ATC240312: Report of the Portfolio Committee on Water and Sanitation on the National Water Resources Infrastructure Agency Bill [B24-2023] (National Assembly – sec 75), dated 12 March 2024

Water and Sanitation

Report of the Portfolio Committee on Water and Sanitation on the National Water Resources Infrastructure Agency Bill [B24-2023] (National Assembly – sec 75), dated 12 March 2024

 

The Portfolio Committee on Water and Sanitation (the Committee), having considered the National Water Resources Infrastructure Agency SOC Bill [B24 - 2023] (National Assembly – section 75), referred to it and classified by the Joint Tagging Mechanism (JTM) as a section 75 Bill, reports the Bill with amendments [B 24A- 2023].

 

The National Water Resources Infrastructure Agency SOC Bill [B24 - 2023] (“the Bill”) was introduced in the National Assembly (proposed 75 Bill), with the explanatory summary of the Bill and prior notice of its introduction in Government Gazette No. 49063 of 1 August 2023. The Bill was tabled and referred to the Committee on 25 August 2023. (The English text is the official text of the Bill). The Bill seeks to provide for the establishment of the South African National Water Resources Infrastructure Agency as a state-owned company and major public entity; to provide for the objects and functions of the Agency; to provide for the governance of the Agency by the appointment of the Board of the Agency; to provide for the appointment of the Chief Executive Officer and Chief Financial Officer of the Agency; to provide for the funds of the Agency, financial reporting and accountability of the Agency; to provide for the transfer of the national water resources infrastructure; to provide for the transfer of the Trans-Caledon Tunnel Authority to the Agency; to provide for the disestablishment of the Trans-Caledon Tunnel Authority; to provide for the powers of the Minister in relation to the Agency; to provide for the making of regulations and to provide for matters connected therewith.

 

On 19 September 2023, the Department of Water and Sanitation briefed the Committee on the Bill in a virtual meeting.  In facilitating effective public participation in the Bill, the Committee published a call for public comments, with the comment period lapsing on 4 November 2023.  There were various reasons for full support, partial support, and complete rejection of the Bill.

 

Many of the comments from the general public that did not support the Bill were not specific to the content of the Bill but related to the intent of the Bill, which is the establishment of the Agency. These individuals believed there was no need to establish a new agency – the government should hold the existing institutions accountable and capacitate them to provide these services.  They also indicated that creating the Agency would unnecessarily increase the cost of water and privatise water services and their supply.  In addition, they were concerned that the Agency would provide a conducive environment for corruption, cronyism and maladministration.

 

Two substantive written submissions discussed the content of the Bill and were received from the South African National Biodiversity Institute (SANBI) and the Western Cape Provincial Government (WCPG).  SANBI supported the bill in their submission with suggestions on where it could be enhanced but did not wish to make an oral submission.

 

The WCPG did not support the Bill as they were uncertain if the DWS conducted a Socio-Economic Impact Assessment (SEIAS). The DWS confirmed that the Presidency approved the final SEIAS in June 2023, and the National Treasury has independently reviewed and assessed a business case for the NWRIA. Several suggestions have been made regarding grammatical changes and drafting suggestions.  

 

Oral submissions were received from the National Economic Development and Labour Council (Nedlac), the South African Local Government Association (SALGA), the National Treasury and the Congress of South African Trade Unions (COSATU). The Department of Water and Sanitation responded to the issues raised during the public hearings on 28 November 2023.

 

The Committee deliberated on amendments on 6 and 20 February 2024. The Portfolio Committee proposed and adopted numerous amendments in respect of the following clauses: 1, 3, 7, 9, 17, 34 and 35:

 

Clause 1: Definition and Purpose	Addressed a correction to a reference to a section within the Act regarding the definition of “waterwork” in response to legal challenges and considerations raised during the public participation process. The definition aimed to encompass water infrastructure resources and proposed specific language for the definition.
Clause 3 (6): Establishment of Agency	Clause 3 was raised for attention during deliberations. The proposed amendment replaced the term "shareholding" with "shares" to align with contracts properly. Additionally, the amendment specified that the Minister would be the sole shareholder in establishing the Agency.
Clause 5: Application of Companies Act to Agency	Rejected the clause as Clause 3(9) already addresses the essence of Clause 5. Even if Clause 5 is removed, Clause 3(9) still ensures the application of the Companies Act and Public Finance Management.
Clause 7: Functions of Agency	Clause 7(1) clarifies the role of the National Assembly or Parliament. Clause 7(2), (3), (4) and (5) are consequential changes aimed at ensuring consistency in the context of the functions of the agency. These amendments encompass six changes in total.
Clause 9: Role of Board	The proposal suggests that the board must initially adopt an interim code of conduct acceptable to the Minister. The proposed amendment requires that within six months of the Board's appointment, they must develop a permanent code of conduct, which also requires Ministerial approval. This approach ensures that there are guidelines in place for the board's behaviour from the outset, minimising any gaps in governance.
Clause 11: Appointment of non-executive Board members	The proposed amendment changed non-executive board members’ composition, qualifications and appointment process to ensure clarity and coherence in the appointment procedures.
Clause 17: Establishment of Committees	The proposed amendment clarifies the concept of a special majority, ensuring a clear definition and understanding of voting requirements within these committees.
Clause 34: Submission of quarterly reports and corporate plans	This proposes the submission of annual corporate plans and quarterly reports to Parliament, emphasising the role of the parliamentary committee in reviewing and engaging with these.
Clause 35: Financial statements and annual report	Similar to clause 34, this clause proposes the tabling of the agency’s annual report in Parliament for consideration, enhancing parliamentary oversight and involvement in agency activities.

 

 

Report to be considered.