Umgeni Water requires R200-billion to fix backlog

17th February 2017

By: Bloomberg

  

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The water board serving South Africa’s second-most-populous province said it needs at least R200-billion to address a service backlog, almost double the country’s total budget for water and sanitation for the three years to 2019.

“The real headache is where the funds are going to come from,” said Shami Harichunder, a spokesperson for KwaZulu-Natal province’s Umgeni Water. The board services metropolitan areas including Durban, the country’s largest after Johannesburg and Cape Town.

The figure comes from a study on water security by 11 municipal authorities in the province and another two in the neighbouring Eastern Cape that showed that R121-billion was needed to build bulk water infrastructure, including dams, water-purification plants and pipelines, and a further R100-billion for reticulation, Harichunder said. The report did not probe how to recover the revenue from consumers, he said.

Faced with rising debt and slowing tax revenue, the National Treasury is trying to reduce municipalities’ and State-owned companies’ reliance on government guarantees for debt funding and increase private investment in municipal infrastructure. The Treasury estimated R132-billion in spending on water and sanitation infrastructure in the three years to March 2019, it said in the 2016 Budget. This excludes grants and conditional loans.

About 16% of KwaZulu-Natal’s 11-million residents did not have access to piped water by 2015, while one in four people in the Eastern Cape were unserviced, the highest proportion in the country’s nine provinces, Statistics South Africa data show. As much as 63% of those living in some of the municipalities surveyed were affected by backlogs, Harichunder said.

Less than half of the spending on water was budgeted for, leaving a R385-billion funding gap, the national Department of Water Affairs said in 2013.

In 2015, South Africa suffered the worst drought since records started in 1904, decimating crops and livestock. The drought continued last year, forcing the country to become a net importer of maize, a staple that the country is the continent’s biggest producer of, for the first time in 2008.

KwaZulu-Natal’s dams were on average only 47% full because of the drought at the end of January, below the national average of 55%, the Department of Water Affairs and Sanitation said on its website.

Edited by Bloomberg

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