1. 1 Presentation to the Portfolio Committee: Water & Environment Presentation by Mr Helgard Muller Acting CD: Regulation 16 – 17 March 2010 Water services and regulation

2. 2 Reasons for amendment of WS Act Align Act with other legislation such as MFMA, changes in local government and other policy changes, Better regulate Water Services Right of Minister to intervene directly in case of non-compliance Streamline governance of water boards Tariff regulation needs strengthening Gaps identified that require addressing- vague areas such as industrial water

3. 3 Process to amend WS Act Amendment process produced a first draft- then placed on hold pending outcomes from Mazibuko court case Review of draft Bill to start once more. Draft Water Services Act submitted to Cabinet to get approval for public comment Passed in Parliament

4. 4 Drinking Water Quality Status Generally the status of DWQ in South Africa is good: – In 2008 (12month period) the average compliance nationally was 93.3%. – Compliance figures for August 09 was 96,5%; May 09 recorded 94%. – The compliance target is 97%; in line with the National Standard’s (SANS 241) compliance requirements. – There is an evident consistent improvement.

5. 5 Drinking Water Quality Status However, while this all sounds promising, the Department is more concerned about the areas not being monitored; or those inconsistently monitored. (One cannot manage nor regulate what is not being measured.) No monitoring leaves the affected communities at risk. Municipal Monitoring frequencies must improve to be in line with national standard requirements (SANS 241:2006). Special attention to monitoring of DWQ is especially required in the smaller villages.

6. 6 Blue Drop Certification This incentive-based regulation initiative had its 1 st public report launched in May 2009. This concept was presented to the Regulation Network of the World Health Organization in Singapore (June 2009). It was very well accepted; This innovative regulatory concept seeks to amalgamate legal requirements and best practices within the domain of drinking water quality management towards sustainable improvement. (Simplistic) Objectives: Name and Praise – Serves as a DWQ goal Name and Praise – Stimulate proactive DWQ management. – Brings the Public Opinion into the equation; Revealing performance

7. 7 Blue Drop 2009 Findings In spite of relatively good performance; Challenges remain in: – Labs not accredited – Water Services Institutions not always sufficiently prepared for adverse incidences. – Generally DWQM is underfunded The 2009 Blue Drop Standard was set high; 2010 will be slightly higher; National Average BD Score: 53% (70% of all systems were assessed). – 435 Water supply systems were assessed; 23 systems achieved Blue Drop status.

8. 8 The South African Municipal Waste Water Business Approximately 900 waste water treatment works; Transporting and treating about 7 589 Mega liters of waste water per day. Capital replacement value of >R23billion. Required operational expenditure of >R3.5billion per annum. The South African Municipal Waste Water Services business is generally found to be far from acceptable.

9. 9 The South African Municipal Waste Water Business This state of disrepair is mainly due to: – Lack of proper Asset Management; – Lack of proper Infrastructure investment; – Rapid development of formal sanitation services (causing overloading); – Inadequacies in process controlling capacity; etc.

10. 10 Green Drop Certification Incentive-based Regulation approach for waste water services- the Green Drop The first national audit produced the first Green Drop report. Release the Green Drop Report at a date to be announced by the Minister and also introduce an action plan. Some findings: – 449 systems assessed – 203 systems scored better than 50% – Rest needs drastic improvement

11. 11 Proposed Actions to improve situation  Dedicated support to low-capacity municipalities,  Cost determination to assist municipalities and sector partners to plan and budget realistically  Training & mentoring programs for artisan, process controllers and plant managers  Implementing a world-best-practice regulatory system using a 3-pronged approach:  DWA allocated R 200 million to refurbishment of WWTW  Appoint private sector providers to operate and maintain on behalf of municipalities

12. 12 Proposed Actions to improve situation (2)  Assisting municipalities with license preparations and fast tracking license processing  Improving communication with the media, in ensuring that media receive factual information  Strengthen programs aimed at providing information  Exploring the ‘opportunities’ offered by wastewater facilities in terms of job creation,  Exchange programmes with international expert institutions

13. 13 Amount owed to WBs According to the latest report to National Treasury water boards reported a total outstanding debt of R 1,1 billion: Some examples of monies owed: Bushbuckridge: approximately R145m owed by Bushbuckridge LM Bloem Water vs Mangaung LM = appr. R28m Sedibeng Water vs Dikgatlong LM = R5.4m as at Sedibeng Water vs Tsantsabane LM = R4.6 m Rand Water vs Madibeng LM R19m

14. 14 Progress made on Water Board disputes Successfully resolved Umgeni/Msunduzi and Bloem Water/Ukhahlamba Bushbuckridge Water vs LM – DWA team investigated and tabled regulator report to resolve the dispute. Currently working on processes to implement those recommendations Bloem Water vs Mangaung LM – recommendations have been finalised. Will be tabled soon to both parties Dikgatlong LM & Naledi LM – claim that they are unable to pay, therefore requesting financial assistance Madibeng LM and Nala LM – are under administration Phokwane LM; Ditsobotla LM & Matjabeng LM – have started paying off their debts Kungwini LM – NT still monitoring the debt