Addressing allegations

Following recent concerns raised by investors acting on behalf of bondholders in Umgeni Water, Minister of Water and Sanitation Nomvula Mokonyane directed that the department engage with representatives of the concerned parties including the Johannesburg Stock Exchange and as a result, an interim board will be announced shortly to oversee Umgeni Water in the interests of sound corporate governance and stability at the utility.

Minister Mokonyane announced on 27 September 2017 that she will be appointing an interim board at Umgeni Water to provide oversight on the entity led by the acting CE, Thami Hlongwa, pending the finalisation of a process for the appointment of a permanent board.

“I have presented a proposed interim board to Cabinet today,” said Mokonyane. “It is composed of persons with vast experience in the water sector and consisting of credible persons with the requisite financial, legal and management experience required at Umgeni Water.

“The interim board will be expected to meet as a matter of urgency to immediately attend to the corporate governance, operational and financial management matters at the utility, including the composition of an independent audit committee to oversee the finances at Umgeni Water.”

Mokonyane has further committed to expedite the appointment process of a fully-fledged board at Umgeni Water and will engage all relevant stakeholders on the process to ensure transparency and co-operation in the interests of Umgeni and the people of South Africa.

“Allegations made by the City Press [this week] of a possible R3-billion bailout [by treasury] for Umgeni Water are completely in-factual and void of any truth. The financial position of Umgeni Water remains positive and sustainable,” concluded Mokonyane.

Mokoyane was responding to allegations that treasury could be forced to bail out Umgeni Water after asset management company Futuregrowth was allegedly considering withdrawing bonds from the state utility.