Annual Strategic Plan & Budget 2007/8 Department of Water Affairs & Forestry, briefing on Amatole Municipality Service Backlogs

Water and Sanitation

01 May 2007
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Meeting report

WATER AFFAIRS AND FORESTRY PORTFOLIO COMMITTEE
3 May 2007
ANNUAL STRATEGIC PLAN AND BUDGET 2007/8 DEPARTMENT OF WATER AFFAIRS AND FORESTRY, BRIEFING ON AMATOLE MUNICIPALITY SERVICE BACKLOGS

Chairperson:
Ms C.C. September (ANC)

Documents handed out:
Presentation by Mr. J.I. Sindane on DWAF Strategic Plan 2007/8-2009/10 & Budget 2007/8
Presentation by Ms. N. Ngele on DWAF Strategic Plan 2007/8-2009/10 & Budget 2007/8 Corporate Services
Presentation by Mr. T. Blazer on Vote 34 (ENE)
Presentation on behalf of the MEC for Water Affairs and Forestry from the Eastern Cape
Amatole municipality presentation

SUMMARY
The Hearings on the Annual Strategic Plan and Budget Vote 34 were scheduled to take place over a two day period from the 3 to the 4 May 2007. This report includes the first half of the meeting on the 3 May 2007. The meeting was composed of three presentations by the Department of Water Affairs and Forestry, a presentation on behalf of the MEC for the Eastern Cape, and a presentation by the Amatole municipality.

The presentations by the DWAF were introduced by Minister, who highlighted the success of the DWAF while acknowledging some concerns, such as the 8 million people still living without adequate supply and sanitary. The key areas of focus would be on internal and external flagship programs and emphasised the intention of the Department to be more streamlined and efficient. The first presentation looked at resource management, forestry and international involvement. The second presentation, on corporate services in the DWAF, emphasised capacity building and highlighted the various initiatives intended to augment capacity. The final presentation entailed an overview of the Department’s budget, designed so as to reach its strategic goals.

Subsequent discussion focused on clarity in capacity building, economic benefits to rural populations specifically, women, the disabled and the youth, and the balance and budget of particular initiatives. The presentation was a statistical overview of   backlogs, Municipal Infrastructure Grant registered projects, the number of households served, the total value of the projects, the remaining backlog, and shortfall targets.

The Eastern Cape provincial department, in their presentation, looked at the demographics and backlog of services in the Amatole District Municipality, funding required to eradicate the backlog of services in Amatole District Municipality, and bucket eradication. It also looked at physical progress up until 16 April 2007. Consideration was given to urban migration, monitoring mechanisms, and finally mechanisms on addressing the shortfalls.

MINUTES
Presentation by the Department of Water Affairs and Forestry (DWAF)
Introduction by the Minister
The chairperson welcomed the respective delegations and invited the Minister to introduce the Department’s presentation.

The Minister of Water Affairs and Forestry, Ms. L Hendricks, began by acknowledging the President’s emphasis on expanding access to basic water supply as a human rights matter. The Minister pointed out that a UN report acknowledged that South Africa was one of the few countries that spent more on water and sanitation then on their military budget. However, about 8 million South Africans still did not have adequate water supply and sanitation.

The Strategic Plan had been conceived as the means to rectify the abovementioned challenges. She welcomed inputs from other entities and the committee. The Minister acknowledged previous concerns that had arisen around human resources and qualified audits, and said that the necessary steps were being taken to address these issues. Skills were still needed though, and the ultimate goal of improved delivery should always be kept in mind.

The Minister highlighted key areas of focus in the Department which included internal and external flagship programmes. The Department was in the process of restructuring and transformation to address the challenges of non-alignment, unclear mandates, duplication, non-integrated institutions, and costly governance and resources. The intention was to transfer most of the implementation functions to more appropriate levels of government while still focusing on its role as policy developer, regulator and sector leader, as well as strengthening their oversight and monitoring role.

The Department required a shift from an operational focus to a more management role; it would then be more efficient and focused. It was a priority for her to finalise the restructuring of the Department, which would end the process started in 1995. The recent drought had highlighted the real dangers faced by South Africa regarding the scarcity of water supply; with recent economic growth, water needs were expected to increase, thus making planning essential. She highlighted the international co-operations to improve water analysis and dissemination. The Department was playing an active role in promoting water management and conservation. The Department’s strategy was to manage the existing infrastructure and to develop new water infrastructure, which the budget increase allowed for.

Regardless of the plans, the Minister said that her current goal was to ensure and maintain water supply and sanitation to households, schools, and clinics, which the significant budget increase would attempt to address. She noted that delivery was through local government and that local government was committed to meeting its targets confirmed by SALGA at its annual meeting. Regarding forestry, the Minister said that the perception of insufficient focus on forestry may have been based on increasing private sector and community involvement. Forestry was consolidated under one division with a DDG appointed to drive forestry in the future.

Department’s strategic plan and budget
Mr J Sindane (Director-General: DWAF) looked at water resource management, water services, forestry and international affairs.  He highlighted the fact that the Department had placed the achievement of gender equality and equity at the centre of the strategic plan. The aim was to rally the staff of DWAF and public entities to join hands to implement government policies falling within the mandate of the Department. Their role was to support and strengthen the capacity of municipalities to meet their water and sanitation target, and to create an environment in which municipalities were better able to fulfil their constitutional and legislative mandates. He said they planned to continue the development of water resources to support economic growth and provide water for basic needs.

Regarding water resources management, Mr Sindane said that the supply of water was a critical input for the achievement of the aims of AsgiSA and State of the Nation Address (SONA) and that the reallocation of water was central to bring about equality and as a direct input to the alleviation and eradication of poverty as referred to in SONA. He maintained that the Department would continue with their major projects like De Hoop Dam in Limpopo; Nandoni Distribution Works; Hluhluwe Regional Water Supply; and Mdloti River Resource Project (raising of Hazelmere Dam), while the Berg Water Project would be commissioned this year. He also added that the department would continue to implement measures to ensure the protection of water resources through, amongst others, the Working for Water Programme.

With regard to institutions, he said that the establishment of a national water resource infrastructure agency was underway, with legislation to be introduced in 2007. Regarding the public entities, the plan was to formulate and implement a governance framework to ensure both their proper governance and provision of support, and leadership to public entities. He said the Department would continue with the establishment of CMAs and the promotion of the involvement of local government to promote local management of water resources.

Mr Sindane emphasised the need to accelerate the service delivery in order to meet water and sanitation targets. He pointed out that cabinet approved the Service Delivery Acceleration Plan in January 2007 to provide hands-on support to affected municipalities working with DPLG. Regarding capacity building, he said the Department’s comprehensive local government support plan was in line with local government’s five year strategic agenda. He claimed that new infrastructure would be developed in addition to the operation and maintenance of existing infrastructure. He said that the Department intended to establish collaboration with provincial departments of local government and provincial departments of health, to ensure the quality of drinking water, as well as collaboration with SALGA.

Regarding forestry, Mr Sindane said the goal was to implement detailed programmes to ensure broad-based black economic empowerment with the Forestry Charter, which addressed many of the other elements under the SONA. To raise the rate of investment in the first economy, he said the Charter detailed concrete roles and resources for government and the private sector to achieve higher rates of investment, and pointed out that the Department had already almost halved the time to get an afforestation licence. There were plans in place for 2007/2008 to use general authorizations to reduce cost and time further. Applications had risen from 800ha in 2004 to 5500ha last year. To increase spending on Scientific Research and Development, he said the Department would finalise the proposal for Forestry Science Technology and Innovation strategy, develop capacity and approach Treasury for funding for implementation.

Finally regarding International affairs, he highlighted the Department’s involvement in forestry and water activities within the Southern African Development Community (SADC) to achieve regional integration, the management of cross-border relations on shared watercourses, the participation in post conflict reconstruction in Africa, and participation in NEPAD structures and international fora, such as the World Water Forum and UN Forum on Forestry.

Ms N Ngele (Deputy Director-General: Corporate Service) emphasised the administrative focus on building departmental capacity. The department was involved in two forms of interventions, short and medium term interventions. Regarding short term interventions on capacity building, the Department was involved in sourcing financial specialists from the office of the Accountant-General, and employing internship programmes which included 70 finance interns. The Japan placement programme looked at 56 technical specialists. However she said that 50% of vacancies still need to be filled. Medium term interventions included a learning academy containing 30 trainee scientists, 14 forestry scientist trainees and 17 trainee engineering technicians. An exchange programme, employing existing bilateral agreements, was also being developed.

Her presentation also underscored the plan to increase competency levels in current employees. In order to establish institutional realignment there was a need to identify obstacles to institutional reform, assess the extent of alignment of institutions to DWAF mandate, and assessed the extent of DWAF’s institutions to government structures such as provinces and local government. Regarding organizational realignment she said the Department would conduct a comprehensive organisational review of structural design, systems and culture, reorientation of DWAF to meet government’s objectives, improve organizational performance, apply of normative performance standards, achieve full compliance, and engender a culture of performance.

Her presentation also emphasised the organization and empowerment of women, youth development, transformation, and monitoring and evaluation.

The final section of the DWAF presentation entailed an overview of the budget designated for the achievements of the Department’s strategic goals. It indicated that the total medium term expenditure for 2007/8 was R5 306 347. Of the total expenditure 9% was designated to administration, 9% to forestry, 46% to water resources, and 36% to Water Services. Further breakdowns of these figures were provided (See documents for further detail). A surplus of R718 998 was also projected for 2007/8.
 
Discussion
Mr Arendse (ANC) acknowledged the progress made by the Department, but argued that the old problem of capacity still persisted. He asked for clarification on the capacity building initiative including time lines.

Mr Sibuyana (IFP) asked what plan of action was in place for the rural population and specifically those who are economically viable to use the water resources. Regarding the Department’s commitment to assist municipalities in planning and infrastructure, he asked how they planned on implementing projects where there was no MEC for water affairs; and he enquired as to why the Siyenza Manje urgency was only being felt at that late stage.

Ms Semple (DA) acknowledged the focus on gender by the Department but asked how the Department was going to address job creation for women in the rural population. She requested a breakdown of the internships with regard to the number of women recruited.

Ms Manana (ANC) was concerned about youth development and asked for a breakdown of youth numbers in the proposed development program. With regard to water delivery, she stressed that it was not just quantity that mattered but quality and she asked what measures were in place to ensure quality. She also asked for time frames on the projects to be provided.

Mr Mosala (ANC) asked for clarification on the 17 finance interns recruited. He asked the DG if there was any tension within the water services programme.

The chairperson asked for elaboration on the outputs in 2006 an 2007 and how those outputs coped with the challenges.

The Minister said that it was not fair to assume that Siyenza Manje had been adopted late. She believed that the Department had learned a lot during past years and recently have been confident to accelerate programmes.

Mr Sindane said that, regarding capacity building, the programme was open-ended, as it was designed to be ongoing. However, he did acknowledge the need for annual timeframes to be established. He further emphasised the need for open ended capacity building to continuously be a source of new skills. Regarding the rural utilisation of water facilities, he said the Department promoted the involvement of local government to ensure that they could utilise the facilities to generate their own income and take opportunities to utilise and incorporate them into their structured plans. He said support was also provided to develop these plans.

Regarding plans for economic growth in the rural population, Mr. Sindane said that job creation would take place in the mining sector and the building of dams, and several other activities, but he said the major benefit to about 800 000 people would come from the municipal districts utilisation of the dams. Siyenza Manje was aimed at accelerating distribution programs without compromising on quality. Regarding the effectiveness of the relationship with municipalities, he said that if the districts did not have MEC’s they were still subject to the provinces which had established relations with the Department.

A breakdown of the learning academy composition with regard to women and youth could be provided but it needed to be understood that the provincial department always emphasis the interests of women and youth. Mr. Sindane agreed with the Member on the issue of quality of water and said that the role of the health officers of the water-board was to ensure the quality of the water. The number of people receiving portable water and sanitation has increased, but the real question was whether it was sufficient. He said that the difficulty lay in building capacity at local government, however plans were in place to address this.
 
The Minister clarified that even though capacity building was open-ended in a sense, the Department did have a retention strategy; however it was important to note about the academy that old engineers had become mentors or teachers. Regarding gender and the participation of women, the Department had been strict in ensuring that percentages had been set aside for women, youth, and people with disabilities.

The chairperson opened the floor for a second round of questions.

Ms Bhengu (ANC) said that focus on the sustainability of water supply was lacking. She asked if there was a dispute between resource management and supply. She also wanted to know what the key aspects of the department’s review of past performance was and how it affects the budget.

Mr Arendse said that there was a government wide assessment and evaluation paper prepared by the governance and administration chief directorate. He asked if Department staff were aware of the document. Secondly he asked why the budget was not sufficiently balanced between the Working for Water programme and the Working on Fire programme; he felt the latter was being marginalised. This sentiment was reiterated by the chairperson and Mr. Sibuyana who further expressed concern regarding the Department inability to retain skilled workforce in the latter.

Mr Sibuyana asked what role SELGA played in the rural areas.

Ms Semple asked why the budget for African participation had been so greatly increased.

The Chairperson asked if there was further engagement with the provincial governments other than the water summit where important issues were raised. She felt that many of the problems were split between supply and management and integration was thus undermined. She asked if sufficient emphasis was given to water resource management regarding supply. She also asked what attention was being given to manage different areas’ water supply as they tended to differ in their needs.

Ms Ngele said, regarding capacity, that the programme should retain 551 interns for a two year contract. Regarding financial interns she maintained that a relatively even spread of employment was distributed through the country.

A DDG added that, regarding job creation in the water delivery and sanitization environments, the Department had increased the population target, thus acknowledging the need to double their efforts. To upscale delivery certain innovations needed to be developed, such as the Department’s initiatives to train the communities in delivery of sanitation where it had shown favourable results in the Free-sate and the Northern Cape. The focus was not only on providing water for basic use but to find ways of utilising the full potential of water resources, for example in gardening and subsistence farming.

She said the biggest challenge lay in creating sustainable jobs; thus the Department would be looking towards secondary industries, such as the production of furniture, to use the products that came from programmes such as Working for Water. Regarding monitoring and evaluation, the Department was working closely with provincial and local government. There still remained insufficient information on what was happening in the provinces as far as monitoring was concerned. However, she maintained that monitoring units would be put in place to deal with this. Regarding the alignment of water services and resources, she acknowledged the weakness, but there were mechanisms in place to ensure municipalities enforce water conservation techniques and drinking water quality management. Finally she said that development plans were being developed in collaboration with provincial and local government to focus on integration of water services and resources.

Mr Blazer said that the programme for Working with Fire was across two budgets, the land based and Department of Provincial and Local Government budget. On the African participation budget increase, he said that the increase seemed larger than usual to the relatively small amount designated to this sector in the past – the previous budget of R300 000 had increased to R800 000.

Mr Sindane concluded by saying that achievement in the last financial year was an example to the SADC countries and the rest of Africa. He highlighted the fact that the Department had achieved an award for its good progress. Finally he pointed out that after the previous years planning phase the implementation phase was coming to fruition.

Presentation by the Eastern Cape Provincial Department of Water Affairs
The Chairperson invited the representative for the MEC for Eastern Cape, Mr F Majavu (Deputy Director: PPM), to begin his presentation on behalf of the MEC who had not been able to attend the meeting.  

Mr Majavu’s presentation was a statistical overview of 2001 backlogs, MIG registered projects, the number of households served, the total value of the projects, the remaining backlog, and shortfall targets. These covered the areas of water services, sanitation, and bucket eradication (See documents for detail).      

It also considered the requirements for the province to achieve its targets such as increased MIG allocations, secure funds to maintain infrastructure and replace ageing infrastructure to prevent of new backlogs, increasing Water Service Authorities’ institutional capacity and outsource Project Management Unit (PMU) non-core functions, ensuring the management of professional service providers who design and manage projects (i.e. escalations), the establishment of partnerships between established and developing professionals and contractors to improve overall productivity, and finally providing leadership to ensure collaboration of sector partners
The presentation also recommended strategies, such as adequate MIG Medium Term Expenditure Frameowork (DORA) allocations for both water and sanitation, which were far below in the province relative to national target. He said that the province and municipalities should declare the bucket eradication programmes as an emergency.

Mr X Msweli of the Amatole District Municipality (ADM) considered demographics and backlog of services in ADM indicating a backlog of 82%, funding required to eradicate the backlog of services in ADM indicating a requirement of R950 million by 2010, and bucket eradication in where funding allocations did not address the bulk services. It also looked at physical progress up until 16 April 2007, expenditure up until then. The presentation state at an additional amount of R38 million was urgently required to ensure proper operations of these systems. Finally the remaining challenges to eradicate buckets in ADM were shown to be extremely high tenders, and the additional amount of R38 million for bulk urgently required to ensure proper operations of all systems.

Discussion
Mr. Sibuyana asked if the department had information on municipalities regarding their budget and if it could be made available. He called on the committee to further investigate the backlog, shortfalls and requirements in these areas.

Mr Arendse asked how the provincial department of local government and housing were monitoring the migration of people from urban to rural areas and how this was incorporated into the planning for water provisions in the province.

Ms Manana asked how the provincial government addressed the issue of informal settlements in their province with regard to water supply and sanitation. She asked if the proposed budget included informal settlement. Finally, she asked if cheaper tenders were also being considered.

The chairperson asked what was being done about the shortfalls indicated. She also asked if monthly targets were being set up in order to monitor progress on eradicating the bucket system.

Mr Msweli pointed out that quarterly targets were set up to monitor performance levels, however, targets are only set with available funding in mind and thus shortfalls were difficult to address. Until funds were granted the tenders cannot be awarded. The shortfall had been discussed with the department on a number of occasions and was not a new matter. There was constant discussion with the department on dealing with the shortfalls. He maintained that funding was not the only factor at play, but other issues such as water source challenges, and capacity of the contractors in the construction industries. Regarding the informal settlement he argued that informal settlements, even though not fully acknowledged by government, were communities that needed to be supplied with water and sanitation, and thus mechanisms to formalise informal settlements were being put in place. Issues of urban migration were also being addressed but the focus needed to be on special planning for migration. He argued that incentives to retain rural dwellers such as agricultural schemes were being considered in partnership with the Department of Agriculture. Finally regarding tenders, cheaper service providers were considered, but so to were profiles of black empowerment companies. He said communities were involved in development projects but internal squabbling could be a problem.

The meeting was adjourned for lunch.      


 

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