THE PORTFOLIO COMMITTEE OF WATER AFFAIRS AND FORESTRY (NATIONAL ASSEMBLY) UNDERTOOK A PROVINCIAL STUDY TOUR TO EASTERN CAPE AND KWAZULU-NATAL FROM 3 TO 7 FEBRUARY 2003 AND WANT TO REPORT AS FOLLOWS:


A. BACKGROUND OF THE VISIT


1.Introduction

A multi-party delegation from the Portfolio Committee of Water Affairs and Forestry (National Assembly) undertook provincial visits to the Eastern Cape and KwaZulu-Natal from 3 to 7 February 2003 with the following mandates:

2.Objectives of the Visit

The Committee unanimously agreed that a multi-party delegation undertake the provincial visits to Eastern Cape and KwaZulu-Natal, to focus attention, oversight and monitoring to the following issues:

(a) The Implementation of Free Basic Water Policy
(b) Delivery of Water Services
(c) Cholera Intervention
(d) Progress on Forestry Restructuring

3.Delegations

The multi-party delegation under the leadership of the Chairperson Ms.B.P.Sonjica, unanimously agreed to divide into two groups for the Eastern Cape part of the visit and the delegations were constituted as follows:

Group A to Eastern Cape:

Ms.B.P.Sonjica – ANC (Chairperson and Leader of the delegation), Mrs.R.A.Ndzanga – ANC, Mr.M.J.Phala –ANC, Mr.Z.Kati – ANC, Mr.J.D.Arendse – ANC, Mr.E.Sigwela – ANC, Mr.S.Simmons – NNP, Mr.M.Msila – ANC Researcher and Ms.N.C.Manjei (Committee Secretary). This group visited the O.R.Thambo District.

Group B to Eastern Cape

Mr.J.F.van Wyk – ANC (Leader of delegation), Mr.M.M.Masala – ANC, Mrs.T.E.Leshiva – ANC, Mr.M.L.Ngwenya – ANC, Mr.C.J.Maluleke-Hlaneki – ANC, Mr.S.Sibiya – IFP and Mrs.M.Mercuur (Secretary to Chairperson). This group visited the Amatola District.


KwaZulu-Natal Delegation:

Ms.B.P.Sonjica(Leader of the delegation), Mr.J.D.Arendse, Mr.J.F.van Wyk, Mrs.T.E.Leshiva, Mrs.R.A.Ndzanga, Mrs.M.L.Ngwenya, Mr.M.J.Phala,Mr.Z.Kati, Mr.C.J.Maluleke-Hlaneki, Mr.E.Sigwela, Mr.S.Simmons, Ms.N.C.Manjei (Committee Secretary), Mr.M.Msila (ANC Researcher) and Mrs.M.Mercuur (Secretary to Chairperson). Only four members could visit Umgeni water i.e. Sonjica, Arendse, leshiva and Van Wyk.

The delegation were accompanied by officials from Department of Water Affairs and Forestry, Amatola and Umgeni Water Boards, Councilors and senior officials from the District and Local Municipalities.
.
4.The Programme

(a) Visit to Amatola Water Board, Eastern Cape – 3-4 February 2003
(b) Visit to O.R.Thambo District Municipality, Eastern Cape – 3-5 February 2003
(c) Forestry Indaba, KwaZulu-Natal – 6 February 2003
(d) Visit to Umgeni Water Board, KwaZulu-Natal – 7 February 2003

B. FINDINGS

1.VISIT TO AMATOLA WATER BOARD, EASTERN CAPE

This visit start with a briefing for the whole delegation by DWAF and Amatola Water Board at the Eastern Cape Development Corporation in East London, after which the delegation split into two groups as it is explained earlier in the report.

1.1 Briefing by DWAF and Amatola Water Board

1.1.1 Regional Water Services Overview – Mr.A.Wilson, Consultant on National Water Sector Development

Eastern Cape Water Services Multi Annual Action Plan (MAAP)

MAAP and the provincial Masibambane initiative are used to support sector institutional arrangements, strategic formulation and policy development so as to ensure co-ordination of provincial efforts by all major sector players, including various government departments.

These efforts include the intervention of some 32 supporting strategies aimed at ensuring an integrated inter-sectoral approach to the reduction of sanitation and water backlogs. Critical paradigm shifts had begun to unfold due to the transition in the role played by DWAF in the sector and also the wider changes in local government services roles and responsibilities. In response to these changes steps were being taken to constantly develop and refine communication structures to ensure fullest possible involvement and benefit for key such as district municipalities.

The communication and joint effort in the area of water services development was being advanced via the work of the Integrated Water Services management Forum but that such interaction had demanded extensive time and effort commitment by all of the parties. Also, much work need to be done to build the capacity needed to extent and accelerate services delivery to strive towards national targets.

1.1.2. Briefing by Amatola Water Board

Background – Mr.M.Jonas, Chairperson of Board

The primary activity of Amatola is the supply of bulk water to the Amatole District Municipality, Buffalo City Municipality, Nkonkobe Municipality, Ngqushwa Municipality, Amahlati Municipality and industrial and agricultural customers.

Amatola Water was established in April 1997 and operational control was transferred in July 1998. Their vision is to be a service provider of choice for local government in the Eastern Cape, delivering a full range of services to improve the quality of people’s lives.

The bulk and reticulation water services comprise of:

- Operation and maintenance of 26 dams for DWAF;
- Bulk water treatment, distribution and storage in 14 water treatment works;
- Water reticulation management services to end customer;
-Sewage treatment – expertise available but not running any STW’s at the moment;
- IT Project Management/Billing Systems; and
- Support services for community-based organizations.

Summary of Strategic Issues – Mr.S.Kondlo, Chief Executive Officer

Amatola commenced its operations in an area of 11 000 square kilometers, but had subsequently seen its gazetted services region quadruple in size. The Board had inherited infrastructure that had been transferred into its operational control by DWAF but that was in need of substantial maintenance and refurbishment. The Board had therefore commenced its business activity with operational systems that were incomplete or otherwise deficient.

Among challenges faced in the provision of services were the wide disparities between urban and rural components of the region, with the latter served in some places by small water supply schemes which could not be operated economically without cross subsidization by larger schemes.

These factors constrained the Board in its efforts to convert all its services into comprehensive and cost-efficient water services. However, a number of successes had been realized in the short history of the Amatola. This includes the extension of potable water supply to new rural communities in a programme that is ongoing and the financial turnaround of various deficit-making operations. Also achieved was a substantial reduction in outstanding debtor’s days on customer accounts following historically high levels of payment defaulting. The board had also invested to improve and better integrate its business systems and was now benchmarking its services against other water utilities to ensure a high level of service proficiency and cost effectiveness.

A key factor in the board’s progress had been its intensive efforts to demonstrate its legitimacy to its stakeholder institutions, including via the negotiation and conclusion of formal, long-term supply agreements with all major customer municipalities. Furthermore, agreements and memoranda of understanding were also being canvassed with DWAF and SALGA (Eastern Cape).

Financial Performance of Amatola Water

Worthwhile advances have been made, but the water board had encountered various fundamental setbacks that had served to undermine its overall financial performance. These were a cause of concern and existed as matters which Amatola was urgently seeking policy support and assistance from DWAF and from national government, via the Portfolio Committee, to resolve so as not to jeopardize current and future service provision.

Amatola’s progress towards financial viability as a new business entity had been hindered by its obligation to absorb substantial increases in input costs imposed on the water Board. This includes imported inflationary cost relating to water treatment chemicals, increases in electricity tariffs and escalation in raw water charges. Further financial difficulty was encountered as a result of non-receipt of state financial support that had been anticipated. In terms of the agreement under which Amatola had been founded, sate financial commitments totaling some R53m over its first five years of operation had been expected. In the event, much of this was not applied to the Water Board, which instead received just R34,06m in transfer payment subsidy due to the manner in which the subsidy support was calculated and applied.

The financial position of the Board had been further worsened by an accrual in unpaid raw water charges of R22,71m claimed by DWAF as a result of its application of disputed raw water tariffs for certain schemes and DWAF’s subsequent decision to turn a concession application by Amatola Water for writing off the shortfall that the Water Board passed on in its final sales tariffs to municipalities.

Expectations of State Support

The expectations of State support had also been disappointing as a result of notification by DWAF of a termination in capital funding by government towards the cost of necessary asset refurbishments undertaken by the new water board. This place Amatola in the position where it was forced to self-fund the most essential aspects of its asset refurbishment programme from its own working capital. An amount of some R26m had been expended.

Accrued Raw Water Debt

The accrued raw water debt, normal annual adjustments in DWAF’s raw water charges had elevated this cost element to the point where it now constituted some 22% of the final tariffs applied by the water board to its customers. Such charges had increased at an average of 18% over the past two years and the average raw water tariff currently being charged to Amatola Water was set at the second highest tariff level applicable to all water boards in the country.

This state of affairs was not socially or developmentally justified given the immense services backlogs present in the Eastern cape, coupled with the severe economic constraints under which local municipalities operate. The sharp increase in this input cost to Amatola Water’s total cost of services provision was also a factor behind the water board write-off of R9m in customer bad debt.

In finalizing the status of its account with DWAF, the department had furthermore determined that the consequences of its rulings on transfer subsidies was that there had been excess transfer payments paid to Amatola Water over the five-year start-up period. DWAF therefore required that the Water Board be called upon to honour a refund claim of R10,4m in transfer subsidy paid to it in previous years.

The combined and accrued financial burden of the department’s various claims and rejection of the concession applications by the water board had had a marked impact on cash flows and on the future planning capabilities of the water board. It was essential that these hindrances, to the realization of the Board’s long-term, legitimate social and services goals should be satisfactorily resolved by the parties concerned.

1.2 Visit to Sandile Dam and Sandile Water Treatment Works

The Sandile Dam lies in the Keiskamma River Valley and consists of a ground wall and a concrete spillway. Both the dam and its nearby water treatment works are situated between the towns of Keiskammahoek and Middledrift.

The dam was built in 1985 and supply treated water for domestic purposes as well as providing water supply to the Zanyakwe and other irrigation schemes in the Keiskamma River Valley. The dam also supply water to the Graighead Pump Station on the banks of the Keiskamma River, and this water is, in turn, pumped over an escarpment to the adjacent Peddie Regional Supply Scheme.

Sandile is one of the largest dams managed by Amatola water. Its capacity is 30,9 million cubic meters while the Sandile Water Treatment Works can generate up to 18 mega-liters per day. The plant is currently producing and supplying an average of 16-17 mega-liters per day.

The Water treatment Works supplies bulk-purified water to the industrial town of Dimbaza, to Middledrift and approximately 105 rural villages, benefiting a total population of about 163 000 people. Currently, 90 of the villages receive water supply via the Sandile scheme.

Water Services Challenges

By virtue of its geographic extent and its developed pipeline network, the Sandile Supply Scheme includes a potentially substantial rural village reticulation component. Actual, economically sustainable supply and services extension to the Sandile Scheme’s customer base has, however, became constraint by a number of factors in recent years.

A depression in economic activity in the entire region, in part due to a contraction in industrial activity in the Dimbaza industrial node plus contraction in agriculture. Underlying the latter has been the failure of irrigation ventures, many of which now require substantial reinvestment and rehabilitation. Amatola Water is together with several other role players involve in an Irrigation Action Committee that reviews the current and future irrigation opportunities, in an attempt to rehabilitate the inactive irrigation schemes, with the view to restore employment, economic production and optimum use of regional resources.

Sandile Scheme is also among a number of schemes where the final cost of water supplied has been driven sharply higher in recent years due, primarily, to substantial increases in raw water charges levied by DWAF. For the 2004 year, the tariff for this major cost input increased by 23,6%. This comes in the wake of a 19 % increase in raw water charges in the previous year, with cost escalations in both years far outstripping the consumer inflation rate. These developments have served to simply compound the financial difficulties experienced by municipalities served by the Sandile Scheme.

1.3 Visit to Cwaru Village Sanitation Project

The Delegation, were addressed by members of the Community Sanitation Committee and a representative of Mvula Trust, the implementing agent. The Project started in November 1999, and will be completed in phases. In 2000 19 toilets were constructed, 23 in 2001, 31 in 2002. Because of the slow progress only 71 toilets were built.

The community participation in the project was satisfactory. Local builders were trained to build the toilets. The project also includes a health and hygiene awareness programme. Some households could not participate because the subsidy is not enough to build the toilet and they could not afford the own contribution. The increased in the subsidy, although still not enough, contributed to improved community interest and more people submitted applications for toilets.

There are communal taps in place in the village, but residents only receive water for 2 hours per day. Amatola is currently busy with the upgrading of the reticulations network to replace the older pipelines.

1.4 Visit to Illegal Water Connections in Zihlaleni Village

Widespread incidents of illegal water connections give rise to volumes of unaccounted for water usage and so detract from the financial viability of existing and/or new water schemes.

One of the underlying reasons for the illegal connections is that village residents has resorted to tapping water from pipelines to establish food gardens near their homes to compensate for the loss of income and loss of nutrition previously derived via industrial and agricultural activities.

Various practical problems created by these illegal connections, such as water wastage, damage to infrastructure and a heightened need to attend to system repairs, with attendant costs. Connections onto pipelines supplying reservoirs also result in off-take of water creating reduced pressure and/or reduced water availability in the system. The illegal connections therefore, invariably, have a negative impact on the quality of service that can be provided to legal water users.

Sandile Water Supply Scheme has been particularly affected by a multiplicity of illegal connections of a potentially serious nature on the bulk network pipelines in recent times. An assessment has identified 43 illegal connections affecting the supply of water within some 12 villages and the elimination of these problems has proved to be extremely difficult.

Amatola water maintains a formal policy on illegal connections and seeks to interact closely with municipalities to identify and respond to all illegal connections as rapidly as possible. Community facilitation services are used to disseminate education and to promote responsible water usage and community structures and encourage to assists with the identification of local problems areas. This effort is undertaken with the knowledge and involvement of Ward Councilors.

1.5 Visit to Krwakrwa Village

The meeting attended by members of the Gaga-Tyume Project steering Committee, local councilors and a ward councilor and members of the West Victoria-East Community. A councilor from the Amatole District Municipality was also present.

The project is called the Kula Development Water project and it aimed to supply 38 villages with purified water. The business plans was signed in 1996. To date 17 villages have access to water.

The community members pay R10-00 per household to buy water from Amatola. Because some community members do not pay, this caused conflict within the community. Misunderstanding about the promise of free basic water is contributing to a poor payment culture. Water is provided to the villages by the use of green tanks, communities are reluctant to use the water services. Most of them prefer to use alternative source that is not purified. Free basic water is not yet supplied in these villages.

West Victoria-East

The Ward Councilor explained that this water project plans to supply 19 villages west of Alice with water. Although the project was supposed to have started in 2002, it did not start to date. Amatole District municipality is the implementation agent. The community is now told that there is no money for the project and that it would be linked to the Beaconsfield Water Supply Scheme.

The District Councilor present explained that the project is funded by DWAF and that the District Municipality is the implementing agent. To date the following progress have been made:

- Consulting engineers have been appointed and they are busy with feasibility plans.
- A Community Project Steering Committee was established.
- Designs and business plans are completed.
- Currently the District Municipality is finalizing the allocation of the tender.
- The project will start after April 2003.

The total costs of the project is R12m, of which R1,5m has been paid in 2001/02 and R3,8m in 2002/03. One the reasons with the slow progress are the problem of delays in transfer of funds by DWAF.

1.6 Briefing on the Cholera Outbreak in the Eastern Cape

Mr.J.Potloane, Deputy Director-General of DWAF, and Dr.D.Goldberg, Political Advisor to the Minister of Water Affairs and Forestry, were also present at this briefing by DWAF.

1.6.1 Cholera Outbreak Report

There were 607 reported cases and 9 deaths. These cases were all from five local authorities in the O.R.Thambo District Municipality. The reported cases were as follows:

- Mhlontlo – 351 cases from 57 villages and 6 of these villages were accountable for 268 cases;
- King Sabata Dalindyebo – 223 cases and from these 5 villages are accountable for 142 cases;
- Port St Johns – 3 cases from 2 villages;
- Nyandeni – 17 cases from 15 villages;
- Quakeni – 13 cases from 3 villages.

1.6.2 Action taken by DWAF

In January 2003 the Department approved R44m for Cholera Intervention Programmes. In 2002 O.R.Thambo District Municipality had commenced with the work using bridging finances. The work includes health and hygiene training, construction of 27 000 toilets and rudimentary water resources in the form of hand pump boreholes and spring protection. This was aimed to serve a population of 200 000 people.

The O.R.Thambo District Municipality has already submitted a cholera intervention plan for 2003 to DWAF and R16,2m have been requested to assist those new areas affected. These funds will be used for health and hygiene training, distribution of jik disinfectants to affected communities and the construction of 631 toilets. DWAF has already supplied 500 dozen bottles of jik/bleach to O.R.Thambo District Municipality with health and hygiene training in affected communities.

1.6.3 WASH Campaign Update

As this is a school based communication campaign, all the materials such as posters, stickers and pamphlets have been supplied to schools, clinics and general and district hospitals. Some materials will be given to O.R.Thambo District Municipality and this district is to allow accessibility and to ensure the availability of materials according to needs.

WASH Campaign Radio

Awareness programmes is broadcasted by the communications manager of DWAF at the community radio station at Umhlobo Wenene during the Women’s afternoon programme. Approxiamately 400 000 people are reached during the programme.

WASH Campaign Business Proposal

A business plan to the value of R150 000 was submitted to the Department is awaiting approval. The proposal aims to address councilors from each District Municipality and O.R.Thambo Disaster Management – essentially strategically identified delegations.

WASH Advertising Campaign – Taxi Routes

The research project to be outsourced must establish what the attitudes towards health and hygiene sanitation is.It should also identify sources of information and the impact of the mass media campaign over the past two years among those earning between R200 and R1200 per month.

Billboards

This campaign will be aimed at water treatment, hand washing and toilets(VIP’s) on 12 and 48 landscape sheet in identified priority sites an the Eastern Cape. These billboards also need to serve in the broad cholera prevention campaign.

1.6.4 Management of the Cholera Outbreak

The health and hygiene educators were within DWAF sanitation programmes were sent to the affected areas and now are busy working on the cholera message. Several DWAF officials were called from leave and a team was sent out to inform the headmen of the dangers and actions to be taken to safeguard themselves and its people from the disease. The jik were distributed throughout the area. The O.R.Thambo District Municipality arranged water tanks into the affected villages for water supply.


2. VISIT TO O.R.THAMBO DISTRICT MUNICIPALITY, EASTERN CAPE

2.1 Briefing on O.R.Thambo Water Services

2.1.1 Background

O.R.Thambo District Municipality is divided into the following seven local municipalities: Mbizana, Qaukeni, Port St Johns, Mhontlo, Nyandeni and King Sabata Dalindyebo. The estimated population is 1 740 664, with 382 428 households living in both urban areas and rural villages.

2.1.2 Backlogs

The majority of the people residing in the district, do not have access to potable water and proper sanitation services and can’t afford to pay for water services.

Most of the municipalities have cash flow problems, overloaded infrastructure in need of repair and maintenance. The institutional capacity is unable to implement large-scale infrastructure without external assistance.

Out of the ten urban areas within the seven municipalities only four are either fully or partially served by waterborne sanitation systems. The rural areas generally depend on informal pit latrines where at least 91,4% of the population has no formal sanitation services. This constitutes approximately 303 960 households in the district

When the District Municipality took office in January 2001, there were no by-laws related to water. They started with the process of institutional development and received a grant from DPLG to fund the institution to redesign the whole organization and its policies. They embarked on the preparation of a water Services Development Plan to address the backlog on water and sanitation. There were also working groups that focusing on by-laws, infrastructure policies and institutional arrangements for water services.

There were also delays with the issuing of water extraction permits by DWAF. These problems were raised with the Minister and things has improved.v

2.1.3 Status of Funds to be transferred by DWAF to O.R.Thambo District Municipality

Sanitation

There are 45 sanitation projects with this District Municipality as implementing agent. R292m was budgeted for these projects but only R2,3 m is being transferred to the Municipality in the 2002/03 financial year.

Water

There 49 projects with the District Municipality as implementing agent. A total of R25,9m was budgeted for but only R1,5m is being transferred to the District Municipality by the Department in the 2002/03 financial year.

Problems with the Transfer of Funds

The District Municipality has however, proceeded to implement critical projects and has used funds to a total of R6,1m for water and R5,7m for sanitation from its own coffers. The biggest concern is that even on approval of business plans by DWAF, the District Municipality must further motivate for the approved funds to to be transferred to its coffers.
DWAF does not transfer funds after the business plans has been approved. On those approved there must be a fund request completed. Funds are on a sliding scale basis, when there are delays in the fund transfer, the allocation decreases. The delays result in reduction in allocations and non-transfer of funds.

Issues of delays and transfer of funds from DWAF to the District Municipality is seen as the biggest problematic areas. These problems had been discussed with Departmental officials in numerous meetings but there is no improvement.

2.1.4 Free Basic Water

The project was launched in 2002 and the District Municipality drives its implementation. They started the six schemes that are municipality driven, operational and implemented free basic water according to the government policy. To date 85 000 people have benefited.

Many regional schemes have been constructed since 1994. Some are partially completed and operational with second and third phases presently under construction or being planned.

2.1.5 Cholera Outbreak

The cholera cases were first reported in the Qhinqolo area in Mqanduli. A Joint operations Committee was set up under the chairpersonship of O.R.Thambo District Municipality and include the key departments such as Health and DWAF. Initial interventions included emergency water supplies by tanker, health and hygiene promotion by Departement of health and distribution of bleach water treatment. Cholera cases were then reported in other areas and by February 2002 at least six clusters of villages were regarded as affected of high-risk areas. By may 2002 reported cases of deaths were high.

The business plan for cholera has been submitted to DWAF in October 2002. The R53m is required by the District Municipality to assist all the areas affected under the District.

They received response from the Department on 6 January 2003 and by this time the outbreak has already taken place. DWAF has only approved R30m but nothing is written on paper to confirm that. This hampers service delivery in the communities.

Business plans of municipality councils take too long to be approved by DWAF. Although they still have problems with CMIP (Consolidated Municipal Infrastructure Programme) funded by the Department of Provincial and Local Government. Business Plans were not approved during the previous and current financial years. The Department has only approved R30m.

The request were made by the officials that the portfolio Committee must assist the problems of improvement to:

- Confront the Department with aal the problems – backlog on sanitation is very huge; and
- Convene a meeting between the Committee and DWAF to ascertain the obstacles.

2.1.6 Bizana Water Scheme and Sanitation

Bizana Water Scheme


This scheme is based on the Bizana Dam with an effective storage capacity of 167 000 cubic meter. The scheme currently supplies chlorinated raw water to 25 villages and includes 80 km of bulk main, 130 km of internal reticulation, 42 village reservoirs and 700 communal standpipes.

A further 8 reservoirs, 51 km of reticulation to serve further 10 villages has been constructed but not yet connected to the mains. The Nomcalu Water Purification Works is under construction in five phases to purify Bizana Dam Water as well as the additional future supply from Ludeke weir.

Bizana Sanitation

The town of Bizana currently makes use of septic tanks as a sanitation system. These tanks are cleaned on a regular basis and effluent dumped in the field.

2.1.7 Ntabankulu Scheme

There are no regional schemes in the Ntanbankulu District but 11 villages are supplied by the Mnceba scheme, which originates in the Mount Aylliff District. None of these villages are supplied at present due to bulk-line problems. The Buwa Scheme in Umhlotlo District supplies one village.

!4 spring protection schemes exist in the district, 7 windmill schemes, 13 hand pump schemes, 6electrical driven borehole pumped schemes and one diesel driven borehole pump scheme. In addition, two rural villages are supplied by the Ntanbankulu Scheme, which is based on the Forest Dam.

Of all the above only the two Town Scheme, 4 spring protection, 3 hand pump and 4 hand pumped borehole schemes are operational. None of the windmill schemes are operational.

2.2 Project Visits

2.2.1 Visit to Qunu Water Supply Project at Jonopo Cultural Village, Qunu Village

This water supply project which will completed by the end of March 2003, will supply water for approximately 8 000 people.

The project is funded by DWAF with the District Municipality as implementing agent. The busness plan, which was prepared by Mvula Trust, is in the process of being approved pending the approval of DWAF. As there are still issues to be sorted out between Mvula Trust and DWAF, the implementation cost will be brone by the District Municipality from its own coffers.

2.2.2 Visit to Gengqe Water Supply

The project was commissioned by DWAF in 1997 as part of the El Nino programme with Amanz’abantu as implementing agent, serving two villages and surrounding communities of approximately 3000 people. The schemes like many other El Nino schemes, has not been operational as there are no operations and maintenance provided for. Taps installed by DWAF are not functional and have never been repaired.

The total of 36 schemes under the El Nino Project, including Gengqe, need to be refurbished.The District Municipality allocated funds for the refurbishment, which be completed by end of February 2003, and will include spring protection.

The delegation visted the spring site at Gengqe and observed the following;

The spring is not fenced and protected. Water is shared and consumed by human beings and animals, such as goats, pigs, cows, sheep, etcetera. People are highly exposed to water borne diseases as they drink this water without it being boiled and disinfected.

2.2.3 Visit to Lower Nggwara

This project is part of the Cholera Phase 1 Programme and Qhingqolo Water Supply. During the visit, the tank was leaking because a mentally disturbed young girl vandalized it. Her family will repair it.

People in the community have access to water and spring protection is massive.

2.2.4 Visit to Qhinggolo Sanitation Project

In this project toilets made of corrugated iron were erected in this village. This was in response to reported deaths due to cholera. The delegation noted with concern that the community members do not use these facilities – they use them only during rainy days. Most of the people still relief themselves near the river. During heavy rains everything washed down into the river. They still use and consume the same water.

There are water schemes managed by DWAF. The functioning and managing of these schemes on a day-to-day basis is a big concern. The people of Lusikisiki have not been getting water since 2 December 2002 due to non-functional schemes and people are provided with tank water daily.
The DWAF staff members that were supposed to fix the dump pump were on leave. The Water Works never had a telephone since 1992.

2.3 Visit to Umzimkhulu Municipality

2.3.1 Overview by Councillor

There are no Free Basic Water projects in the villages under this municipality. People still consume untreated unpurified water from the rivers and streams. Very few people have access to tap water. In Malendle the windmill was not operational, there are no windmill at all in Mfulamhle.

Three sets of water samples were taken from the Mfumlamhle location in August 2002 and were sent to the State Pathology Laboratory for both cholera and bacteriological analysis. The results received in the same month in all three samples showed that the water is feacally contaminated. It was not clear whether these reports had been submitted to DWAF.

From an environmental health point of view communities using the above sources of water are exposed to diseases such as cholera and therefore urgent attention to remedy the present situation is needed.

It was also noted that some homesteads had poor toilet facilities, a condition which contributed to feacal contamination of the rivers. It was also reported thet children drown in the river while fetching water.

2.3.2 Bombvini Village

There was a cholera outbreak in 2001 and deaths were reported. Presently there are no water and toilet facilities. No water trucks were supplied by DWAF to assist this community. People still consume water from the river.

2.3.3 Visit to Umzimkhulu River

The river lies between KwaZulu-Natal and Eastern Cape. The ward near rhe area has 16 villages. These areas are included in the IDP.

Although there is electricity, nothing is done for the delivery of water and sanitation. Most of the people get water from the river and the streams. Local engineers do sometimes visit the areas.

2.3.4 Nazareth Village

There was a water project but it is no longer functional and operational. Presently there is no water structure. There are numerous unprotected and unfenced springs shared by both human beings and animals. People struggle to get water later in the evenings. The local clinic has taps and many tanks around it.

2.3.5 Singisi Village

There are no toilet facilities. People relief themselves near the Malenge River and when it rains, the polluted water goes the down to the river. People consumed this water.

The waste from the Sawmill factory nearby the Malenge River is thrown into the river and people drink this polluted water. As a result, there are many reported TB cases in the area. There is high possibility of cholera outbreak in the area.

2.4 Meeting with Mayors, Municipal Managers and Councilors at Ingeli Forest Lodge, Harding

Although this meeting was not included in the initial programme the delegation met with officials from the local and district level. It was well attended by officials of Alfred Nzo District Municipality, Umzimkhulu Local Municipality, Local Officials and Executive Mayors.

2.4.1 Delivery of Water at Alfred Nzo District Municipality

Most of the regional water schemes was developed by the former Transkei government. Most of these are no longer in good shape and dysfunctional. DWAF is now preparing to transfer these schemes to the District Municipality. They are participating in a forum on how to facilitate the transfer process.

Since they came into office in 2000, EU funds were used for purpose of provision of water in the areas. No DWAF funding was allocated to provide water and they can not meet the priorities of the people. The District is only able to provide water at an RDP level. They have managed to provide water to less than 30%(20% in rural areas) of the area, while the 70% is without water.

There is problem of capacity in terms of institutional arrangement. With the limited funds it is difficult for the District Municipality to attract engineers to do with water related issues.

In 1995 when Mr.R.Mhlaba was still Premier in the Province, funds totaling R43,5m of which R8m was sent to O.R.Thambo District Municipality were released from his office for water projects, but channeling of those funds were not proper. As a result of tha, there are still battling areas where funds were released but still there is no water in most of the villages.

KwaZulu-Natal has provided funds for cross border regional schemes and the areas in Maluti will benefit from these schemes.

There is a need to have a big scheme so that the water fron the river passing certain areas can be utilized in other areas. Operation and maintenance should be funded by DWAF to prevent schemes from collapsing. Some of the schemes (stand-alone schemes, boreholes, springs) are not sustainable. Stand-alone schemes, infrastructure development are the priority of the government.

There is still a huge backlog with sanitation. Awareness programmes have been conducted in 19 villages and is about to be completed. 4 700 households have been provided with sanitation at Alfred Nzo District Municipality. The nature the design is still pit latrine with corrugated iron. They intend to erect block structures for building of toilets.

It was noted that the Working for Water Programme is very problematic and causing problems a lot of divisions amongst communities.

2.4.2 Umzimkhulu Local Municipality

Free Basic Water is provided at Umzimkhulu. There is a project underway of water borne sanitation to eradicate the bucket system. Sewerage points are running but need to be upgraded. The reservoir needs to be upgraded to suit the capacity. None of the windmills are functional to service the communities. It will be very costly and expensive to repair.

Out of 300 villages in the municipal area, only 59 villages have RDP level water schemes. The rest of the schemes were run from the EU funding. Ponds are very old fashioned and not functional. Pit latrines are not up to standard. Because of the high rainfall, Umzimkhulu will need water borne sewerage.

Funding of R10m was allocated to install water metres but was cut to R5,7m, without any proper explanation. They have been allocated R4m to address the sanitation backlog, which is not sufficient, because a total amount of R12m is needed to eradicate the backlog. If RDP basic level water schemes are needed for the next eight years, R16m will be required.

There are no reported cases of cholera but only normal diarrhea. In most of these areas people are sharing water with animals.

3.FORESTRY INDABA, KWAZULU-NATAL

The Chief Director of Forestry, Ms.L.Mossop, welcomed all delegates. Opening statements were made by herself and by the Chairperson of the Portfolio Committee, Ms.B.P.Sonjica.

3.1 General Overview by Chief Director

The Department needs to fulfill the provisions of the National Forestry act and the challenges of poverty eradication and enhancement of the rural poor. United nations, World Bank and other donour countries have recognized the strength of the legislation. The strength of the legislation should be seen as solutions to the daily problems.

In terms of regulations, DWAF target stakeholder groups to respond to the draft. There is a suggestion that the National Forest and Veld Fire Act should be delegated to agriculture and local government at a municipal level in order to exercise its objectives.

She gave an overview of the content of the regulations of the National forest Act, clarifying the following areas: Purpose of the Act; Arrangement of the Act; making of the Regulations; Procedures for making regulations; Contents of the regulations; Procedures followed thus far and Comments received from various stakeholders regarding the regulations.

3.2.Restructuring Update

3.2.1.Restructuring of Category B Plantations – Mr.Mahlangu

The key policy objectives are the states withdrawal from commercial forestry management and move towards sustainable forestry management by the private sector, while at the same time broaden access to forestry ownership to previously disadvantage communities through Black economic empowerment.

Category B plantations include 21 plantations of 45 000 hectare in total, divided into estates (20 packages). These include viable and non-viable assets. 2 408 workers are involved in these plantations.

The progress that have been achieved so far and time frames include:

- EOI’s released in November 2002 – the closing date was 17 January 2003. More than 150 submissions were received from various organizations in this sector.
- The release of Request for Qualification in February/March 2003 – During this time there will be a selection process i.e. actual bidding process.
- The release of Request for Proposal in June 2003.
- Final Preferred Bidders – This will take place by the end of 2003.

3.2.2.Woodlot Devolution

Category C plantations or woodlots are smaller plantations and have an average size approximately 100 hectares. They were planted to supply local communities with fuel wood and pole requirements. The main objective of the restructuring is to transfer the management, control and ownership of these plantations to beneficiary communities.

DWAF has entered into joint ventures with community trusts using Community Forestry Agreements that is provided for in the National Forest Act. In terms of the Agreement the following apply:

- DWAF employees will continue to work on the woodlot paid for by DWAF.
- Revenue from the sail of timber will be retained by the Trust for the financing of the rehabilitation.
- DWAF employees will reduce by natural attrition over time and be replaced by community members as workload dictates.
- The Community Forestry Agreement terminates once Land Restition is completed.

3.2.3.Restructuring of Indigenous Forests

The indigenous forests of South Africa are a highly scattered and patchy resource compared to other resources such as commercial forests. It is estimated that there are 15 000 forest patches of indigenous forests. All the DWAF’s forests are large in number but on average also the smallest in size.

A briefing was given about the legislative and policy framework on indigenous forests, the transfer policy and DWAF’s new role. The National Forestry Act make provision for the assignment and delegation of forests to other agencies and the transfer policies.

The rationale for devolving management to other agencies is to promote greater participation in forestry, promote sustainable use of forests for their multiple use benefits, promote community forestry in which state and communities jointly manage forests and facilitate an integrated approach with bioregional and integrated planning process.

Progress to Date

Forest areas are earmarked for transfer to SANPARKS. There is still no agreement at political level between the Department of Environmental Affairs and Tourism (DEAT) and the Province about the Pondoland National Park at Port St Johns. The process is on hold from DWAF side.

At the Lowveld/Blyde Area, consultations DEAT and the Province at political level are underway and no agreement have been reached yet. Now DWAF is engaging with DEAT and SANPARKS at implementation level.

At Knysna Forest, the negotiations with DEAT, SANPARKS and Labour to transfer the forests are underway and the target transfer date is within the current financial year. The legal impediments between NPA and NFA have been resolved.

3.3. Eastern Cape Afforestation – Dr.T.Simelane

Eastern Cape is one of the poorest provinces in South Africa and a large portion of the population live in rural areas where there are very few sustainable employment opportunities. The province has potential for large-scale forestry development. The water resources are adequate and climatic and physical conditions are sustainable for forestry. A study by the CSIR identified 120 000 hectares with forestry potential. Most of the land in question is communally held.

Specifically the Pondoland, region between the Umtamvumba and Umzimkhulu rivers, and the Amatola region between Bashee and Buffalo rivers have been identified for development. The Government intends to promote afforestation and forestry industry development in these areas. The ideal is to promote the integrated development of the forestry industry in the province to support major new investment in forest products industries.

Blockages to Afforestation

There are a number of obstacles, which inhibit the establishment of afforestation in the province. Government has embarked on an initiative to remove impediments to forestry development in the province.

- Strategic Environment Assessment (SEA) – There is a need for a SEA to assist decision making for optimum land use. Lack of funding to undertake a SEA and the perception that an SEA was done during previous studies are problematic.

- Licensing – Poor co-operative governance amongdepartments responsible for licensing; lack capacity within the provincial department, lack of alignment and understanding of national and provincial policies; cumbersome licensing procedures; lack of appreciation for forestry as an economic driver in rural areas; lack on information on water and environment are the main obstacles.

- Land Ownership – There is no clear legal entity with the title to land representing the community with whom deals can be concluded.

- Political Endorsement – The role of forestry for local economic development is not fully recognized by provincial and local government.

To address the above one needs to see a partnership of DWAF, communities and the private sector. The IDP needs to be taken into cognizance. If the intention is to promote afforestation government should be strong on communal land. Critical aspects to forestry depend heavily on transport. Roads are very poor and to get the timber out it becomes very expensive and difficult. If trees can be planted, they can attract investors.

3.4 Strategic Environment Assessment for Forestry – Ms.P.Nodada

The main of objectives of SEA is to assist in the co-ordination of activities by increasing communication between the role players and assist in solving problems related to licensing. Gathered information will feed the province Afforestation Strategy and fast tracking of the planting.

Forestry plays a vital role in stimulating development. There were discussions on 7 March 2002 between the Forestry sector, DWAF and the Afforestation and Water Licensing Liaison Committee to discuss the idea of SEA. The area that has an interest in forestry or has high potential for forestry development will be a focused SEA pilot. A study has been conducted to see the comprehensive review of opportunities, constraints and alternative for that focused area.

A working group has been established; a field trip has been undertaken during mid-January this year; GIS database is being established; district municipalty IDP’s have been reviewed. They have also agricultural and environmental plans.

3.5. Forestry Enterprise Development – Mr.G.Harrison

Background

Forestry is this Province is underdeveloped. There is sufficient land and water for expansion but insufficient plantation area to attract markets and no capital to create the resource. To date the Eastern Cape has 10 communal forestry projects. In forestry and out grower schemes in South Africa, the Eastern Cape Province has rooted a small share.

Rationale and Goal of FEDO

The main function of the Forestry Enterprise Development Office (FEDO) is to promote and support sustainable forestry enterprises and its mandate is to support community based forestry sector enterprises development in Eastern Cape. AS there out grower schemes in rural areas and limited markets, FEDO contribute significant resources to address significant issues to achieve significant benefits.

The main goal is to give long-term investment for benefit of the people. This includes 60 000 hectares within 20 years; R150m turnover per annum and 3000 direct job opportunities.

3.6 Concerns of The Forestry Industry – Dr.T.Simelane

The following concerns were raised:

-
The annual spreading of an insect, sirex, at 600 km this year. These insects need to be managed using biological mechanisms. Discussions were held with the Australian government to assist in the controlling and containing of the insect from its rapd spread. The Government has been asked to assist to control them – it will cost R10 m to do ths exercise.
- Strategic Research – There is a need for strategic research on project of disease and insects.
- Afforestation – Licensing and afforestation projects should be fast tracked.
- Infrastructural problems – Discussions are ongoing with Spoornet.
- Property Rates Bill – Its impact on municipalities who get revenue through forests.
- Promotion of Forestry – DAWF needs to promote forestry because it is contributing R12b to the coffers of Government.

3.7 Eastern Cape Small Saw-millers Association – Mr.R.B.Hamann

All saw millers are members of the Association and should establish a strong structure as part of the Association. There is a shortage of timber in Category B plantations in some regions but surpluses in others. At Matiwane there has been no timber for more than two years.

3.8 Singilanga Directorate Trust – Mr.G.Nomlala

This trust is a combination of Singisi and Langeni Trusts. The Board of Trustees has 14 members chaired by mr.G.Z.Nomlala. He raised the following concerns for Singilanga communities and category A restructuring:

- The formation of Land Trusts.
- The dividends – No dividends was received last year.
- The inconsistency rental issue (R7,25m) paid by Hans Merensky Foundation to DWAF. Hans Merensky has already paid R15m.
- Black Empowerment - There are no DWAF representative in a forum where issues of Black empowerment are discussed.

From the tender applications that were received, two White companies were promoted. He is also of the view that local companies should betaken on board and be empowered.

3.9 National Forestry Action Programmme - Mr.Madlula

Background

The White Paper on Sustainable Forestry Development of 1997, set out the most important work to be done in the first three years of its implementation and identify the specific goals for each issue. Forestry restructuring has opened new issues that need to be addressed.

DWAF has decided to revise the old NFAP and develop a new National Forestry Programme. Its aim is to promote the effective use of resources and institutions to support government’s policy goal – to promote a thriving, equitable and sustainable forestry sector.

Objectives

The objectives of the NFP is to mobilize and organize forestry stakeholders nationally to develop a shared agenda for the forestry sector and also to mobilize and organize national and international resources and catalyse action to implement programmes/plans in a co-ordinated manner.

Important Features of the NFP

-
It is a framework for action and not a detailed, rigid plan.
- It is designed to satisfy national, provincial and local needs while meeting international obligations in terms of Agenda 21 and WSSD commitments.
- It is based on wide consultation
- It focuses on mobilizing human resources
- It needs to involve public sector, private sector, community and consumers.
- It needs to cover all aspects of sustainable forestry development – the resource, the socio-economic and the governance.
- It needs to ensure that the forestry sector is integrated with wider resource management strategie, emphasizing links with land-sue planning and integrated development.

Producing the NFP

The chief Director on Forestry Policy is responsible for the final preparation of the NFP. A number of task teams comprising people selected for their knowledge of various aspects of the sector will drive NFP development.

Presently the Department is planning for the NFP – gaining high level consent and involvement from the national Forestry advisory Council, the Minister and the Portfolio Committee; initiating a review of the old NFAP, its current status and identifying the stakeholders and key issues.

4. VISIT TO UMGENI WATER BOARD, KWAZULU-NATAL

4.1. Briefing on Umgeni Water, Pietermaritzburg

The Chairperson of the Board welcomed the delegation. When Umgeni was invited to present before the Portfolio Committee in August 2002, there were outstanding issues that were not finalized. The status of these issues are as follows:

- Mr.Manie Meyer Case – The report has been submitted to DWAF for consideration.
- Legal Outsourcing Claim – In March 2003, there is a court hearing set aside to finalise the case.
- Restructuring Process – The programme is underway.

4.1.1. Background

Umgeni Water is the largest catchment based utility in Southern Africa selling 350 million cubic meters of water annually to close to six million people in KwaZulu-Natal. Its customers include Ethekwini Municipality (including Durban-city), Msundui Municipality (including the city of Pietermaritzburg) as well as 20 local municipalities and some 50 rural communities. Established in 1974, Umgeni Water has developed into one of Africa’s most successful water management organizations.

4.1.2 Restructuring Programme – Ms.G.Moloi, Chief Executive Officer

She gave an overview of the main external and internal challenges, which lead to the restructuring of the organization. After identifying the challenges, Umgeni came up with the following:

- A new corporate strategy – which measure on how far they are progressing.
- A corporate balance scoreboard
- A new structure – new caliber of leaders to meet the challenges.

The Results of the Restructuring:

- The focus on their strategy is being addressed – need to put long term vision on better management of the financial portfolio.
- A cost-cutting drive is being undertaken – but resources are limited.
- A benchmark exercise operationally to be undertaken at strategic level.
- Restructure to put business plan continues and should be concluded by 30 June 2003.
- On 1 July 2003, real implementation will take off in line with new MTEF process – meeting the PFMA requirement moving on 3 year cycle.
- Partnership with regard to procurement forged with Rand Water – in the area of chemicals and promotion of black empowerment.
- The relationship with the union has been positive and constructive – good relationship with solid process going forward.

The Way Forward:

-
Focus on reducing their debt;
- Focus on equipping the staff;
- Focus on increasing access of water and sanitation in South Africa, Africa and the developing world.

4.1.3 Skills Development and Employment Equity – Ms.P.Mashophe,General Manager Corporate Services

The Skills development and Employment Equity are fully compliant with the Skills Development Act. They have consolidated record of training of employees in each occupational group trained during the last financial year. All the employees from G2 to G11 received more academic training than vocational training. In the same category more PDI’s received training than other groups.

Currently there is an embargo for new recruitment and the business plans will move people from the old dispensation. By 2005 the staff should reflect the demographics of the country.

4.1.4 Role of Water Boards and Umgeni Water – Mr.T.Mthembu, NEHAWU Representative

Properly and adequate water provision to all the people is a highly contested debate particularly around delivery options. The big problem facing the country is how to meet these challenges in the light of poverty, high unemployment and limited government resources. Umgeni fully supports municipalities to provide water services in the communities. If this responsibility is solely given to municipalities it will disadvantage those that have no capacity skill in providing water services.

Water Boards are available and highly established institutions, which on responsible restructuring can provide an answer to the mega challenge facing government in provision of water and sanitation to all people of South Africa and even beyond borders. They have readily available infrastructure, expertise, experience and some with financial resources to carry out this function.

The following reasons are what drive NEHAWU to believe that public accountable entities are the most suitable for water service delivery:

- Water is a resource essential to human survival also a human right. Decisions regarding the allocation of water should not be driven primarily by economic consideration. Decisions related to water provision touch upon critical issues related to public health, social security, the environment, gender roles and responsibilities, and sustainable resource management.
- Water is a common property or a "common pool" good rather than a market commodity. The fact that many governments to provide safe and affordable water to large segments of the population, does not automatically justify initiatives to treat water as a commodity or a commercial or economic good. Because the private corporation exists to generate profit for its shareholders, it is not the appropriate institution to manage the myriad of interest related to provision of an important public resource.
- Democratic and community involvement in water management decisions is essential. Governments should be accountable primarily to their own citizens about water management not the private institutions.
- Public sector ownership provides a legal and sometimes constitutional basis for accountability to the broader public interest. Private corporations are not legally or constitutionally bound to serve the public interest in the countries where they operate. Many corporations have minimal information disclosure requirements, which makes it difficult for citizen’s group or even the government to provide oversight and encourage accountability. Corporate interests may exercise undue influence over the government, compromising its ability to govern based on the interest of the public.

4.1.5 Future Role of Water Boards

The National Restructuring Task Team, which has been appointed to develop a restructuring framework to be completed within 60 days of Cabinet approval of the White Paper on Water Services will do the following:

- Ensuring an improved governance structure for existing public sector on water Service Providers enabling greater representation of Municipalities – to be completed by end of 2005.
- Rationalising existing public water services institutions through consolidation or disestablishment to ensure effective and efficient water service providers – to be completed by 2009.
- Regionalisation of water service provision should be achieved on in-depth status quo assessment and analysis of business case for most suitable institutional framework for regional water service providers – to be completed by 2009.
- Full-time National restructuring Team to be appointed by the Minister of Water Affairs and Forestry with the proposed composition – DWAF, DPLG, SAAWU and SALGA. This team has to elect and propose an independent chairperson to facilitate this process, as Umgeni would want to see sustainability improvement and delivery on the ground.

4.1.6 Free Basic Water

Water Boards has the same obligation as municipalities to provide the first 6000 litres of water per month for free. Umgeni fully subscribes to the Free Basic Water policy. Umgeni’s customers generally implement the policy. The problem is that for Umgeni the Free Basic Water is an unfounded mandate. It therefore lobbies for the amendment of the Conditions of Fund Transfer to include Service Providers like Water Boards.

4.1.7 Commercialization of Umgeni Water

The rationale for commercialization was based on long-term financial sustainability; sharing our human and technical capacity through the Water and Sanitation sector and contributing to South African Government and International water and sanitation delivery targets. The main focus is:

- Water and sanitation provision throughout South Africa and outside the regulated areas;
- Water and sanitation provision within neighbouring countries, within the SADC Region; and
- Water and Sanitation provision within the rest of Africa.

They operate on a 100% business basis and where clients can pay, based on signed and sealed agreements. Through their extensive experience in delivery of water service, they have explored the following:

- Pilots to learn – First thrust into Africa through Nigerian deal.;
- Financially viable clients - Lesson was to cease operation because Nigerian project could not pay and did not honour contract. As the result of that Umgeni water failed venture of potential income of R14m and non-payment of R750 000;
- Collaboration based on sound business principles – ongoing commercials activities in a few neighbouring States which are successful based on business principles.
- Alliance - need to work with partners who know the business.
- Strong partners strong delivery – the tender process in collaboration with credible resident partners e.g. Bergman, Ingerop, ESKOM Enterprises.
- Balancing commercial activity with political agenda (NEPAD support) – even though there is a fine line between commercial activity and the continents political and social agenda. Umgeni has incorporate both, such as their participation in the NEPAD processes and adherence to NEPAD principles.

With 82% of the annual turnover from two clients, it is healthy for Umgeni to strengthen and expand other options and broaden the client based. This will be achieved through commercial activities.

4.1.8 Non-regulated Business and Sanitation Challenges – Ms.M.Venter-Hildebrand

The main challenges include the following:

- Insufficient service delivery;
- Pressing urgency for improved water services, sanitation, health and hygiene; enormous institutional demands versus low delivery capacity; and
- Fiscal limitations versus high demands.

Sanitation Challenges

At any time it is estimated that patients suffering from water-borne disease occupy half of the worlds hospital beds. One flush of the toilet uses as much water for a whole day’s washing, cleaning, cooking and drinking. Comparative costs – in Europe $11 billion is spent on ice cream; in the USA and Europe, $17 billion is spend on pet food; in Europe $105 billion is spend on alcoholic drinks: ten times the amount required to ensure water, sanitation and hygiene for all.

In the past ten years diarrhoea has killed more children than all the people lost to armed conflict in World War II. In 1998, 308 000 people died from war in Africa, but more than two million died of diarrhoea diseases. At any time, 1,5 billion people suffer from parasitic worm infections stemming from human excreta and solid waste. One gram of faeces can contain 10 000 viruses, 1000 000 bacteria, 1000 parasit cysts and 100 parasite eggs.

Umgeni critical sanitation focus on institutional framework; technological options; mainstreaming of women; health and hygiene; community participation; harnessing subsidies; HIV/AIDS; collaboration and partnership; integrated and holistic implementation; job creation and local skills; and local-level governance and management.

Umgeni Water is facing the challenges of social responsibilities and cost-effective service delivery in non-money areas and rural areas; sustainability through the provision of quality service at affordable rates; outward focus and planning and demand responsiveness of communities, NBO’s, Government, Municipalities, regulated metropole of Pietermaritzburg and Durban metropole.

4.1.9 Capacity Building Strategy

The capacity building strategy is needed for improved livelihoods and poverty alleviation and involves the following components: demand responsive approach; education and training; capacity exchange; innovation and research.

Through focusing the social responsibility competencies and sharing of skills, this can be done by:

- Cross subsidization from other business ventures;
- Grant funding;
- Piggy-backing on Government programmes that focus on poverty relief.

The demand responsive approach will be done trough local government;education and training; knowledge exchange; community buy-in; innovation and research and knowledge management.


4.1.10 Water Fluoridation – Mr.P.Jonas

Consultation has been done with stakeholders, general public and local municipalities with regard to fluoridated water supply. Communication to internal stakeholders was done via internal publications. All municipalities except one municipality did not want fluoridated water supply and 200 submissions were received dorm the general public strongly opposing to fluoridated supply.

Umgeni has been proactive and involved in the debate on fluorodation.

4.1.11 Development and Control of Cholera Epidemic – Mr.P.Jonas

Cholera is an acute intestinal infection caused by the bacterium vibrio cholerae, which causes watery diarrhoea and vomiting that can quickly lead to severe dehydration and if treatment is not promptly given. There were 121 000 cases and 290 deaths in KwaZulu-Natal.

Umgeni Water’s cholera prevention initiatives:

- Advisor to KwaZulu Natal Cholera Management
- Health and hygiene education amongst local communities
- Tested rivers and rural water sources at Pathogen Laboratory
- Extensions of supply to stand pipes, tanks and re-hydration centers
- Assist the KZN Department of health to develop a risk model for cholera
- Assess rural sewage and water treatment plants
- Train local authorities in detection and management of cholera
- Cholera information page on website
- Papers at conferences
-Advise to public and media

Preventive Strategies:

- Awareness and education of the nature of the disease
- Improved personal hygiene practices
- Provision of accessible medical/treatment facilities
- Access to affordable and appropriate sanitation facilities and safe water supply to venues of large cultural events
- Sustainable funding

Short to medium term Interventions include:

- Effective, appropriate health and hygiene awareness campaign
- Dedicated health and hygiene education at schools
- Appropriate sanitation and water supply infrastructure at schools
- Intensive household education in rural areas
- Effective co-ordination of all providers of water supply and sanitation services
- Sustainable sources of funding

Long term action plan include:

- Must be directed at the root causes of epidemic outbreaks of endemic diseases
- Improvement of socio-economic living condition – this area need to be improved
- Improvement of access to medical treatment facilities
- Improved access to safe water and sanitation services
- Sustainable funding.

Umgeni Water will work closely with municipalities and other stakeholders to address the cholera challenge.

4.1.12 Powers and Functions of Municipalities – Mr.D.Boothway

The District Municipality has the following functions as stipulated in the Municipal Structures Act as amended in 2002:

Integrated development planning for the District Municipality as a whole, including a framework for IDP’s for all municipalities in the area of the District Municipality; potable water supply systems; bulk supply of electricity, which includes for the purpose of such supply, the transmission, distribution and, where applicable, the generation of electricity; domestic water and sewage disposal system and municipal health services.

Rural Reticulation Schemes

Rural reticulation started when Umgeni Water was established in 1979 and played a vital proactive involvement role in the first rural schemes in 1983 and rural areas water and sanitation plan with partnership with Joint Services Board and municipalities. As the implementing agent, they have partnerships with municipalities through DWAF with 47 schemes with R20m grant funding per annum.

Umgeni has concluded the transfer of rural schemes to Ethekwin District Municiaplity. A meeting was held with the city manager to discuss the matters of transferring the schemes. DWAF has agreed to finance R60m to transfer the schemes but the amount has not yet been received from DWAF. Presently there are still capacity problems.

4.1.13 Finance Aspect – Mr.A.Toms

Treasury Operations – Umgeni Water

Umgeni’s main funding needs are for capital assets, operating expenses and social responsibility. It social responsibility includes the rural water reticulation schemes; constructed 52 schemes; remaining 52 schemes; serve 27 141 people; investment of R882,6m; non-commercial return.

Its main sources of funding:
- Total requirement of R4,177 billion;
- R0,5 billion from Shareholder;
- Money and capital Markets R3,7 billion;
- Private Sector Commercial Investors.

Implications:

- Social responsibility challenges – Puts more pressure on tariffs;
- Investors demands high returns;
- Complex funding operations – treasury operations are outsource to TCTA;
- Some historical problems; and
- 52% of tariff revenue on serving debt.

Municipal Finance Bill

This Bill includes the following: additional powers are given to municipalities; in Water pricing; capacity of municipalities and the annual Division of Revenue Act.

Water Sector Financing

The water sector needs are for commercial water supply, poverty alleviation, rural reticulation (A basic human right, which not commercially viable.), major capital outlays and services backlogs.

The main sources of finance are National Government (DWAF), Public institutions – water boards, local authorities, public-private and public-public partnerships. Very little investment in this sector comes from Development Funding Institutions like DBSA, IDC, Land Bank.

The main constraints are:

- Ability of Water Supply Authorities to deliver financially;
- Bottlenecks – flow of funds from National to Municipalities;
- Capacity issues at local authorities; and
- Withdrawal of multinationals from water sector/developing countries.

4.1.14 Msinsi Holding - Mr.T.Moyo

Msinsi Holdings was founded in 1992 when Umgeni appointed the Wilderness Foundation to manage a vast tract of land around Shongeni Dam. Its core business is to provide land, wildlife and eco-tourism management services to their clients.

Since 2002, after lengthy negotiations, Msinsi’s shares were transferred from the Wilderness Foundation to Umgeni water in a bid to unlock shareholding value.Msinsi’s top manage ment structure compromises of a Managing Director and four Disvisional Heads which accounts to the shareholder through an independent Board of Directors.

Msinsi is an example of a Public Private Community Partnership and has a role to play in uplifting and developing the communities. They have provided employment opportunities to neighbouring communities and have seven-year relationship with Working for Water Programme to clear alien plants.

They have also signed a memorandum of understanding with six Amakhosi who reside around Nagle Resource Reserve. They are moving towards developing concessionary agreements with Black Economic Empowerment companies at Shongweni Resource Reserve so that they can reap benefits from eco-tourism.

They are now developing and facilitating community conservation areas at Shongweni and Nagle Resource Reserves in partnership with some of their strategic partners like Ezemvelo KwaZulu-Natal Wildlife.

At present, they are in a process of forming an environmental education trust that will benefit students and teachers from disadvantaged schools. Through the establishment of the trust, the aim is offer environmental education and wilderness courses to people who have never been exposed to such activities before.

4.2. Visit to Durban Height Water Works


Situated in Reservoir Hills, Durban, it is presently the largest water Traetment currently owned by Umgeni Water. It comprises 36 km of tunnels and siphons convey the raw water from the Nagle dam through the Valley of Thousand Hills, to the water works. The major supply is from Nagle Dam, but during periods of drought, water from Inanda dam may be pumped via an emergency pump station in to one of the Nagle Aquaducts, which feed this works.

C. COMMENTS AND RECOMMENDATIONS

1. The Eastern Cape Province needs to develop an appropriate leadership process and structure to drive sanitation strategies in an effective and co-ordinated manner. The approach should be to advance the delivery of sanitation more rapidly through a community supported public works programme.

2. To improve on the delivery of sanitation DWAF as leading department needs to play a strong role in close consultation and co-operation with other government departments and other service institutions in this sector to ensure a better co-ordinated approach to address the sanitation backlog.

3 .The Portfolio Committee take note of the provincial ground work that had been laid through the work of the MAAP Plan and the liaison afforded by the Integrated Water Services Management Forum (IWSMF), but it is important that the engagement of all role players should not be confined to provincial level only. It is essential that this communication process and its benefits should cascade to the lowest levels as to be of practical assistance to Local as well as District Municipalities.

4. The delegation noted that the lack of capacity within both the Department at regional level and Local and District Municipalities has a negative impact on project implementation in the Eastern Cape. We therefore want to recommend that DWAF, together with DPLG and SALGA, should put measures in place to address this problem to speed up the eradication of the huge backlog in water services in the rural areas of the Eastern Cape.


5. The information tabled by Amatola Water concerning the raw water pricing and its negative impact on water tariffs need to be dealt with in further interactions of the Portfolio Committee and the Department of Water Affairs and Forestry.

6. The Committee noted with concern that in some rural areas in the Eastern Cape where people don’t have access to clean and safe water, because of the historical backlog, that people are dependent of rivers and unprotected springs, where they use the unpurified water that is also drink by animals. We further noted that there are some non-functional water schemes inherited from the old Bantustans, which supplied water to communities in the past. We therefore want to recommend that DWAF and Local and District Municipalities should look at spring protection measure and the refurbishment of these broken down water schemes as an interim measure.

7. Further engagement between the Portfolio Committee and the Forestry Directorate of DWAF is needed on issues like forestry restructuring, labour conditions in the forestry sector, indigenous forestry management, infra-structural problems and the Eastern Cape Afforestation Programme. The Parliamentary Officer of DWAF will co-ordinate such a meeting and will liaise with members of the Portfolio Committee to send all outstanding issues for discussion to the Department.

8. One of the main blockages in the afforestation of the Eastern Cape seem to be a lack of appreciation for forestry as an economic driver in rural areas, as well as the poor co-operation between government departments involve in the issuing of licenses. The issuing of licenses and afforestation projects need to be fast tract and need a strong driving stance from DWAF as leading department.

9. The future role of Water Boards within the water sector is an important matter that needed to be examined carefully and sincerely by the sector as a whole to ensure that all institutional and other resources in the sector should be utilize to best effect.

10. The Committee took note of the positive developments at Umgeni Water Board, but at same time note that some of the historical problems at Umgeni are still not resolved and that it can have a negative impact on the current restructuring programme to turnaround this water utility. The Committee therefore proposes that all stakeholders should be called together to discuss these issues openly and to try and agree on a common approach on the way forward.

D. CONCLUSION

The delegation have managed to achieve all the objectives of the visits but was only able to visit a few rural communities in the Eastern Cape, because of time constraints. The delegation takes notice of the huge backlogs in water service delivery and the constraints that negatively impact on service delivery in this province. The Portfolio Committee needs to make further contact and visits to the Eastern Cape to lend its assistance to the resolution of the problems hindering effective services provision.

The challenge of water and sanitation provision necessitated bold initiatives and strong partnership action by all role players. It is therefore important that all institutions with capacity to contribute towards improvement in water supply services and sanitation should be given scope to make contributions, instead of unnecessary turf protection. The issue is not about institutions but about effective water service delivery.

Although the Forestry Indaba was informative and show the importance of such interactions, joint programme planning and follow-up reports on outstanding issues from the previous Indaba could have contributed to a more constructive workshop.

The Portfolio Committee wants express our appreciation to all who contributed to the success of these visits.


E. LIST OF PARTICIPANTS

Mr M Jonas, Chairperson: Amatola Water Board
Ms L Steele, Deputy Chairperson: Amatola Water Board
Ms S Mpahla, Senior Project Development Facilitator, Mvula Trust
Mr Potloane, The Deputy Director-General, DWAF
Mr Goldberg, Political Advisor to Minister, DWAF
Mr Z H Heke, Director: Water Resource Development, DWAF
Mr L Mxoko, Chairperson, Mvula Trust Project Facilitator, Mvula Trust
Mr F Martin, Professional Engineer, Amatola Water Board
Mr P C Maseti, Practising Attorney, Amatola Water Board
Mr M Matika, Councillor, Buffalo City Municipality
Dr S Muthwa, Fort Hare Institute of Government
Mr W Mzozoyana, Councillor, Amatole District Municipality
Mr X Nqgameni, Eastern Cape Disadvantaged Farmer’s Union
Mr S Somyo, Eastern Cape: SALGA and Executive Mayor, Amatole District Municipality
Mr S Kondlo, Chief Executive, Amatola Water Board
Ms M Bomela, Director: Finance, Amatola Water Board
Mr J Kilian, Director: Operations, Amatola Water Board
Mr H Makwarel, Director, Planning and Development, Amatola Water Board
Mr H Frauenstein, Director, Corporate Services
Mr M M C Ngoma, Director: Community Services, OR Tambo District Municipality
Mr S Mkentane, Chief Environmental Health Officer, OR Tambo District Municipality
Ms M Matiso, Technician, OR Tambo District Municipality
Mr L S Nduku, Councillor, OR Tambo District Municipality
Mr S Simpasa, Director: Infrastructure Development, OR Tambo District Municipality
Mr T K Mayosi, Deputy Director: Water and Sanitation, OR Tambo District Municipality
Mrs N Mngoma, Councillor, OR Tambo District Municipality
Mr L Ngedle, Representative, Department of Water Affairs and Forestry
Mr N Gule, Representative, Department of Water Affairs and Forestry
Mr Matikinca, Chairperson, Qunu Water Supply
Mr Y N Mbityi, Representative, Qunu Water Supply
Mr L Tshwete, Representatives, Department of Water Affairs and Forestry
Mr T G Sibiya, Ward 7 Councillor, Umzimkhulu Municipality
Mr Z Phakathi, Ward 6 Councillor, Umzimkhulu Municipality
Mr J T Ndlebe, Ward 4 Councillor, Umzimkhulu Municipality
Mr D J Zulu, Ward 11 Councillor, Umzimkhulu Municipality
Mr A R Katz, Works Manager, Umzimkhulu Municipality
Ms N O Mtyobile, Official, Umzimkhulu Municipality
Mrs B N Mkwanazi, Councillor, Umzimkhulu Municipality
Mr M Sogoni, Executive Mayor, Alfred Nzo District Municipality
Mr B J Magojo, Member of Mayoral Committee, Alfred Nzo District Municipality
Mr C S Maduna, Exco member, Umzimkhulu Municipality
Mr D Lugayeni, Member of Mayoral Committee, Alfred Nzo District Municipality
Mr M V Nkqayi, Member of Mayoral Committee, Alfred Nzo District Municipality
Mr G G Mpumza, Manager, Alfred Nzo District Municipality
Mr S K M Mnukwa, Member of Mayoral Committee, Alfred Nzo District Municipality
Ms B P Mabenga, Member of Mayoral Committee, Alfred Nzo District Municipality
Mr B M P Dzanibe, Mayor, Umzimkhulu Municipality
Mr B H Makedama, Planning and Engineering, Alfred Nzo District Municipality
Mr T V Dyonas, Municipal Manager, Umzimkhulu Municipality
Mr M Nkosi, Deputy Director, Forest Policy, DWAF
Ms L Massop, Chief Director, Forest Policy, DWAF
Mr S Mhlongo, Member: NFAC (National Forestry Advisory Council
Ms M Raganya, Member, NFAC
Mrs M Matthee, Member, NFAC
Dr T Simelane, Director: Forest Policy, DWAF, Eastern Cape
Mr N Quvile, Deputy Director: Forestry, DWAF, Eastern Cape
Mr L Katende, Area for Manager, DWAF. Eastern Cape
Mr V Dladla, Member, NFAC, Mpumalanga
Mr C Mtoba, Director, Forest Policy, DWAF, Eastern Cape
Mr T Mjali, Representative, DWAF, Eastern Cape
Mr M Mqalo, Representative, DWAF, Eastern Cape
Mr R Mack, Member, NAFC
Mr B Hamann, Representative, Eastern Cape Sawmill
Mr Mfelasakhe Mahhlangu, Representative, DWAF, Pretoria
Ms P Nodada, Senior Co-ordinator, DWAF, Eastern Cape
Mr G Z Nomlala, Member, NFAC, Eastern Cape
Mr R Madula, Acting Deputy Director: Forest Policy, DWAF
Mr R B Hamann, Representative, Sawmiller, Eastern Cape Region
Ms G Moloi, Chief Executive, Umgeni Water
Mr P Ngcobo, Board Member, Umgeni Water
Mr T Moyo, Managing Director: Msinsi Holdings, Msinsi Holding (Pty) Ltd
Mr B Thabede, Personal Assistant to Chief Executive, Umgeni Water
Mr U Natha, Strategic Planner, Umgeni Water
Mr A Toms, Acting General Manager: Finance, Umgeni Water
Mr M Msiwa, General Manager: Operations (Ulwandle), Umgeni Water
Ms M Venter-Hildebrand, General Manager: Africa/South Africa, Umgeni Water
Mrs R Bhengu, Board Member, Umgeni Water
Prof O Latiff, Chairperson, Umgeni Water
Mr W Barnsley, Board Member, Umgeni Water
Mr P Jonas, General Manager: Operations Support, Umgeni Water
Mr D Boothway, General Manager: Operations Support, Umgeni Water
Mr P Maphoshe, General Manager: Corporate Services, Umgeni Water
Mr J Sishi, Shop Steward, NEHAWU, Umgeni Water
Mr P Mkhize, Shop Steward, NEHAWU, Umgeni Water
Mr T Mthembu, Shop Steward, NEHAWU, Umgeni Water
Mr M Dayanand, Acting Process Controller, Umgeni Water (DHTS)
Mr R Nabee, Senior Operator, Umgeni Water (DHTS)
Mr D Naidoo, Acting Area Manager: Central Area, Umgeni Water (DHTS)
Mr K Zwane, Acting Works Manger, Umgeni Water (DHTS)

Report to be considered.