While raw water supply is in balance with existing demands on a national scale, there are localised deficits such as:

• Integrated Vaal River System (IVRS) that provides water to Gauteng, caused by increased demand due to rapid urbanisation, high non-revenue water and a delay in the start of Phase 2 of the Lesotho Highlands Water Project.
• Mgeni System that supplies the Durban and Pietermaritzburg region, caused by increased demand due to rapid urbanisation, high non-revenue water and a delay in the start of Umkhomazi Water Project.

However, it is very possible that  national demand could soon exceed supply due to:

• Higher levels of economic growth
• Continued urbanisation and population growth
• Failure to halt the huge water losses in municipal distribution systems
• Continued degradation of wetlands that are catchments, allowing water to enter rivers to fill dams and replenish underground aquifers
• Sewage and industrial pollution
• Climate change.

The good news

Phase 2 of the Lesotho Highlands Water Project as well as the Umkhomazi Water Project are now underway. But there is a need to further improve planning, procurement and project management of national water resource infrastructure projects to ensure that they are implemented timeously

The National Water Resource Infrastructure Agency Act was passed by parliament last year. This enables more finance to be raised on the markets for national water resource infrastructure projects.

Furthermore, the establishment of wall-to-wall Catchment Agencies will result in improved management of water catchments, which is key to increasing raw water security – all six have been gazetted and boards appointed.

We cannot keep building dams

There is a limit to the extent to which the construction of new dams can ensure water security.

South Africa is already harnessing approximately 75% of our sustainably utilisable surface water resources.

Therefore, there is a focus on diversifying the water resource mix through:

• increased sustainable use of groundwater
• desalination of sea water
• return flows from treated wastewater systems (water reuse)
• reuse of other poor-quality water such as acid mine drainage.

Better water conservation and water demand management (WCWDM)

The average consumption of water per capita per day in South Africa is 218 ℓ/c/d while the international average consumption of water per capita per day is 172 of ℓ/c/d. This is alarming when considering the fact that South Africa is one of the 30 most water scarce countries in the world. This level of consumption is unsustainable.

Supply-side measures are necessary but not sufficient to avoid future water deficits. WCWDM must therefore be implemented more effectively, particularly in domestic and general industrial use as well as by reducing physical losses in municipal distribution systems.

To date, the DWS as well as municipal WCWDM strategies have not been sufficiently effective, apart from the City of Cape Town.

State of water and sanitation services in South Africa

Nationally, over 90% of people in the country have a basic access to water. However, there are still some large backlogs, particularly in Limpopo and Eastern Cape.

The graph also indicates that there is a severe problem regarding the reliability of water services. Even though one may have access to a tap, water may not frequently come out of the tap and/or may not meet quality standards. The national average lies at 68%, but provinces vary greatly, with Gauteng and the Western Cape scoring over 90% and all other provinces scoring below 60%.

 

There are areas in the country that have high backlogs with regard to accessing even a basic level of sanitation; particularly in Limpopo, Mpumalanga and the North West Province.

Blue Drop and Green Drop and No Drop Reports

The 2022 and 2023 Blue Drop, Green Drop and No Drop Reports show a sharp decline in municipal performance since the last assessments in 2014. With the widespread deterioration of municipal water services, South Africa is not on track to meet the Sustainable Development Goal (SDG) 6: Clean water and sanitation for all. These Drop Reports collect a large amount of information on municipal water and wastewater systems in all municipalities.

There are 144 WSAs, they are a municipality that has been appointed by the Minister of Cooperative Governance to be responsible for water services. The red a yellow areas on the map are the WSAs that were found to be in a critical or poor state of performance. It is apparent that at least half of the geographical area of the country has WSAs with drinking water systems that are in a poor or critical state of performance. The percentage of water supply systems with poor or bad microbiological water quality compliance increased from 5% in 2014 to 46% in 2023 this is resulting in increased risk of water borne diseases, potentially life threatening diseases such as cholera and chronic diarrhoea.

The 2022 Green Drop Report found that 334 out of a total of 850 wastewater systems are in a critical state of performance. Approximately 80% or the geographical area in the country have WSAs have wastewater systems in a poor or critical performance. Around 66% of all municipal wastewater infrastructure is in a poor or critical condition.

There are 90 of the 144 water services (more than 60%) had at least one critical wastewater system. Wastewater systems with critical or poor state of performance result in pollution through discharging partially treated or untreated water into rivers and the environment. The 2023 Green Drop Progress Assessment Report indicated further decline.

Again, according to the 2023 No Drop Report, almost 80% of South Africa’s geographical area have non-revenue water greater than 40%. High levels of NRW, including physical losses, in Gauteng and Kwa-Zulu Natal are one of the reasons for water supply disruptions that  have been experienced there.

Reasons for decline in municipal water services

These include:

• The non-adherence to standard operating processes for drinking water treatment and wastewater treatment
• Infrastructure in a poor condition due to a lack of maintenance
• Infrastructure not having sufficient capacity – such as overloaded wastewater treatment plants

There is a  clear correlation between a lack of skilled staff (plant managers, process controllers, technicians and scientists) and water and wastewater systems that are in bad or critical state. For example, Gauteng has the highest percentage of drinking water systems with excellent or good performance and the lowest shortfall of qualified staff; Northern Cape has highest percentage of drinking water systems with poor or critical performance and highest shortfall of qualified staff.

Vandalism and metal theft are an increasing cause of infrastructure failure, but this is partly a result of inadequate security being provided by municipalities.

Additionally, inefficiencies in billing and revenue collection systems prevent municipalities from securing the necessary funding for essential maintenance and the hiring of skilled personnel. Furthermore, even when adequate funds are available, municipal councils often fail to prioritise budget allocations for water services.

National government is transferring over R60 billion per year in grants to municipalities for water and sanitation services. This includes the portion of the equitable share which is meant to be used by municipalities to provide free basic water to the indigent, as well as various infrastructure grants which are meant to address historical infrastructure backlogs. But apart from those grants, the water services sector has to be self-financing through revenues from the sale of water.

A national average non-revenue water percentage of 47.4% means that, on average, municipalities do not obtain any revenue from almost half the treated water that they have to pay to produce or that they have to buy from the water boards, which in turns mean, firstly, a large portion of the money spent on developing water resource infrastructure is wasted. Secondly, it means that municipalities do not have sufficient funds to operate and maintain their water services, and thirdly, that municipalities are not able to pay the water boards for the treated water supplied by them.

The water boards which are worst affected have stopped paying the DWS for the raw (untreated) water supplied to them, which means that the funds available to DWS to maintain and operate the national dams and related infrastructure are insufficient.

This debt is a threat to the financial viability of the entire water value chain.

What can be done to change the status quo?

Four key actions are required:

1. Water and sanitation infrastructure grants to WSAs must be refocused on increasing access to a basic level of services
2. Support from national government to municipalities must be strengthened
3. The review of the local government funding model and water and sanitation conditional grants must be finalised
4. Reforms of water services at municipal level must be implemented.

The funding gap caused by high non-revenue water must be addressed

Municipalities must:

• Prioritise budgets for maintenance and for reducing leaks in water distribution systems
• Ensure that all reported leaks are fixed quickly
• Close illegal water connections
• Replace old leaking pipes, including asbestos pipes (which are a danger to health)
• Improve management of their water systems (through pressure management for example)
• Strengthen metering, billing and revenue collection.

If a municipality lacks sufficient capital, there is significant potential to partner with the private sector. By implementing the above measures, a sustainable revenue stream can be created and provide returns on private sector investments.

Addressing municipal debt owed to water boards

The Minister has been engaging premiers and mayors regarding municipal debt to water boards and this has resulted in commitments by some municipalities to pay their current invoices in full.

• Credit control measures have been standardised and are being implemented by all the water boards. National Treasury has agreed to the withholding of equitable share allocations of non-paying municipalities as a last resort and this is being implemented.
• National Treasury has approved a write-off mechanism for historic debts in terms of which water boards can incrementally write off a municipality’s historic debt on condition that the municipality pays its current accounts in full.

Reform of water and sanitation services

Revenue from the sale of water must be ring-fenced. All management functions related to the delivery of the water and sanitation services should be ring fenced with single point accountability.

These reforms are underway. This is done through a:

1. Water Services Amendment Bill that will shortly submitted to cabinet for approval to be submitted to Parliament. The two key amendments include:
   • Introducing an operating license for water service providers (WSPs)
   • Clarifying the roles and responsibilities of WSPs and WSAs
   • Minister may force separation of water services function from the municipal administration where there is persistent failure to meet license conditions, and require municipality (as WSA) to contract with a licensed WSP
2. National Treasury’s Reform of Metropolitan Trading Services Programme, that is a performance-based incentive grant component given to metropolitan municipalities that has submitted a
   • A council approved water turnaround strategy
   • A roadmap on institutional reforms for improved management and governance
   • A water and sanitation business and investment plan that is consistent with the water services development plan
3. Phase 2 of Operation Vulindlela
   • Develop a national water action plan and establish a coordination structure to ensure water security
   • Implement institutional reforms to improve the management of water resources, including full establishment of the NWRIA and CMAs
   • Strengthen the regulation and oversight of water service provision through the creation of an independent economic regulator for the water sector, covering the whole water value chain
   • Create a separation between water service authorities and water service providers
   • Require all metros to establish or appoint ring-fenced, professionally managed and independently licensed utilities (either external or internal) for water & sanitation and electricity
   • Finalise review of the funding model for local government
   • Finalise review of conditional grants to optimise their impact and effectiveness
   • Support the introduction of private sector partnership in the water sector.

WSA’s the current situation

The legislation governing municipal water services differentiates between the role of WSA and water service provider (WSP). WSAs are supposed to be the local regulators that ensure that water services are provided in accordance with the national norms and standards legislation. WSAs are supposed to enter into service level agreements with WSPs, which are the bodies which actually provide the services. However, in almost all of our municipalities, the WSA and WSP function have not been separated, even though it is required by law.

In most municipalities, the WSA has decided (which is within its rights to do), to deliver the service through internal delivery mechanisms. This has resulted in the creation of a technical department which is responsible for the management of water issues in the municipality. However, many of the key functions required to effectively deliver the service like revenue collection, customer relationship management, human resources and supply chain, are not within the management control of the water services department. Often, this department receives an annual budget that has no relationship whatsoever to the amount of revenue collected from the sale of water. Municipalities use revenue from the sale of water for other purposes. This means that the head of the department has no incentive to manage water services in such a way as to maximise or optimise revenue collection, for example, through prioritising the installation of meters.

In light of the amendments to the Water Services Act, it must be noted that municipalities can decide to retain internal WSPs, and several metropolitan municipalities have opted to continue with internal WSPs. But they will ring fence them within the municipality, particularly in terms of revenue and control over management functions.

Increasing private sector involvement in the water sector

More than 60% of national water resource infrastructure projects are funded by private sector finance raised by the TCTA – establishment of the NWRIA will enable more private sector finance to be raised for national water resource infrastructure projects.

Innovative new financing mechanisms are also being developed such as green and blue bonds and are already being applied in catchment management such as the Water Bond put in place by Rand Merchant Bank and The Nature Conservancy in the Western Cape, which is financing the removal of alien vegetation that consume large amounts of water. The DWS and the water boards are implementing non-commercial partnerships with industrial sectors, such as the Olifants Management Model Project in Limpopo with mining houses. The Infrastructure Fund is assisting DWS, the water boards, and municipalities to put in place blended finance projects in the water sector.

As private sector involvement in municipal water services is very low compared to other countries, the Water Partnerships Office has been established to facilitate better partnerships with the private sector. This includes Build, Operate, Train and Own or Transfer (BOTT) models. Recently, the Water Partnerships Office issued an expression of interest for municipalities to participate in Water Reuse Programme as substantial green climate funding is available for its project preparation and blended financing.

South Africa’s water and sanitation systems are under immense strain, with urgent reforms, investment, and better management needed at all levels. While there are promising developments – from infrastructure projects to legislative reforms and growing private sector involvement – success will depend on coordinated action, stronger local capacity, and a shift toward sustainable water use. Ensuring water security is not just a technical challenge, but a national imperative.