Residents living in 10% of South Africa’s municipalities face a dry December as their supplies of water services are restricted. The Minister of Water Affairs recently announced that 29 municipalities which are in substantial arrears to the Department will have their flow of water reduced. This will result in taps running dry or reduced water pressure in many parts of the country.
Currently municipalities owe water boards approximately R10-billion in arrears bringing the financial viability of these crucial entities into question. Almost 70% of this debt is owed by the 29 municipalities.
The biggest debt is owed by Matjhabeneng municipality. The area around Welkom owes almost a third of the 6.7 billion owed by the 29 municipalities (R1.8-billion). The next highest amounts are owed by District Municipalities in Limpopo. Vhembe District Municipality (R642-million) and Mopani (R520-million debt) serve rural areas of north east Limpopo. Several largely urban municipalities are also in substantial arrears. Two such areas are Mangaung Metro (R349-million) and Gauteng’s Emfuleni (R 270-million).
In addition to restrictions to their bulk water supplies the Department of Water Affairs seeks to have financial transfers from Treasury to the municipalities held back until arrangements have been made to settle the arrears. The Department has specifically targeted Equitable Share Grant transfers. Municipalities receive Equitable Share Grants from Treasury to ensure that essential services are available to all. Should the Department of Water Affairs succeed the money required to service those needing state support for services will not be made available to the 29.
Given that the Equitable Share Grants are regularly made by Treasury it seems that the municipalities in question do have the financial resources to pay for essential services. However it does appear that these municipalities have managed their financial resources poorly. UWCs’ Applied Constitutional Studies Laboratory (ACSL) shows that 80% of the municipalities affected routinely fail to comply with the rules governing municipal financial management. None of the municipalities have received clean audits and almost half (13) of the municipalities routinely get ‘Disclaimers’.
The remainders routinely fail to submit the required documentation or get qualified audits. Disclaimed audits suggest significant flaws in the financial management of the institution.
The move to restrict water supplies to municipalities follows similar moves relating to the electricity. ESKOM has recently moved to restrict bulk power supplies to municipalities until they have made good on arrears payment. It thus seems that unless financial management of these municipalities improves many South Africans will face a dry, and dark, Christmas.
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