Question NW17 to the Minister of Water and Sanitation

Reply:

a)  Both DWS and COGTA allocate grants (RBIG, WSIG and MIG) to municipalities for water and sanitation infrastructure and have the power to ensure that these grants are used for their intended purpose. However, DWS does not have legislative powers to ensure that local governments earmark their own funds for either maintenance of existing water and sanitation infrastructure or for new water and sanitation infrastructure. Water and sanitation infrastructure is not a provincial function, and provincial governments cannot be expected to allocate funds earmarked for provincial functions such as basic education or health to municipal water and sanitation.

The RBIG and WSIG grants have conditions attached to them (prescribed by the Division of Revenue Act) requiring them to be used for new infrastructure projects, as well as for the refurbishment and upgrading of existing infrastructure. DWS is not allowed to use the grants to fund operation and routine maintenance of municipal water and sanitation infrastructure. Operation and maintenance of municipal water and sanitation infrastructure is supposed to be funded by municipalities from revenues raised from the sale of water and from sanitation charges. However, there is no legal requirement for municipalities to allocate such revenues to the water and sanitation function, and many municipal councils do not prioritise operation and maintenance of their water and sanitation infrastructure when they approve their municipal budgets. This problem is exacerbated by poor billing and revenue collection processes in many municipalities.

The table below indicates RBIG and WSIG allocations for the 2024/25 financial year per province:

Regions	RBIG 6b	RBIG 5b	Transfers to Water Boards	WSIG 6b	WSIG 5b	Total
	Budget allocation	Budget allocation	Budget allocation	Budget allocation	Budget allocation	Budget allocation
	R'000	R'000	R'000	R'000	R'000	R'000
Eastern Cape	317,423	707,935	0	45,000	562,092	1,632,450
Free State	649,208	220,112	276,084	32,000	330,959	1,508,363
Gauteng	710,863	0	279,000	28,425	246,742	1,265,030
KwaZulu Natal	0	428,744	315,000	200,000	1,070,000	2,013,744
Limpopo	752,661	126,013	317,000	429,973	483,713	2,109,360
Mpumalanga	351,595	497,246	0	113,415	442,470	1,404,726
Northern Cape	35,281	577,000	113,000	30,000	327,492	1,082,773
North West	226,095	401,333	1,152,194	167,905	429,996	2,377,523
Western Cape	14,831	894,000	0	0	144,209	1,053,040
Total	3,057,957	3,852,383	2,452,278	1,046,718	4,037,673	14,447,009

b) In addition to the RBIG and WSIG grants, DWS has established a Water Partnerships Office together with the DBSA and SALGA. The role of the Office is to provide support to municipalities to establish partnerships with the private sector. For example, it is currently supporting the eThekwini, Mangaung, Buffalo City, Nelson Mandela Bay and Tshwane municipalities to put in place performance-based public private partnership contracts to reduce non-revenue water.

The DWS is also working with the Infrastructure Fund and the Budget Facility for Infrastructure (BFI) to raise additional funding for municipal water and sanitation projects, in collaboration with willing municipalities. This involves collaborating in project planning, funding and implementation of large, blended finance projects.

DWS is also collaborating with industry, including the mining and agricultural sectors, to invest in new water infrastructure. For example, DWS is implementing two projects in Limpopo and the Northern Cape in partnership with mining houses and the relevant municipalities, through which DWS and the mines are jointly funding both bulk water infrastructure and new household connections to communities. The Olifants Management Model in Limpopo is a R25 billion multi-year partnership between DWS, municipalities and mining houses to construct bulk and potable reticulation water infrastructure to supply communities and mines in Sekhukhune and Mogalakwena in Limpopo. The programme will provide potable water to yard connection to an estimated 390 000 people. Similarly, the Vaal Gamagara Bulk Water Scheme in the Northern Cape is a partnership between DWS and mining houses to supply potable bulk water for mining, industrial, agricultural and domestic use.

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