Big unpaid municipal debts stem from institutional failures

Water and Sanitation Minister Nomvula Mokonyane has published a list of 30 municipalities that are indebted to her department for bulk water purchases, to the tune of R10bn.

Mokonyane has vowed to “throttle” water to the errant municipalities as a last resort.

However, access to water is a constitutional right and disconnection may therefore prompt a constitutional challenge. And, unlike electricity, it is not that easy to flick a switch to turn off the taps.

However, what this episode does present is a series of institutional failures that account for these large debts. The water services system is complicated by multiple actors — the department, water boards, district municipalities and local municipalities.

In some areas, the districts provide the water distribution function. In others, the local municipalities do.

That is immaterial to household customers though, and nor should we be concerned with which sphere of local government has “powers” and authority to do which function.

For most of us, government is simply government — one entity. When the taps are throttled and the water flow becomes a dribble, it is “the government” that people consider to be at fault, without concern over any intergovernmental spat over unpaid debts.

In such intergovernmental fights and co-ordination failures the primary asset (water), is often a playground for deeper political and governance issues.

LEAKING SKILLS

Take for instance one of the water boards mentioned in the list; Amatole Water Board. The board serves many municipalities in the Eastern Cape, reticulating water from dams to treatment works and households in several struggling municipalities.

Although charged with such an important function, the board is leaking skills, is an arena of industrial strife and has extensive delays in the execution of its capital projects. Water provision is characterised by multiple interrelated processes and a lot can go wrong.

Most common is the failure to spend capital budgets timeously and repair ageing infrastructure. This all before we even start to talk about consumers who do not pay their utility bills.

In many cases, the “billing capacity” is weak, or altogether absent. This is compounded by tariff setting that does not reflect the actual cost of providing the services, especially to high-lying areas, where pumping costs have to be taken into consideration.

A government technical advisory centre report suggests that bulk purchases — the money that Mokonyane is fighting for — account for 50% of municipal water services costs.

High water losses (between 4.4% and 28%), and low repair and maintenance expenditure mean income falls short of what is needed to improve and maintain assets.

PERFECT STORM

It is clear that the performance of the underlying infrastructure and payment profiles of municipalities are only monitored when a crisis occurs. Without such monitoring and evaluation municipalities and water boards inevitably find themselves indebted to Mokonyane’s department, not only for water bought but for water lost to the ground (in some cases irrecoverably so), and water provided to households where billing doesn’t occur, even when residents can pay.

WATER PROVISION IS CHARACTERISED BY MULTIPLE INTERRELATED PROCESSES AND A LOT CAN GO WRONG

Ironically, it makes for a perfect storm, where the confluence of drought conditions, bad service quality, aged infrastructure (and weak capital spending) and weak billing systems compromise the ability of municipalities to provide water services sustainably.

It is a storm that takes us back to the drawing board to ask about the viability of the municipal provisioning system in the face of so many institutional and co-ordination failures.

While we ask, every drop coming from the taps in places such as Emalahleni in Mpumalanga is closely watched by those who fear it may be a long time before the dripping might return to full flow.