Private sector partnerships will help keep SA’s taps and pipes open

Infrastructure investment in the water and sanitation sector needs a helping hand from a variety of role players

Afew days ago, we made a groundbreaking announcement about our plans with the Water Research Commission to host a water infrastructure investment summit. Our aim is to convene the key role players in the public sector, business and professionals in the water sector to facilitate a conversation and programme of action that aims to shift the water and sanitation sector investment landscape. Ultimately, the summit would facilitate an enabling environment for investment and inclusive growth opportunities in the sector.

In true South African fashion, this announcement was met with scepticism from some quarters, especially in the media and a few professional and private sector players. This unfortunate scepticism is premised on an old charge that the government is merely paying lip service to the involvement of the private sector in water infrastructure investment initiatives. In fact, a startling claim has even emerged that this constitutes a policy shift in the space of water management, where the government seeks the involvement of the private sector. Nothing could be further from the truth.

When the government launched the National Development Plan (NDP) in 2012, one of the key pillars it emphasised for the achievement of Vision 2030 was the need to develop effective partnerships between public and private sector players, especially on infrastructure-related projects. Even before the advent of the NDP, the state had an illustrious history of co-operation with the private sector.

A few initiatives that have contributed towards collaboration and relationship-building between the government and the private sector are the Expanded Public Works Programme, the National Skills Development Strategy and the Jobs Fund, but there are many more. The government and private sector have accepted the challenge that we need to work harder together to unblock the legislative and regulatory constraints that make these partnerships difficult to achieve. We have already laid the foundation for this work in a number of areas in the government strategic infrastructure projects.

For the water sector, we can accept that the majority of consumers are served by publicly owned and operated utilities. It is also true that public finance remains the predominant means of funding the expansion of water and sanitation services. This, however, does not discount the role of public-private partnerships for the provision and financing of these water supply and sanitation infrastructure programmes.

This summit comes at a time when numerous sector role players are looking at the issue of the investment climate for water and sanitation in the light of continuing service delivery needs, drought and flood challenges and ageing infrastructure. This is also driven by policy imperatives emerging from the development of the next National Water Resources and Sanitation Strategy and the associated development of the National Water and Sanitation Master Plan.

Through this Water Infrastructure Investment Summit and Stewardship Initiative, we must together with the private sector drive a co-ordinated, strategy-focused approach.

Guided by the imperatives of the NDP, this co-ordinated approach should be interdependent and interrelated to other departments at national level, other spheres of government, the private sector, civil society and to the people of SA as a whole. The approach must also ensure we provide a sustainable and holistic value chain of water supply, from source to tap and from tap back to source.

It is undeniable that water security is one of the biggest challenges facing SA and the world in the 21st century. It presents a profound challenge to our social wellbeing and our economic growth.

This could get rapidly worse as our supply contracts and demand escalates due to growth, urbanisation, unsustainable use, degradation of wetlands, water losses and a decrease in rainfall due to climate change.

Based on demand projections, by 2030 the water deficit could be between 2.7-billion and 3.8-billion cubic metres, a gap of about 17%.

With this stark reality, we cannot afford to delay the development of new water sources lest we exacerbate the looming water deficit and face serious challenges with regard to water for household use, food production, energy, sustaining ecosystems and economic growth.

To close the water gap in SA we have to insist on constructive dialogue and collaboration with all stakeholders in the water value chain.

By virtue of its pivotal role on the socioeconomic landscape, the South African water sector has been dominated by large infrastructure projects and investments. Given the opportunities and challenges the water sector needs to respond to, it is vital to stimulate a diverse and capable water sector business and investment landscape.

We are encouraged by the fact that a number of initiatives are already under way to respond to understanding the gap in water infrastructure investment, but there is a greater need to understand the actual investment gap that exists in the water and sanitation space.

Current estimates over a 10-year period vary from R330bn (if only focusing on new infrastructure needs and investments) to more than R1-trillion if all infrastructure maintenance, upgrades and planned initiatives are taken into account. This means the only way to cost this clearly is to have a clear plan and set of priorities and an associated investment strategy.

Investment decisions and effective risk management play a critical role in developing strategic responses to growing an inclusive economy, decreasing the water investment deficit, thereby ensuring water and sanitation for all South Africans.

The South African Institution of Civil Engineers recently released the 2017 South African Infrastructure Report Card. When zooming in on water (bulk water resources, supply in major urban areas and supply in other areas), the water sector scores between a D- and C+, with no upward trend between 2011 and 2017.

When focusing on waste water and sanitation for urban areas, we score a C- and for other areas SA scores an E, with no upward trend between 2011 and 2017.

This is a clear indication that we have an uphill battle implementing our infrastructure programme and that public-private partnerships are vital to respond to these challenges.