Department on Amendment to Water Boards Pricing Structure: briefing; Committee Report on Hearings on Water Quality & Water Secur

WATER AFFAIRS AND FORESTRY PORTFOLIO COMMITTEE
30 August 2006
DEPARTMENT ON AMENDMENT TO WATER BOARDS PRICING STRUCTURE: BRIEFING;
COMMITTEE REPORT ON HEARINGS ON WATER QUALITY AND WATER SECURITY, AND OVERSIGHT VISITS: DELIBERATION AND ADOPTION

Chairperson: Ms C September

These minutes were provided by the Committee Clerk

Documents handed out:
Presentation to Portfolio Committee on Water Board Tariffs
Committee’s Report on the Oversight Visits to Limpopo and North West provinces
Committee’s Report on Public Hearings on Water Quality and Water Security
All available later on Committee Reports

1. Opening and Welcome
The Chairperson opened the meeting and welcomed everybody present. She stated that the meeting was for Department of Water Affairs and Forestry to do briefing on the amendment of the pricing structure of Water Boards in terms of the Municipal Finance Management Act. The Committee would also consider and adopt Committee Reports on public hearings held on water quality and water security. The committee would also consider and adopt Committee Report on Oversight visits to Limpopo and North West Provinces.

2. Announcements
The Chairperson informed the Committee that an invitation to an Arbor Day celebration outside Parliament was received from Mr Brett Myrdall of SANPARKS. The Committee is in process to make the necessary arrangements and will inform Members accordingly.

3. Adoption of Committee Report on hearings held on water quality and water security
The Chairperson tabled a report:

“Report of Public Hearings on Water Quality and Security in South Africa: Towards a Joint Action Plan to Improve Water Quality for South Africans, Portfolio Committee on Water Affairs and Forestry, 20 – 21 July 2006 and 07 August 2006.

Mr TDH Ramphele moved, seconded by Ms SN Sigcau for the adoption of the report which would include amendments on recommendations.

Report adopted.

4. Adoption of Committee Report on oversight visits to Limpopo and North West Provinces.
The Chairperson tabled a report:
“Report of the Portfolio Committee on Water Affairs and Forestry to the Limpopo and North West Provinces (30 July – 04 August 2006)”

Mr J Arendse moved, seconded by Ms P Bhengu for the adoption on the report.

Report adopted with the following amendments under the section of Limpopo province:

Recommendations
Whilst government has made strides in beginning to deliver water resources and infrastructure thereof, a major challenge exist still around equal access to water. Thus a concerted intervention is required led by DWAF to assist municipalities to ensure that communities in particular, gain access to clean drinking potable water using the relevant finances that has been approved, expediting reticulation processes where resources has been completed, providing skilled human resources to municipalities. To also apply the water reallocation process where communities are without clean drinking water. To also assist municipalities to spend monies allocated for drought relief where access to no water occurs.

An urgent operation and maintenance process should be initiated where schemes, boreholes and other relevant resources that are inoperable are prohibiting communities to gain access to water.
DWAF to provide speedier assistance towards municipalities in overcoming water quality challenges that prohibit all to gain access to clean, safe drinking water including those caused by sanitation through VIP’s.

DWAF to obtain certainty from the Department of Environment and Tourism about bringing the delay of the construction of the ASGISA project, the De Hoop Dam to a close so as to allow further augmentation to much needed access to water for various uses.

DWAF together with SALGA to engage with the Department of Public Works in handing over the water scheme to the relevant Water Service Authority in Mopani. Also DWAF to finalise the section 78 application of the Mopani Municipality.

DWAF, relevant municipality to engage further with the authorities of the Kruger National Park to bring consensus on all the water related issues, forestry and working for water programmes as well as investigating whether any attention needs to be given to the neighbouring with regards to any access in an equitable manner of water.

A provincial strategy supported by DWAF, SALGA, municipalities and the Provincial legislature to overcome the vandalism of water resources and infrastructure by communities.

That Water Boards be more involved in ensuring that services delivery obligations are met through providing skills, financial support and an integrated approach towards governments objectives of eradicating the backlogs in water and sanitation.

An investigation to hold into the Vhembe District by DWAF supplying water allegedly only when the Portfolio Committee arrived.

DWAF together with The Department on Mineral and Energy to look into the issue of sand mining, its licensing and its effects on water resources.”

The Committee agreed that the North West part of the report should be reviewed by the delegation that went on this visit.

5. Presentation by Department of Water Affairs and Forestry
Ms B Schreiner briefed Members on DWAF’s presentation on Water Boards tariffs. The presentation focused on: section 42 of the Municipal Finance Management Act (MFMA): process in terms of MFMA: tariff increases of bulk water – 2006/07: challenges faced during the process and way forward [Copies of the presentation were circulated to all Members and are available on request]

6. Discussions
The Committee raised the following concerns:
Clarification on Water Boards that did not meet Municipal Finance Management Act timeframes?
Clarification on Water Boards that did not request for tariff increases.
What is the relationship between municipalities and Water Boards?
How does tariff increases affect the end users?
What mechanisms are in place to ensure that the end users are not worse off?
What informs municipalities to react to tariff increases?
Do municipalities have the capacity to compile information on tariffs?
Do the municipalities bear the cost of the adjustments?
That the committee is unable to measure the information before us and its impact and therefore has to go along with the tariff amendments. Also why Leepele Water Board is the lowest and what is the situation with Mhlatuze not having complied in their application. Clarity on the polluter pay service and how is the formulation of pricing structured?

The following responses were provided:
The Department of Water Affairs and Forestry will meet with Water Boards who did not increase tariffs to determine if this is a sound business decision.

Tariffs are the revenue received by Water Boards. Not all Water Boards pays bulk tariffs. That DWAF need a specialist to deal with tariffs. Not all Water Boards pay bulk tariffs and that cost of water in different sources are different, water boards operate differently SAAWU met with DG and Minister of DWAF to resolve dispute. Mhlatuze will re-look their requirements

Water Boards also went through a process of consultation with South African Local Government, municipalities and consensus has been reached with regard to tariff increases.

The relationship between Water Boards and municipalities is regulated by contract; it must now be revisited due to the compliance with the Municipal Finance Management Act. New pricing strategy is not approved yet but will also include the polluter pricing strategy.

7. Resolutions
After deliberation, the Committee resolved that it consider the amendment of the pricing structure of Water Boards. The Committee would consider having a pricing strategy workshop which will include all the relevant roll-players. The Committee also supports the Finance Minister’s consent to approve for late compliance as stipulated in the MFMA. The Committee expressed its discomfort in non-compliance with the act in so far as when it must be tabled in Parliament by all.

The Committee further resolved that relevant stakeholders that are involved in tariff increases must ensure that it meets the required time frame of 15 March and that DWAF should lead this process.

8. Closure

The meeting adjourned at 11h50 until Wednesday, 06 September 2006.

__________________

Ms C C SEPTEMBER, MP
Chairperson: PC on Water Affairs and Forestry          Date: _________________________


Present:
African National Congress (ANC)
Mr JD Arendse
Ms P Bhengu
Ms ML Ngwenya
Ms TE Lishivha
Mr ID Mogase
Mr TDH Ramphele
Mr BG Mosala
Ms CC September
Mr BZ Zulu

Apologies
Mr KJ Kati (ILL)
Mr K Moonsamy
Ms MNS Manana
Mr JA Semple
Mrs D Van der Walt

Inkatha Freedom Party
Mr MW Sibuyana

United Democratic Movement
Ms SN Sigcau

United Christian Democratic Party
Mr PHK Ditshetelo

The following persons were in attendance:
Department of Water Affairs and Forestry
Deputy Director General: Ms B Schreiner
Chief Director IO: Mr Silas Mbedzi
Assistant Director WBO: Mr Thoane Sengfeng
Acting Chief Director: Mr Tseliso Ntili

The South African Allied Workers’ Union
Mr Willie Modisha (Exco – SAAWU)
Ms Jean Ngubane (Rand Water - Chairperson, Exco - SAAWU)
Mr Makumu Libisi (Exco – SAAWU)
Mr Lawrence Sithole (Exco – SAAWU)

DWAF Parliamentary Liaison Officer
Mr Zakhele Hlongwane

Acting Committee Secretary
Mr Bradley Viljoen

Committee Assistant
Ms Mandisa Mbingilele