERMS OF SECTION 19(5)

The draft of these regulations will be ready for final consideration by the Minister shortly, having gone through the processes as described in paragraph 2.1, above.

Consultation is similarly the outstanding feature in the creation of this draft. To facilitate commenting a booklet containing a foreword by the Minister, a policy note as well as the text of the draft was printed and widely distributed during June 2000. Extensive workshops and meetings were held. The comments received were of inestimable value in the process of creating a draft that will provide for all foreseeable situations. An example is comments from Rand Water that had been received at a very late stage and of which a substantial part was nevertheless incorporated in the draft.

The draft regulations have been submitted to the National Economic Development and Labour Council (NEDLAC) for comment, as requested by COSATU / SAMWU during the consultations. This consultation with NEDLAC is currently ongoing.

The remaining steps for final promulgation are therefore:

Complete consultation with NEDLAC;
submission to the Minister for approval;
publication in the Gazette; and
tabling in Parliament.

The target date for promulgation is July 2001.