Following the rejection of a presentation from the Department of Water and Sanitation and the South African Local Government Association (SALGA) on proposals for the 2020/21 water tariff increase, Rand water has raised concerns about its future sustainability.
This follows a joint meeting which included the Portfolio Committee on Human Settlements, Water and Sanitation and the Portfolio Committee on Cooperative Governance and Traditional Affairs (CoGTA.
Rand Water’s Media Ralations Manager Justice Mohale says, “Both Committees acknowledge that the bulk water tariff increases are required to ensure that water boards remain financially sustainable. They have also indicated that a ‘holistic’ solution is required. “Whilst mindful of the Committees concerns, Rand Water would like to emphasize that after adherence to all applicable legislation and after an extensive consultation process, its proposed tariff increase of 6.6 percent has the support of its municipal customers and stakeholders.”
Mohale states that Rand Water fully understands the importance of engaging the Committees on its consultation process with its customers and stakeholders on determining its tariff increase, and the advising them on the various factors that went into that process.
“Previously, at a seating of the Joint Portfolio Committee for Water and Sanitation on 2 June 2020, SALGA supported Rand Water’s proposed tariff increase of 6.6% and rejected higher proposed increases made by other boards. However, with the uncertainty that this matter now presents, Rand Water is now concerned of the significant future financial risk that it now faces.
“The utility will now have to prioritize its planned projects on the short to medium terms. This will in turn also have an impact on all the municipalities serviced by Rand Water, it will also curtail Rand Water’s ability to finance necessary future bulk water infrastructure maintenance programmes, as well as other essential CAPEX projects.” Mohale added that this would have a significant impact in Gauteng and in parts of the three other provinces in which Rand Water works.
