CHDM vote ends water contract
25-year deal to run its course in two months’ time
THE Chris Hani District Municipality (CHDM) has resolved that the 25-year contract between the local authority and Water and Sanitation Services South Africa (WSSA) will not be renewed.
The decision, taken during a special council meeting on Tuesday, comes only two months before the end of the contract.
The Rep recently queried what would happen at the end of the contract, with the response that no details would be divulged until council took a firm decision.
The WSSA concession contract was inherited by the former Lukhanji Municipality from the Queenstown Transitional Local Council.
CHDM is a water services authority which took over the function of water services provision from local municipalities in July 2014.
“By default the function was taken over from the then eight local municipalities with all water services assets, existing water services contracts . . . and local municipality's liabilities,” an agenda item indicated.
The terms and references of the contractual agreement were that WSSA would operate and maintain the water services infrastructure in Komani and later Mlungisi and Ezibeleni.
“Assets and staff would be handed over [to CHDM] at the expiry of the contract, inclusive of upgrades performed as entailed in the contract. “A fee which escalated over the years to a current cost of around R4.6-million every month is currently paid to service the contract by the district municipality ever since 2003,” the item said.
The district authority had to ensure it was ready to take over the operations and workers from WSSA with minimum disturbance of the service.
“(CHDM) is currently busy with the process of amalgamation and placement of staff from local municipalities against the current organogram and (it) is expected to be finalised between October and December 2017 respectively ( sic).”
It was, however, indicated that CHDM was not ready to take over the service unless it considered one of four options. While council was in agreement that the contract with WSSA would not be renewed, the UDM's Zanemvula Deliwe and DA's Malibongwe Xhelisilo opposed the option which indicated that the service should be provided through a management arrangement. “This option entails a situation where the district municipality enters into a new contract with WSSA for management services for 12 to 18 months,” the item said. This would mean upon expiry of the contract, all workers' systems and assets would be under the control of CHDM with WSSA only providing management activities with minimum staff of three to five people. This option, the item said, would be costeffective compared with the current arrangement and would ensure a smooth transition. It would create a stable labour environment and ensure the municipality filled its critical positions which would enable CHDM to take over in about six months.
Deliwe and Xhelisilo initially favoured another option, which required the municipality to negotiate with WSSA supervisory staff based on skills and experience.
This option, executive mayor Kholiswa Vimbayo said, would be costly and could create labour disputes.
“If we approach them as individuals then we stand a chance of them wanting to be paid a lot of money, which could be more than what is earned by infrastructure development director Makhaya Dungu, to whom they will be reporting,” she said.
Council finally agreed on the option to enter into a contract for management services before it was taken to a vote.