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South African Association of Water Utilities

South African Association of Water Utilities. SAAWU. PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY. SAAWU VIEWS ON THE IMPLEMENTATION OF THE STRATEGIC FRAMEWORK FOR WATER SERVICES 18 February 2004. South African Association of Water Utilities. SAAWU.

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South African Association of Water Utilities

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  1. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY SAAWU VIEWS ON THE IMPLEMENTATION OF THE STRATEGIC FRAMEWORK FOR WATER SERVICES 18 February 2004

  2. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • Presentation Structure • Introduction to SAAWU • Strategic relevance of water utilities • SAAWU involvement in the development of and its support for the Strategic Framework for Water Services • SAAWU Views on key elements of the Strategic Framework for Water Services • The challenges of interim initiatives • SAAWU approach and commitments • Conclusion

  3. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY INTRODUCTION TO SAAWU The South African Association of Water Utilities is a Section 21 Company that was established in March 2001. The main objective of SAAWU is to build a united association of public sector water utilities which co-ordinates, mobilises and uses its collective capacity to optimise the ability of municipal authorities to provide sustainable, efficient and affordable water services to all the people of South Africa.

  4. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY SAAWU MEMBERS (22 Organisations) Albany Coast Water . Amatola Water. Bloem Water . Bushbuck Ridge Water Cape Metro Council . Sedibeng Water Ikangala Water . Kalahari East/West Water Boegoeberg Water Lepelle Northern Water Magalies Water . Mhlathuze Water Midvaal Water . Namakwa Water Botshelo Water . Overberg Water Rand Water . Uthukela Water Umgeni Water . Johannesburg Water NCWSTI . TCTA

  5. Limpopo Province Midvaal Water

  6. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • Strategic Relevance of Water Utilities • The key strategic relevance of theexisting water utilities in South Africa must be recognised and factored into all initiatives taken on the implementation of the Strategic Framework for Water Services. This strategic relevance is directly related to all forms of socio-economic development in that: • Approximately 80% of the Gross Domestic Product of South Africa (GDP) takes place in the service areas of water utilities. • Approximately 60% of the population of South Africa is resident in the service areas of water utilities

  7. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY The Strategic Framework for Water Services (SFfWS) SAAWU played a leading role in promoting the need for a review of policy for the water services sector SAAWU representatives were directly involved in the process of drafting the SFfWS through the core team approach and bilateral interactions with DWAF and other key role players SAAWU would again like to complement DWAF on the consultative and integrated approach taken in the drafting of the SFfWS SAAWU and its members are fully supportive of the SFfWS and are fully committed to its effective implementation The Cape Town Commitment signed by SAAWU members and handed to the Minister of Water Affairs and Forestry

  8. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • SAAWU views on the Strategic Framework for Water Services • While all the sections of the SFfWS are important the SAAWU views on the following critical sections will be briefly addressed in this presentation • Introduction • Sector Vision Goals and Targets • The Institutional Framework • The financial Framework • The Planning Framework • National Norms and Standards • The Regulatory Framework • Support and Monitoring Framework

  9. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY Sector Goals and Targets SAAWU and its member organisations are fully committed to playing a leadership role and working constructively with all sector stakeholders and role-players to ensure that the sector goals and targets as set out in the SFfWS are met.

  10. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • The Institutional Framework • SAAWU approach and ethos • “Institutional reform must ensure that the best possible institutional arrangements are created to support municipalities to accelerate and improve water service delivery” • SAAWU is a leading participant in the National task team on institutional reform • SAAWU is in agreement and supports the objectives for and principles for institutional reform as set out in the SFfWS • SAAWU is a leading participant in the development of a strategy for institutional reform that is currently being developed for submission in June 2004

  11. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY The Institutional Framework • Must be done in accordance with the objectives and principles as set out in the SFfWS and the strategy to be submitted to cabinet in June 2004. • The process will be complex and take time to complete. • Requires strong political will and commitment from key role players ( In particular DWAF) • Outcomes must support broad socio-economic development needs

  12. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY The Institutional Framework • Regional interests for water services must transcend local interests ( DWAF role as sector leader to ensure this) • Structural arrangements must recognise availability of resources and logical arrangements of infrastructure • Boundaries of regional entities should be informed by water management areas and catchments in the first instance and political boundaries thereafter

  13. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • Institutional Framework (Cont) • Must build on existing institutional capacity not fragment. • Must create viable and sustainable institutions • Focus should be on autonomous entities • Effective utilisation of capacity, skills and resources • Ownership of assets • Accountability and governance • ALL DECISIONS ON INSTITUTIONAL ARRANGEMENTS MUST BE UNDERPINNED BY “WHAT IS IN THE BEST INTERESTS OF THE CONSUMER AND CITIZEN”

  14. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • Institutional Framework (cont) • Regulation (Local) • Recognition of need for local level regulation by the WSA (through balanced and fair contracts) • Local regulation must be balanced with regional interests where there is supply to more than one municipality • Strategic Relevance • The strategic relevance of the water services sector must be recognised (don’t change for the sake of change) • Institutional reform requires pragmatic approach, strong collaboration and resolute execution • Quick wins are critical

  15. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • Financial Framework • SAAWU acknowledges the requirement to direct all forms of funding for services via municipal authorities (DORA) by July 2005 • A number of water boards are operating water supply schemes on behalf of DWAF via a range of agreements and sizable populations are being serviced via these arrangements • There is a need for a strategy to support the withdrawal of the funding by DWAF in order to ensure service delivery is not jeopardized • SAAWU has proposed to DWAF that a multi stakeholder strategy be developed as a matter of urgency

  16. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • Regulation (National) • The SAAWU view has always been that a strong and ultimately independent regulatory regime is a critical requirement • Effective regulation must take place at all business interfaces in the water service supply chain (raw water/bulk/reticulation and waste management- discharge) • The role of DWAF as the sector regulator in the interim is accepted due to the dynamic changes facing the sector in the short to medium term • Regulatory capacity of DWAF is a concern • Multi Regulator risk (DWAF, DPLG, NT)

  17. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • Challenges of Interim Arrangements • A key challenge will be to have a strategy/s in place to deal with interim arrangements and initiatives while the process of institutional reform unfolds and the capacity of DWAF as a regulator is established. This strategy should address the following issues: • Services must still be delivered, improved and extended • Transfer of DWAF assets and phasing out of subsidies to water utilities • Section 78 processes for water service provider options cannot be taken in isolation of the institutional reform process where there is a potential regional impact • Securing appropriate WSP contracts

  18. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • Challenges of Interim Arrangements (Cont) • Current activities must be managed in a manner that ensures full cost recovery and institutional viability • Planned initiatives and infrastructure development (where investments need to be supported by appropriate contractual agreements) must be appropriate and relevant • Decisions taken by municipalities around water service delivery options that impact on regional interests must be subject to up front evaluation and approval • Water utilities must be able to demonstrate that they are efficient and effective water service providers who are customer orientated

  19. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • Challenges of Interim Arrangements (Cont) • Dealing with poorly capacitated and resourced municipalities and water utilities • Extending free basic services in a viable and sustainable manner during this period of transition • Building the capacity/capability of the water utility to respond to municipal needs in a viable manner

  20. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • SAAWU Approach/Commitments • The SAAWU approach to the issues outlined in the presentation is underpinned by: • Active engagement with national government agencies and stakeholders on all issues impacting on the water services sector (as mandated by the general membership) • Active engagement with national government agencies and stakeholders on the strategy and process of institutional reform (Through representation on the National Task Team on institutional reform)

  21. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • SAAWU Approach/Commitments • Implementation of the Model Bulk Water Services Agreementagreed between SAAWU and SALGA(MBWSA) with all municipal customers • Agreeing with SALGA and DWAF the sections of the MBWSA that are to be included into the regulations to the WSA • Recognition of the role of municipalities as the WSA (Executive authority for water services)

  22. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY • SAAWU Approach/Commitments • Acting in support of municipal water service delivery objectives • Supporting regional objectives and national water service delivery objectives/targets. • Active engagement with SALGA on sector issues through the SALGA /SAAWU Working Group

  23. South African Association of Water Utilities SAAWU PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY Conclusion • SAAWU and its member organisations are in full support of the Strategic Framework for Water services and are committed to Playing a leading and constructive role in: • Addressing the challenges of the implementation of the Strategic Framework for Water Services (as per the SAAWU Cape Town Commitment) • Developing a strategy for institutional reform that will clearly and rationally set out the framework, principles and guidelines that will direct such reform. • Engaging in the process of institutional reformin accordance with the agreed framework, principles and guidelines

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