Question NW273 to the Minister of Cooperative Governance and Traditional Affairs

Reply:

a) There are several reasons why the Mangaung Metro has not been able to service it’s water account with the Bloem Water entity which amongst others are as follows:

The current tariffs and charges levied by Bloem Water are not affordable and the municipality is therefore not able to sustainably service the account. The current revenue collection rate for water services is not sufficient to service the Bloem Water account.  In addition, funding needs to be prioritized for operational expenditure in relation to water services provided by the Metro.

Outstanding debt from residents and underpayment by government departments. Department is assisting the municipality with cost of supply study on water services, which will assist the municipality to design tariff setting and to have cost reflective tariffs. 

The Centlec entity has continued to pay it’s Eskom current account despite the challenges of the 15 days as opposed to 30 days payment arrangement. It is worth noting that payment of the Eskom account is made beyond the 15 days due to a number of reasons viz.

Mangaung metro is a rural metro and cannot sustain 15 days payment period from Eskom.

The Eskom bill includes 24 hours billing including unserved energy which still requires payment during loadshedding.  This matter has been brought to Eskom’s attention and a request made to offset unavailability of the supply from the billing. The Centlec entity suffered from 208 days loadshedding, like all other municipalities in the country during 2022. Table 1 below shows the statistical real- time data. The technical, operational, and monetary impact of on-going loadshedding results in increased expenditure to maintain the electrical infrastructure network , despite  the increasing monthly Eskom bill Table 1 below illustrates the financial impact relating to the cost of loadshedding from January 2022 to December 2022 with a total of 497.50 hours of loadshedding which is equivalent to a monetary cost factor of R 85 754522.81.

This significant impact should be apprehended in the monthly bulk Eskom account bill, however at this stage the figures below exclude the vandalism to   infrastructure, theft of cables during loadshedding that impacts on the revenue collection.

The replacement cost of vandalism and theft to electricity infrastructure impacts on revenue collection and increases the repairs and maintenance budget which is not funded and results in prolonged outages because of loadshedding. A task team has been established between CENTLEC and Eskom to find amicable solutions towards resolving the payment of outstanding debt.  

 

7. MONTHS	LOADSHEDDING
	EVENTS (DAYS)	DURATION (HOURS)	COST (R)
JANUARY 2022	-	-	-
FEBUARY 2022	6.00	15.00	2,905,715.78
MARCH 2022	7.00	17.50	4,664,129.65
APRIL 2022	10.00	25.00	4,177,189.10
MAY 2022	26.00	65.00	8,561,435.34
JUNE 2022	11.00	27.50	9,823,477.93
JULY 2022	22.00	55.00	11,189,281.51
AUGUST 2022	7.00	17.50	2,276,111.96
SEPTEMBER 2022	24.00	57.50	14,880,366.46
OCTOBER 2022	27.00	67.50	10,837,806.41
NOVEMBER 2022	30.00	75.00	7,652,835.94
DECEMBER 2022	30.00	75.00	8,786,172.74
TOTAL FOR PERIOD	200.00	497.50	85,754,522.81

         Table 1:  Cost of Loadshedding

(b)       Due to changes in the political leadership of the Mangaung Metropolitan Municipality, the Council meeting scheduled for 31 January 2023 did not take place to approve the 2021/2022 Annual Report and Auditor General’s Report.  These reports were however tabled and approved during the Council meeting held on 13 February 2023.

End.