Water Services in South Africa 1994–2009

Abstract

Since 1994, South Africa’s government has demonstrated profound commitment to achieving universal access to water and sanitation – through ambitious policy reforms, institutional restructuring and substantial funding for infrastructure development and operating subsidies. It has met its 2015 MDG goals for both water services and sanitation. But the country as a whole has underestimated what it takes to sustain effective water services: expanding access is comparatively straightforward when compared to the challenges of providing an ongoing service, with all the inherent challenges of strategic management, operation and maintenance, revenue administration and relationship building. Concurrent local government restructuring has meant that infrastructure expansion has generally outpaced the institutional development needed to run the new services. Moreover, top-down, target driven delivery has largely marginalised and alienated ordinary people. Many municipalities have not resourced their water services functions appropriately, and there are severe municipal skills gaps. In response to poor services, unresponsive councillors and corruption, social protest action soared in 2009. Government is now giving priority to a comprehensive turnaround strategy to strengthen local government and its service delivery performance. But the more services are expanded and upgraded, the greater the need for operating subsidies, because the levels of service being provided – certainly in urban areas – are not affordable to a large percentage of the population. Growing dependence of municipalities on grants means that far greater attention must also be given to the efficiency of providing services, to contain costs. Meanwhile leaks and losses associated with neglected maintenance create supply bottlenecks, and raise the costs of provision. Improved management of water services is imperative to enable the inclusive growth and development that South Africans need to escape from high levels of poverty.

3.1 Introduction

South Africa has much to be proud of in its water services sector: Constitutional rights to dignity, access to sufficient water, and a healthy environment; a concentrated focus on achieving universal access to water services, supported by vast capital grants and operating subsidies; provision of free basic water to ensure that price is not a barrier to access; an innovative incentive-based approach to regulating water and wastewater quality; and so on. High-level commitment, backed by substantial spending on infrastructure development and servicing subsidies, has led to some extraordinary achievements. Government figures indicate that by 2009, water services infrastructure had been extended to 96% of the population, up from 59% in 1994 (DWAF 2009a). Put differently, the number of additional people reached by new water services infrastructure since 1994 is far greater than the total population of Angola, Chile or the Netherlands.

By any measure, this is a remarkable achievement. But, in its commitment to meeting service delivery targets far more ambitious than the MDGs, government has underestimated the challenges of ensuring sustainable, ongoing water services. Providing a reliable ongoing supply of safe drinking water 24/7 is far harder than building the infrastructure needed to enable access. In many areas, problems in operating and maintaining infrastructure are leading to service breakdowns, and delivery short of expectations is fuelling increasingly vocal public protest.

The integrated nature of the water services process – across water resource management, environmental management, and technical, financial and administrative dimensions, with a necessary emphasis on managing the relationship between the service provider and many thousands of service users – makes it much more challenging than other sectors which combine infrastructure and servicing (Muller 2009). The stakes are higher too. Mismanaged water and sanitation services have enormous potential to cause severe hardship, illness and environmental damage. Mismanagement impacts most harshly on the poorest, but also on business, industry and tourism and their ability to provide jobs and generate tax revenue.

Good management of municipal water services is vital for national water security, particularly as climate change and unpredictable rainfall introduces new risks and uncertainties. This requires water services institutions that are competent to deliver reliable supplies of safe drinking water in a context of deteriorating raw water quality, rising demand and growing scarcity, and can manage the collection and safe treatment of wastewater without imposing harsh burdens on future generations. Far greater reliance on re-use and recycling is likely. These issues underline the importance of cost-effectiveness and affordability in water services, nationally, to safeguard the rights of access of the most needy and vulnerable citizens. But there is growing acknowledgement of the gulf between the state of water services management, and the level of professional skills required to manage growing complexity.

The tension between infrastructure provision and on-going service provision capability has played out in a context of concurrent reform in the water sector and the local government sphere. Rapid decentralization of responsibility for the provision of water and sanitation, with massive spending and development to achieve universal service access swiftly, occurred in tandem with massive upheavals in the form and function of local government. Since 1994, the role of local government has been fundamentally reconceived as the primary driver and enabler of development, as well as the primary implementer of programmes to eradicate apartheid-based service disparities in water, sanitation and a range of other areas. Immense restructuring and transformation in local government has been necessary to lay the basis for this new role. One consequence is that national policy objectives do not yet align with the municipal capability to implement those policies. Another is that most municipalities have opted for a technocratic top-down approach to delivery, with decisions implemented with little public involvement. But many municipalities lack the skills needed to succeed with a technocratic approach; in too many instances, the result has been non-delivery, or development of poor quality infrastructure without the resources to keep it working.

The growing number of service protests – far more between January and August 2009 than in any full year since 1994 (CGTA 2009d) – are not simply a demand for ‘better’ services, delivered more effectively and efficiently. More importantly, they reflect a demand for a more inclusive mode of development (Pithouse 2009), where priorities and projects are shaped through engagement and confrontative dialogue (Galvin 2009), rather than by external delivery targets. This is likely to entail a more protracted approach to service improvement, driven less by patronage than through partnership; but without this, sustainable services that meet people’s needs affordably are unlikely.

This chapter reviews some themes in water services delivery over the past 15 years, flags some lessons learnt the hard way and underscores the importance of more professional water services management, particularly as evidence of greater climate variability mounts.

3.2 Poverty and Inequality: the Context of Policy Formulation

Poverty, inequality and vulnerability define South Africa to its core, and provide the essential context for the path the country has pursued for water services. South Africa has the world’s 33rd largest GDP, and is a middle-income emerging economy. Its population is just less than 50 million people. Average GDP per capita (purchasing power parity) was US$9,757 in 2007, but this figure obscures enormous disparities in income (UNDP 2009). According to UNDP figures, 43% of South Africans lived on less than US$2 per day in 2007 (Ibid.), as a result of structural poverty and chronic unemployment, compounded by the impacts of one in six adults being infected with HIV. The impacts of AIDS are rolling back decades of development: average life expectancy in South Africa has now fallen from 63 years in 1990 to 50.5 years in 2009, similar to what it was 40 years ago (ASSA, cited in Presidency 2009; UNICEF 2009). South Africa now has the biggest anti-retroviral programme in the world, but about 1,000 people die every day from AIDS-related problems, and there are an estimated 1,500 new infections each day (MRC 2009).

South Africa has one of the highest Gini co-efficients in the world, denoting extreme income inequality. The Presidency acknowledges a Gini co-efficient of 0.666 (Presidency 2009), with other sources rating it even higher (Bhorat et al 2009). The black middle class is growing rapidly, but the median income of the white population, which comprises about 9.2% of the total, remained more than ten times that of the black population in 2008 (Presidency 2009).

South Africa’s poorest households are female-headed, and rural. ‘Rural’ is a very inadequate description of the wide range of settlement types clustered under this loose category by census enumerators, and suggests an easy distinction between urban and rural areas. The reality is more a continuum of settlements types and densities, with a range of different defining features. In the context of this discussion, rural areas include commercial farmland, where the majority of farm dwellers live in conditions of acute poverty and marginalisation. In the South African context, however, rural areas are more widely associated with the former ‘Bantustans’ or ‘homelands’, and include areas of subsistence farming and extensive settlements with no discernable economic base beyond welfare grants. Only a quarter of working-age adults in these areas are employed, compared to almost half in the rest of the country, and employment in the former Bantustans is typically at very low wages, with over half of those employed earning under US$135 a month in income in 2006 (Philip and Hassan 2008).

Although one third of households lived in rural areas in 2005, well over half – 57.1% – of all poor households live in rural areas (Armstrong et al 2008) and the incidence of poverty in rural areas is more than double the corresponding rate for urban areas. Table 3.1 highlights the severity of rural poverty, and its gendered dimensions.

Table 3.1 Income distribution in South Africa, per quintile (Armstrong et al. 2008), sourced from the 2005/06 Statistics South Africa Income and Expenditure Survey

In 1994, four in ten people lacked access to a basic supply of safe drinking water, and more than half had inadequate sanitation (RSA 1994), with backlogs most severe in rural areas. Urgent interventions were required to address gross inequality and underdevelopment across virtually every dimension of the state, and the new government quickly embarked on a systematic overhaul of the structure, objectives and statutes of government.

Two core documents, each arising from intensive national consultation and negotiation processes, shaped the new government’s course of action. The first was the 1993 Interim Constitution, which spelled out the institutional framework of the new South Africa. The second was the 1994 Reconstruction and Development Programme (RDP), which effectively constituted the ANC government’s political manifesto. The RDP stressed that

‘The national government wishes to unlock the political and creative energies of the people and bring government closer to the people … for the first time in South Africa’s history, emerging democratic local authorities must work with community-based organizations and NGOs to establish minimum conditions of good governance and to implement effective development projects’ (ANC 1994)

The fundamental premise of the RDP was that people who are affected by decisions should take part in making them, and that development would occur through the growing empowerment and self-reliance of communities in shaping their own destinies. Second on its list of six basic principles was the assertion that, ‘Development is not about the delivery of goods to a passive citizenry. It is about active involvement and growing empowerment’ (ANC 1994). The themes of participatory democracy and people-centred development cross-threaded the RDP’s five key programmes, notably those of meeting basic needs; developing human resources; democratizing the State and society; building the economy; and implementing the RDP. Water was an essential ingredient in each of these programmes.

The Constitution, adopted in 2006, added a right of access to water to the Bill of Rights. Local government was given responsibility for ensuring the provision of services, while national and provincial government were mandated to strengthen the capacity of municipalities to perform their functions, and to regulate their performance.

3.3 The Policy Framework for Basic Water Services Provision

In November 1994, DWAF published a White Paper on Water Supply and Sanitation, which gave effect to the RDP in the water sector. The policy’s goal was ‘to ensure that all South Africans have access to essential basic water supply and sanitation services at a cost which is affordable both to the household and to the country as a whole’ (RSA 1994).

The White Paper’s foremost concern was equity for the poorest. It acknowledged the diversity of water supply arrangements countrywide, but its focus was on enabling access to a basic water supply in the country’s neglected rural areas through community water and sanitation initiatives.

Ahead of any international benchmarks, the White Paper formalised the concept of a basic water supply as the minimum standard, and quantified this as 25 l per person per day within 200 m. This was the minimum required for direct consumption, food preparation and personal hygiene, in line with government’s commitment to maximise coverage and ensure all South Africans had access to basic water and sanitation within 7 years. In line with its principle of ‘some for all, not all for some’, the White Paper recognised that the amount should be adjusted over time.

The White Paper drew heavily on international experience, particularly the failure of technicist supply-driven approaches to infrastructure delivery. Echoing the RDP, its core theme was that development should be people-driven, and that ‘the provision of services in poor communities will fail if the people themselves are not directly involved. The involvement and empowerment of people is thus a cornerstone of the approaches proposed.’ A complementary strand was the principle of payment for services:

If the community expects some outside agency to be responsible for keeping their supplies going, they will have no control over the processes and lose leverage and ownership. Responsibility for keeping the service going is placed with a remote authority and accountability is lost.

The White Paper argued that services should be provided and paid for in a manner which would not require on-going government funds to keep them running, and should be self-financing. The only exception would be where poor communities were unable to afford basic services: ‘Government may subsidise the cost of construction of basic minimum services but not the operating, maintenance or replacement costs.’ A social tariff, covering only the operating expenses, would be charged for the minimum level of service, which was a communal water source. For higher levels of service, the full cost of supply would apply.

The White Paper endorsed a sliding tariff scale, with three tiers. The first was a life-line or social tariff, to cover basic human need, for a quantity not exceeding 25 l per person per day. The second was a normal tariff, for amounts up to 250 l per person per day, provided at cost (operation and maintenance plus capital), including a portion to recoup the loss incurred from the life-line tariff. The third tier was a marginal tariff for consumption of water above 250 l, assumed to be for luxury uses, and consequently, charged at the marginal cost, which was defined as the present day cost of the latest or next augmentation scheme. The principle of a rising block tariff, designed to cross-subsidise the poorest users, was thus a central feature of post-1994 sector policy.

The 1997 Water Services Act gave legislative effect to the 1994 White Paper and the constitutional right of access to water, and wrote the concept of a basic level of service into law (Muller 2007). A core principle of the Act was the distinction, at local level, between a municipal Water Services Authority, and the Water Services Provider. Responsibility for ensuring access to, at least, basic water and sanitation services was assigned to those municipalities designated as Water Services Authorities. Actual provision was the responsibility of designated water services providers, which could be the technical section of the same municipality, another municipality, or an external contracted agency. The key distinction was between the authority function – responsible for setting policy, ensuring universal access to at least a basic service and regulating service provision to ensure effectiveness, efficiency and sustainability – and the provider function, which was responsible for executing the policies and strategies of the authority and delivering the actual service. When performing the functions of provider itself, a water services authority was required to distinguish between its authority and provider functions, and account separately for them.

However, subsequent developments would show that this elegant, conceptual separation between local regulator and provider was seldom achieved, primarily because the local government sphere was preoccupied with far-reaching transformation processes of its own, with a different agenda.

3.4 Expanding Access to Water Services

The immediate challenge facing the new government in 1994 was to assemble a single public administration. Apartheid South Africa was comprised of eleven separate administrative and political territories: ten so-called ‘homelands’ scattered over 50 separate land portions, and the dominant Republic of South Africa, governed by a tri-cameral parliament for three minority racial groups.

In the towns and cities of so-called ‘white South Africa’, separate municipal service delivery administrations addressed the needs of each of the four official racial groups, with services in black townships generally inferior and often run-down. Rural areas were served either by provincial administrations or regional services councils at district level.

The ten ‘homelands’ were run by large bureaucracies, virtually as an end themselves, with poor productivity and corruption well-entrenched. The legal sophistry of apartheid had created a vast unaccountable muddle of delegated jurisdictions and overlapping administrations to postpone the inevitability of democratic government, and effective service delivery to all South Africans was simply not on the agenda pre-1994.

As the 1990s progressed, 2000 became the deadline for putting in place a framework of municipalities that would permit wall-to-wall local government countrywide. Massive restructuring would be necessary to integrate and reconfigure the administration of the country into a form able to tackle the enormous development challenges it faced. Yet, despite the structural integration and change in leadership that followed, the staffing and ethos of the previous administrations formed the backbone and shaped the practise of the new administration, with a remarkable degree continuity (McLennan and Munslow 2009).

In 1994, South Africa’s urban landscape was already in flux, with the task of integrating local race-based administrations already starting to get underway. Administrations established to run ‘white areas’ were having to come to terms with the fact that they were no longer in charge, and that the majority of resources could no longer go to serving only the needs of a privileged minority. There were, however, at least core functional administrations in place to plan and manage the steady extension and upgrading of water service coverage, even if their spatial boundaries were extended hugely.

In the rural areas of the former ‘homelands’ where backlogs were most acute, there were no municipal structures to effect delivery, just the vastly fragmented remains of the apartheid state architecture.

The new ANC government assigned the new Department of Water Affairs and Forestry (DWAF) responsibility for tackling water services backlogs in rural areas, until local government structures were in place in all areas. Pre-1994, DWAF had been concerned, primarily, with water resource management, and ambitious infrastructure schemes to serve the country’s macro-economy. Second-tier management, routing bulk supplies from dams to mines, industry, municipalities and other centres of demand, was essentially the domain of the water boards, such as Rand Water and Umgeni Water. In the former ‘homeland’ areas, third tier management – retail water services and domestic water provision – was now added to DWAF’s mandate. Water services in towns and cities remained the responsibility of the municipal administrations that ran them (Schmitz 1999).

DWAF was able to hit the ground running in 1994 in its expanded role with well-formulated policies and a practical implementation strategy, thanks to the far-reaching preparatory work of an extra-parliamentary forum for water-related matters established in 1992, called the Standing Committee on Water Supply and Sanitation or SCOWSAS. The imprint of SCOWSAS is evident in the RDP and its recognition of the importance of access to water as an enabler of development (Muller 2007). Equally, DWAF had benefited enormously from its participation in a broad Drought Forum of political parties, government and non-governmental agencies, which sought to ensure that previously neglected rural communities benefited from government and donor-funded drought relief initiatives in the early 1990s. The Drought Forum’s approach was community-based and focused on setting up and supporting CBOs to manage and operate local water schemes. It was, subsequently, widely adopted in the early phases of DWAF’s Community Water Supply and Sanitation (CWSS) programme (Galvin and Habib 2003).

Within DWAF, a new Community Water Supply and Sanitation (CWSS) division was established in 1995, and the department’s budget ratcheted up swiftly to fund implementation of rural water and sanitation projects. DWAF rapidly assembled an impressive delivery machinery, able to extend coverage to areas where previously there were none. Projects were selected, based on a nationally co-ordinated planning process, and no ceilings were applied to per capita subsidy amounts for water. Recipient communities were expected to pay for the operating and maintenance costs of installations, but no contribution was required towards capital costs. Responsibility for overseeing the operation and maintenance of the new schemes would, in time, be transferred from DWAF to municipalities (Savage and Timm 2003, unpublished report).

Water boards and water sector NGOs were enlisted to assist delivery. There was a strong commitment to community participation, and in the case of the Mvula Trust and its partners, to demand responsive approaches and community management. The Mvula Trust and its partners were particularly effective in working on the ground with CBOs, equipping them to plan, manage and, subsequently, operate more than 300 water and sanitation projects. Many were remarkably effective and successful (GTZ 1998). A handful of these projects survived for over a decade, still run by community structures separate from local government and funded by residents. Possibly the last remaining community-run project, in Nhlungwane in southern KwaZulu-Natal, was absorbed into municipal servicing in early 2008.

Capacity to implement demand-responsive projects was limited, however, and the realities of mobilising poor communities to establish village-level structures capable of co-planning and managing projects and collecting their designated contribution of 10% of the capital cost (a feature of the Mvula approach), constrained the pace of progress. Participatory development has its own time frames, and cannot easily be reconciled with the requirements of external delivery schedules. Participatory approaches increasingly came to be associated with slow delivery, notwithstanding their other merits.

Further capacity was brought in from 1997, with the launch of the Build Operate Train and Transfer (BOTT) programme in the four provinces with the greatest backlogs. Consortia of private sector firms, at times with NGO involvement, would deliver a package of infrastructure, accompanied by community consultation and training. Project performance criteria specified the use of local labour, and balanced representation of men and women on project steering committees.

The enormous pressure to achieve tangible results, and the scale of resources being allocated to rural water and sanitation projects, steadily tipped the balance towards short-cuts in establishing village water committees able to manage and maintain scheme. In many instances, these short-cuts compromised their ability to function effectively – leading community-level planning processes, overseeing the recruitment and training of labourers, collecting contributions from local residents, and ultimately running basic water supply schemes. But voluntary community management structures were not necessarily appropriate in many of the more complex schemes. Where a steady water supply required a committee simply to maintain a pipeline from a safe mountain spring, the risks of failure were minimal, but more elaborate schemes, requiring diesel or electricity purchases, maintenance and regular payments by users, required greater training and commitment (Muller 2007). The responsibilities of users were often not adequately communicated to them, leading to hostility and resentment when they were expected to self-fund malfunctioning schemes. Where local community structures were unable or unwilling to keep schemes functioning, water supplies tended to fail.

An important part of DWAF’s response to evidence of weak schemes and poor cost-recovery was to re-assert the importance of involving residents in the planning and management of schemes, and to refine its approaches to building effective local structures able to oversee local project implementation and the subsequent operation and maintenance of village water schemes. In some regions, however, where local government restructuring was gaining momentum and municipalities were establishing their own structures and planning forums, these community water and sanitation committees resembled a parallel rural local government system, prompting tensions between sectoral and municipal-led initiatives (Savage and Timm 2003; DPLG 2001). Moreover, some municipalities maintained that DWAF was high-handed in its approach, by building infrastructure and expecting them to take over ownership and maintenance without having adequately engaged them in planning or budgeting (DPLG 2001). This was particularly true from 2000, following South Africa’s second democratic elections and the establishment of representative local government structures country-wide.

3.5 Local Government Restructuring

In its magnitude and complexity, the process of local government transformation dwarfs any other institutional change in the history of South Africa (DPLG 2001). Since 1994, local government transformation has aimed at making municipalities more accountable, financially sustainable and able to deliver critical services. Municipal structures were reconfigured or created to include areas not previously served by local government, and to deliver infrastructure in a manner that would stimulate economic growth and reduce inequality (Cartwright 2003).

It is difficult to overstate the scale of the changes that municipalities underwent in the 1990s and beyond. These included the integration of racially-distinct municipal administrations, new structures for democratic and accountable government, new systems for improved operational and financial management, and an entirely new conception of the role of local government. Municipal boundaries were redrawn twice. South Africa’s new Constitution significantly altered the status, powers and functions of local government, and redefined it as an autonomous sphere of government that had developmental duties that extended beyond its core service functions and included ensuring the economic and social welfare of its constituents. The 1998 White Paper on Local Government detailed this vision of ‘developmental local government’ as, ‘working with citizens and groups within the community to find sustainable ways to meet their social, economic and material needs and improve the quality of their lives’ (RSA 1998). This was followed by a systematic overhaul of legislation. By late 2000, 843 pre-existing municipalities had been consolidated down to 284, and classified into one of three categories – six became single-tier metropolitan municipalities; 232 became local municipalities, and 46 became district municipalities, made up of between five and eight local municipalities each.

In the former homeland areas, entirely new municipalities were created. They faced enormous pressure to deliver on their new mandate, as well as immense challenges in providing functional, viable services in a context of chronic poverty and under-development.

New boundaries led to major staff movements as personnel were transferred between newly-defined municipalities. Many posts were rationalised as existing municipalities amalgamated, and a moratorium was placed on the recruitment of new staff to key positions. The impacts of rationalising technical and engineering positions were particularly severe. The scale of these changes put great strain on structures that were already under-resourced, and there was uncertainty over jurisdiction, budgets and basic planning data. In parallel, water and sanitation infrastructure programmes were being run locally by different sector departments and agencies – DWAF, water boards and NGOs in rural areas, as well as the Department of Provincial and Local Government and municipal programmes in peri-urban and urban areas – with different messages and policies, different default service levels and different subsidies and grants. Municipal leaders, at times, had to intervene to explain to their constituents why some settlements, supported by different government programmes, were apparently getting preferential treatment, while in others residents had to contribute their time, materials or cash to the project roll-out. There was immense confusion and discontinuity as new systems began to take over from the old, and schemes and services began to be transferred from DWAF to local government.

In 2000, all district municipalities were declared Water Services Authorities, and many had to gear up from nowhere to develop policies and programmes to drive service delivery. Just 3 years later, in mid-2003, these authorisations were reversed in some areas when national government finalised the allocation of municipal powers and functions for water and other services, and designated 183 municipalities as Water Services Authorities. In some instances, municipalities which had been playing the role of both authority and provider, now had to hand over one or both of these responsibilities to another municipality, along with the staffing and resources that went with these functions. There were inevitable lags and lapses in the transfer of funds from national government – funds for capital expenditure might be assigned to the district municipality, while funding transfers for the recurrent costs of provision went to the local municipality. Equally, the infrastructure and equipment needed for service delivery may have been be registered as an asset of one municipality, while the responsibility for providing the service now lay with an entirely different structure. This led to confusion over where the responsibility for funding maintenance lay, and resulted in significant gaps in asset management and budgeting. In many municipalities, essential maintenance of infrastructure needed to support effective service delivery was simply neglected.

3.6 Fiscal and Financial Restructuring

The National Treasury, meanwhile, was steadily transforming the national fiscal and financial policy framework. One core objective was to increase the flow of funds through direct and indirect transfers to local government. Another objective was to strengthen municipal financial management and accountability systems, with the 2003 Municipal Finance Management Act elaborating on a range of mandatory systems and procedures to promote good governance (Savage 2007).

Two new local government funding mechanisms have particular relevance for water services provision – the Equitable Share, and the consolidated Municipal Infrastructure Grant (MIG). The Equitable Share was introduced in 1998 to give effect to the Constitutional requirement that provincial and local government should have an equitable share of national revenue, commensurate with their functions. It had three components, intended to support municipalities’ recurrent costs – a basic services grant, to subsidise basic services for the poor; an institutional capacity-building grant to support individual municipalities that were unable to raise enough revenue to establish their core administrative infrastructure; and an intergovernmental grant allocation, based on a proportion of grants paid in previous years. From 2001, largely in response to growing evidence that poor households were struggling to afford the cost of the new services being provided to them, the Equitable Share was significantly increased to accommodate the cost of the new Free Basic Water Policy of providing 6 free kl of potable water monthly to every poor household. The policy was announced in September 2000 to ensure that no poor person should be denied access to a basic supply of water based on affordability. This represented a significant shift in government policy, with government now co-funding a portion of the operating costs of water services, as well as electricity, waste removal and sewage.

The MIG, conversely, provided capital funding to enable municipalities to invest in the infrastructure needed to provide basic services to the poor. Introduced from 2004, MIG consolidated several different national funding streams into a comprehensive grant, with the amount available per municipality over the next 3 years, published each year. For the first time, municipalities could plan multi-year programmes with reasonable certainty regarding their grant funding allocations for subsequent years. MIG was based on a formula that took into account the number of people still requiring basic infrastructure. Over half of the annual allocation was earmarked for new water and sanitation infrastructure. The funds were allocated per municipality and could be accessed directly from the Department of Provincial and Local Government, rather than via the sectoral programmes of the different line departments.

The introduction of MIG also meant that from 2004, municipalities accounted to DPLG, not DWAF, in how they spent capital grants for infrastructure in the water services sector. DWAF’s role in relation to capital funding was limited to setting design standards and scrutinizing project technical reports during the preliminary design phase. This diminished DWAF’s influence over how projects were conceived, implemented and monitored. As municipalities took up their new mandate, with increased funding and autonomy, project planning and implementation became increasingly technicist, with less and less emphasis on the social capital and maintenance dimensions of sustainable services.

3.7 The Diversity of Local Government

It is important to understand the immense diversity in the form and capacity of the 283 municipalities nationally. There are three broad types of municipality: metropolitan, district and local. Metros have the most resources and the greatest degree of autonomy. Elsewhere there is a two-tier system of local government, with five to eight local municipalities (LMs) clustered under a district municipality, with widely ranging powers and functions. In some areas, the district municipality is the dominant authority, with primary responsibility for provision of services; in this case it is the primary recipient of transfers from government. Elsewhere, district municipality powers and functions are more limited, and its role is primarily co-ordination; this frequently leads to contestation around decision-making authority and allocation of resources.

National Treasury classifies municipalities nationally into seven categories, based on population, percentage of urban population, size of budgets and spatial context; this is useful for understanding the different challenges they face. Figure 3.1 shows the distribution of the different forms of municipalities, and the percentage of households nationally they serve.

Fig. 3.1

Types of municipalities

Poverty and service deficiencies are most acute in B4 municipalities in the former ‘homeland’ areas, with the most financially and administratively stressed municipalities falling in the B3 category (CGTA 2009e).

3.8 Targets and Backlogs

In the 1994 White Paper on Community Water Supply and Sanitation, government had promised universal access to basic services within 7 years. The scope and scale of the task was daunting, but there was no debate about government’s commitment to overcoming the inequities of the past. Since 1994, government has consistently tracked progress in extending access, and has committed vast resources to enable the achievement of universal coverage; alongside this, it has put immense pressure on the different agencies of government to extend services as swiftly as possible.

The 2003 Strategic Framework for Water Services – essentially an updated and expanded White Paper for water services, which reflected municipalities’ leading role in water services provision and DWAF’s changing role – included a range of new delivery targets. The two most important related to water and sanitation coverage: by 2008 for water, and 2010 for sanitation, all people in South Africa were to have access to at least a basic functioning service. This commitment featured prominently in the ANC’s national and provincial election campaign in 2004 and in its local government election campaign in 2006. The Mbeki-led administration (1999–2009) is credited with an emphasis on managerialism to achieve its delivery objectives, and progress in eradicating a range of backlogs – water, sanitation, bucket toilets, facilities in schools and clinics, and so on – was monitored closely in every sphere of government.

Access to services was monitored through tracking backlogs in access to infrastructure. This was a critical indicator of inequality and provided a useful index of performance in closing the gap; but it introduced a number of problems. Tracking the reduction of backlogs in access to water and sanitation made access to infrastructure the over-riding imperative, with the functionality of the infrastructure and the quality of the service provided secondary. Secondly, it focused spending on new capital development, frequently leading to neglect of maintenance and rehabilitation of existing infrastructure and, increasingly, of the new infrastructure as well. Thirdly, it diverted attention away from the long-term operating costs and requirements of different infrastructure options and service packages. With access to taps and toilets being provided at no cost to the beneficiaries, and municipalities receiving funds from national government for both capital and operating costs, the life-cycle costs of different service packages were seldom assessed rigorously – the priority nationally was to expand access to services as swiftly as possible, utilising funding made available by national government on a ‘use it or lose it’ annual basis.

The 1994 White Paper on Community Water Supply and Sanitation aimed for breadth of coverage, not depth, using the principal of ‘some for all’ not ‘all for some’: the intention was to achieve universal coverage with a basic level of service as the first priority, before providing higher service levels. But the Community Water Supply and Sanitation White Paper, and the White Paper on Basic Household Sanitation (drafted and influential from 1996, although it was only finalised in 2001) were perceived widely as DWAF policies that were applicable only in the rural areas served and supported by DWAF. Outside of dispersed rural settlements, most politicians and officials aspired to deliver significantly more than a basic level of service, irrespective of cost. The 2003 Strategic Framework for Water Services – developed largely by DWAF – re-affirmed the concept of breadth not depth as the first priority, and introduced the notion of a water ladder. Provision of at least a basic water service was the first step up the water ladder, but government was committed to progressively improving levels of service over time, moving on to intermediate levels of service as the next step – a yard tap, not a public standpipe, for example (RSA 2003).

In urban settlements, reticulated water and sewage networks were technically feasible, and it was hard to promote intermediate or differential service levels, like low-pressure water systems or yard taps, when white households in adjacent settlements had in-house taps and flush toilets. Moreover, consideration of the cost to poor households of different services packages was generally not a significant factor when planning new services. In many of the former homelands, services had been provided free, funded by the South African fiscus; and from the early 1980s, rent and service boycotts were used widely in South African’s townships to cripple local administrations perceived as illegitimate, and non-payment remained deeply entrenched. In Soweto, for example, less than 12% of residents were paying their water services bills in 2003 (Johannesburg 2003). Municipal officials and politicians taking decisions on service levels evidently assumed that grant funding and transfers would make good any deficit.

The new municipalities faced enormous pressure from their constituents, provincial and national government and the ruling party to extend service coverage, and worked hard to deliver; they provided high level services as the default in urban settlements. With government funding huge housing and infrastructure development, beneficiaries understandably wanted an in-house tap, not a yard connection or stand-pipe, and a flush toilet, not a dry toilet. Where a lower level of service was offered, residents frequently brought the project to a halt until there was a commitment from local politicians and officials to provide a higher level of service, either through sourcing additional funds and changing the output of the current project, or proceeding with the current project, with a promise to upgrade it within a defined period. Provincial housing delivery programmes provided free houses to poor families, with house taps and flush toilets as the default; in many areas new settlement development went ahead without even confirming that the municipality had the water supply or bulk infrastructure to support a large new housing development with high-level services, let alone the revenue to fund subsidised service provision.

Service coverage expanded steadily across the country, as MIG funding steadily increased. The notion of ‘backlogs’ was, however, become increasingly problematic. Government had set firm targets – universal access to water by 2008 and to sanitation by 2010 – but municipalities were finding that it was not simply a matter of pouring resources until full service coverage was reached. The backlogs were not static. The country’s population was growing rapidly, while average household size was falling; this meant that while the population grew by 20% between 1996 and 2008, the number of households grew by 39%, with profound implications for the number of households requiring service points.

In attempting to eradicate backlogs, government faced a moving target. Moreover, households themselves were moving. Migration dynamics are complex and highly varied, but the notion of urbanisation as an orderly one-way movement from rural to urban areas does not adequately characterise settlement dynamics in South Africa. The country has a long history of migrant labour, and even though the pass laws were scrapped in the 1980s, the extent of migrancy is now even greater than during apartheid. In the face of chronic unemployment and deep-rooted poverty, particularly in the former homelands, households pursue multiple livelihoods strategies to access income opportunities, with family members moving for varying periods to places perceived to offer better opportunities. Added to this, people come to towns to access better schools, medical care and housing, while others straddle a home in a town or city and a family base somewhere else where they might send their children or other family members for a range of reasons (Kok et al. 2005). One consequence is that many families need more than one service point. Moreover, many households move as work opportunities come and go; municipalities complained that while they might have eradicated all backlogs 2 years previously, the situation subsequently was entirely different.

Tracking backlogs became profoundly politicised in the second decade of ANC government, as senior politicians committed themselves to ensuring that targets would be met, and respective Water Affairs Ministers and senior officials exhorted municipal representatives to intensify their efforts to meet sectoral targets. Meeting the backlogs was increasingly becoming a numbers game, with less and less connection to access to good quality – let alone sustainable – services. DWAF, for example, compiles data which is quoted widely by the Presidency and elsewhere; backlog reduction is tracked against a 1996 baseline using project implementation data. Figures reported for the financial year ended March 2009 indicated that 96% of households had access to water supply infrastrucfture, up from 59% in 1994 (DWAF 2009a). In a footnote to a table of figures, DWAF sounded a caveat: the figures showed that 96% of households had access to the enabling infrastructure, but not necessarily to functioning services. Closer reading of the data reveals that the number meeting the RDP minimum standard was 91%.

However, this indicator excludes informal settlements, because improved water services for shack-dwellers is the responsibility of provincial Departments of Human Settlements through new housing developments or in-situ settlement upgrades. DWAF does not regard improved water services in informal settlements as its responsibility, and therefore excludes at least 10% of the population when reporting on access to water services nationally. Relatively few people are aware of the precision of DWAF’s reporting indicator: it tells us that 86% of people (acknowledging the omission of people living in informal settlement statistics) have been reached by infrastructure development programmes. What a figure of 96% suggests is that the goal of universal coverage has virtually been achieved, allowing some room for complacency. This means it is the wrong indicator, because it fails to reflect the level of crisis growing in South Africa’s water sector.

3.9 The Growing Crisis of Water Services

The nature of this crisis has many facets, and a flurry of government reports has quantified its dimensions.

3.9.1 Access to Basic Services

Access to a basic water services remains poor for those in the lowest quintile of the population by income. Just 41.6 % of households in the poorest 20% of the population by income level had access to piped water in 2006, according to the 2006 Stats SA General Household Survey (Statistics South Africa 2008). Notwithstanding immense effort and expenditure by government, not much has changed for South Africa’s poorest and most vulnerable people since 1994. In 2008, six municipalities had water services backlogs above 70% of households, and 46 – mostly small municipalities with populations under 50,000 households – reported backlogs of over 40% (CGTA 2009c). Moreover, the distribution of water backlogs has barely changed in the past decade. The greatest backlogs are still in former ‘homeland’ rural areas in the three poorest provinces (KwaZulu-Natal, Limpopo and the Eastern Cape) and still twice as high as in any of the small towns or cities in the rest of the country – including major metropolitan areas where there has been significant growth in informal settlements. The bulk of the task of eradicating service backlogs continues to lie, primarily, with the municipalities least resourced to deal with the challenges.

As the head of the department responsible for Local Government told Parliament in June 2009, ‘Service delivery to the poor remains our greatest challenge’ (Africa 2009).

3.9.2 Quality of Service

Despite significant service improvements in some municipalities, the general trend is not positive. The percentage of households who rated the quality of water services provided by local municipalities as ‘average’ or ‘poor’ increased from 24% in 2005 to 39% in 2008 (Stats SA 2009b). Households who reported water interruptions at least once a month or more often increased from 19.3% in 2002 to 31.4% in 2008, with figures in the Free State Province trebling, from 16.7% in 2002 to 42.6% in 2008 (Stats SA 2009b); this may be related to the rapid increase in water-borne sanitation coverage associated with the bucket toilet eradication programme, in a context of widespread water shortages (See Chapter 4 for further discussion of the bucket eradication programme.)

Evidence of declining water quality in some areas is of particular concern, given the high vulnerability to water-borne diseases of people with compromised immune systems. Typhoid killed at least 13 people in Delmas, near Johannesburg, in mid-2005, and over a thousand cases of diarrhoea were reported 2 years later when problems with chlorination recurred (DWAF 2007b). In April 2008, over 140 babies and infants died in the uKhahlamba district of the north Eastern Cape from a combination of poor nutrition, faecal contamination of water and inadequate hospital treatment (DoH 2008). In the summer of 2008/2009, cholera spread from Zimbabwe into Limpopo and Mpumalanga provinces and beyond, causing the deaths of at least 51 people in South Africa. The rate of infection was exacerbated by water services failures in some Limpopo municipalities, through delivery of unsafe water, or no delivery at all. A senior official of the Department of Health told members of the Parliamentary Portfolio Committee on Water Affairs in February 2009 how problems in local formal water supply systems had worsened the epidemic: inadequate chlorination, poor maintenance of treatment works and pump stations, interrupted water supplies, provision of raw water through taps; where water supplies failed, local residents reverted to untreated water from boreholes and rivers, some of which were contaminated by poor municipal wastewater treatment or sewage spills (Benson 2009).

In early June 2009, eight villagers died in the Eastern Cape village of Mpheko, near Mthatha, after drinking contaminated river water when the municipal water reservoir ran dry. Improved services and new housing projects in the area promoted in-migration and rapid growth in many small settlements, far beyond the design capacity of the existing water supply infrastructure. Intermittent municipal water supplies were reported in Mpheko Village from December 2008, and many households reverted to using local springs. But severe drought by mid-2009 meant that most local groundwater sources were dry, leaving those without access to municipal water to draw from local rivers. The deaths followed an outbreak of diarrhoea and vomiting in later May 2009 (SAPA 2009; Groenewald 2009; Daily Dispatch 2009; Yeld 2009).

These problems are likely to worsen. A March 2009 Water and Sanitation Audit Report, commissioned by the Minister of Provincial and Local Government, found that 85% of the country’s wastewater treatment works had a limited remaining useful life, while 90% of water treatment works were dilapidated (EU Municipal Outreach 2009); in April 2010, the Minister of Water Affairs formally requested R23-billion over the next 6 years from National Treasury, and noted that the full amount needed was close to double that (SAPA, 2010). However, at issue is not only the state of infrastructure, but the skills needed to run treatment works. A 2009 assessment found 114 municipalities grossly non-compliant with regulations stipulating the minimum qualifications levels needed for process controllers, plant supervisors and maintenance teams in treatment works (DWAF 2009b).

More generally, there is serious concern nationally about the competencies of personnel running municipal water services in many municipalities (Muller 2009). To a large degree, water services rest on public health engineering skills. But many municipalities have under-estimated the organisational requirements for effective water services provision, and municipal skills shortages are getting worse. In 2005, 83 municipalities employed no engineers at all, in any services (Lawless 2008). Four years on, the situation is far worse, with nearly 100 municipalities now employing no engineering professionals at all; overall, there has been a 10% fall in the number of municipal engineers since 2005, despite a significant expansion in service coverage. Just 44 municipalities out of 284 – 15% – employed registered professional engineers (Lawless 2009). Inappropriate appointments impact across the delivery chain, from planning, to design, to operational management, maintenance planning and so on, and impact on the ability of the technical services department to lobby successfully for adequate funding; collectively, these factors shape the quality of local service provision profoundly.

3.9.3 Limited Municipal Capacity to Deliver Water Services Effectively

Perhaps the most telling indicator is the finding of a October 2009 risk assessment compiled for DWA, which found that wastewater services in 23 municipalities were in a state of crisis, with an acute risk of disease outbreaks; a further 99 municipalities were at high risk of entering a state of crisis by mid-2010 if no turnaround is achieved (Fig. 3.2).

Fig. 3.2

Categorisation of municipalities by wastewater management risk rating

A further assessment in March 2010 confirmed the projected deterioration, and showed that the rate of decline was even greater than anticipated. The assessment looked primarily at technical and operational risk factors, and gave particular emphasis to compliance with wastewater treatment requirements. The list of municipalities at risk or high risk included the full spectrum of municipal categories, including two of the biggest metropolitan municipalities. The assessment is highly significant, because it counters the usual assumption that it is primarily the weakest municipalities, serving predominantly rural populations that face the gravest sustainability problems. Some of the most severe performance deficiencies are in secondary cities, with the most widespread problems found in municipalities serving predominantly small towns (CGTA 2009e; DWAF 2009b) (Fig. 3.3).

Fig. 3.3

Wastewater management risk rating by type of local municipality

Whereas the greatest challenges in largely rural municipalities lie in providing access to basic services, largely through communal standpipes and VIP toilets, the challenge in more urbanised settlements relates to the more demanding technical challenges inherent in operating and maintaining reticulated water and sanitation services; at issue is the level of service provided. Compounding the O&M challenges are the higher operating costs and the need for more elaborate billing and collection systems, and the financial implications of providing high level services in a context of significant poverty and high unemployment. Under-investment in maintenance, refurbishment and expansion is eroding the ability of these municipalities to provide adequate services.

There is widespread evidence that MIG has funded the development of new infrastructure which is now incurring maintenance costs beyond what municipalities have budgeted for; widening cost-recovery gaps are undermining the ability of municipalities to fund infrastructure expansion, rehabilitation or renewals outside of low income areas, and compromising their ability to raise loans. Thus an unintended consequence of MIG in some municipalities is that it is starting to impact on the state of overall economic infrastructure of municipalities; if services in the commercial and middle class areas deteriorate, they could cripple local economic development and the revenue base on which the municipality depends for wider service provision.

3.9.4 Growing Municipal Dysfunction

The Constitution assigns responsibility for delivery of basic services to local government, yet there is widespread evidence of severe dysfunction in the majority of municipalities. This impacts on municipalities’ ability to plan and deliver services, and to manage their finances to support sustainable provision of services.

Structural weaknesses account for many of the challenges municipalities face: local government has been given an exceptionally wide-ranging and challenging mandate, yet many of the administrations are less than 10 years old, and have had to establish themselves as administrations in areas where it is hard to attract capable professionals; they face enormous challenges arising from decades of neglected investment and development, and an inadequate resource base to support the functions they must perform.

However, many of the challenges described above result from sheer mismanagement. This in turn is related to inappropriate appointments to meet employment equity targets, deployment of ANC cadres in senior positions for which they are not qualified and decision-making and resource allocation on the basis of party and factional politics rather than objective assessment of the requirements for sound performance (CGTA 2009e). These points have been made by the President, by Cabinet Ministers, senior government officials, and in a number of reports released in late 2009 which focused on the dire state of local government.

There is extensive evidence of weak financial management and poor management capacity in the majority of municipalities nationally. Analysis of municipal operating budgets for 2008/2009 shows that 24 municipalities overspent their operating budget to the value of US$350 million; more significantly, 166 municipalities underspent available funds by US$1.7 billion (National Treasury 2009b). This suggests that poor financial management is a greater challenge than a shortage of funds to provide services to people living in poverty.

There is a significant shortage of financial professionals in municipalities, and a high turnover of staff in all professional categories. Just one in five of 253 municipalities audited for the 2006/2007 financial year received an unqualified audit (Shiceka 2009). Without adequate financial planning and financial controls, cash flows are vulnerable, and a growing number of municipalities face bankruptcy and an inability to pay creditors. “A very significant risk going forward is that municipalities’ spending plans outstrip realistically collective revenues,” noted a major assessment of the state of local government in October 2009 (CGTA 2009d).

Worse, there is evidence of widespread corruption in municipalities, and abuse of political office and job status for personal gain (Ibid.) In August 2009, Yunus Carrim, Deputy Minister of the department responsible for local government, phrased the problem succinctly in an interview with a journalist (Carrim 2009a):

We didn’t anticipate the extent to which power struggles within municipalities would paralyse service delivery, and power struggles between local and district municipalities would undermine the two-tier model. And we didn’t, just didn’t, foresee the extent to which municipalities would become the soft underbelly of patronage and corruption in our country (Brown 2009).

The report of a national assessment of the state of local government noted in October 2009 noted that ‘a culture of patronage and nepotism is now so widespread in municipalities that the formal municipal accountability system is ineffective and inaccessible to most citizens...There is now a lack of citizen confidence and trust in the system’ (CGTA 2009d).

These realities underpin the surge of street-level protests across South Africa in 2009.

3.9.5 Protest Action

There were almost as many community protests in 2009 (105) as in the previous 5 years put together (Municipal IQ 2010); the number of protests doubled compared to 2008 (CGTA 2009d). A large part of the reason lies in the explanation given to delegates at a meeting of local government officials in mid-2009 by an advisor to government:

Our communities have been neglected and regarded as passive participants in issues of governance. As a result, no dedicated effort has been given to societal structures in order to deepen democracy. Our people on the ground are taken for granted by service delivery points, thus leading to fierce confrontation between local authorities and communities; e.g. widespread riots in townships and villages (Nkontwana 2009).

In setting bold service delivery targets to overcome decades of under-development, government has created the expectation that local government can and will deliver. Faced with enormous challenges of scale and urgency, most municipalities have opted for a technocratic top-down approach to delivery, with decisions taken at high level and implemented with little public involvement or communication. But many municipalities lack the skills needed to succeed with a technocratic approach; in too many instances, the result has been non-delivery, or development of poor quality infrastructure without the resources to keep it working. Moreover, the approach has emphasized funding inputs and infrastructure outputs, not service delivery outcomes. Technology choices and implementation options have been limited, and options for customising service delivery options to address locally-identified problems and needs have often been overlooked.

Ward committees, established at sub-municipal level, are the primary forums through which public engagement is meant to occur. But ward committees are discredited and dysfunctional in large parts of the country. Councillors are frequently unresponsive – or unable to respond – to issues raised directly by citizens, fuelling growing frustration, mistrust and anger (CGTA 2009a).

Galvin and Habib (2003) note that South Africa has indeed decentralized delivery, but has opted for a highly state-centric approach, through municipal structures, rather than a more integrative and inclusive model which would enable it to harness the support and creativity of people in planning and sustaining services that meet their needs. To a large degree, ordinary people have become marginal to the process of municipal service planning and delivery, and, as the RDP warned presciently, have indeed become the objects of development (ANC 1994).

3.10 Towards a Turnaround

3.10.1 The Local Government Turnaround Strategy

Confronted by increasingly violent protest action, from mid-2009 the new administration under President Zuma undertook a wide-ranging assessment of the state of local government. Provision of decent services is the most important function of local government, yet the performance of many municipalities has been very poor. Facing national local government elections scheduled for early 2011, government has given priority to driving a comprehensive turnaround strategy for local government, with a strong emphasis on strengthening governance and accountability. The approach was endorsed by Cabinet in December 2009, and within 3 months, by March 2010, every municipality in the country was required to draft its own turnaround strategy to remedy problems within its area of jurisdiction. The strategy has five core objectives:

• Ensure that municipalities meet the basic needs of communities, with systems to accelerate quality service delivery within the context of each municipalities conditions and needs

• Build clean, responsive, accountable local government

• Improve functionality, performance and professionalism in municipalities

• Improve national and provincial policy, support and oversight to local government

• Strengthen partnerships between local government, communities and civil society (CGTA 2009f)

Effective water services depend very largely on capable local government authorities, and thus the local government turnaround strategy has critical implications for a turnaround in water services. But the water sector faces very particular challenges of its own. What has been learned over the past 15 in South Africa?

3.10.2 Some Lessons from South Africa’s Experience

If water services are a municipal responsibility, capable municipalities are a prerequisite for good services.

Across the infinite diversity of South Africa, municipalities which are doing well in delivering water service have good leadership, the right skills, effective communication strategies, sound financial management and strong accountability systems. Where the importance of any one of these is underestimated or neglected, the impacts are evident in service deficiencies.

One size does not fit all. Differentiated approaches are needed which recognise strengths, weaknesses and varied abilities across the entire spectrum of institutional structures. Institutional models for water services work best when they are developed on the basis of robust, comprehensive local assessment of what the key challenges are and how best to meet them.

Institutional restructuring is complex, risky, expensive and enormously disruptive to service delivery. Some form of institutional reform may be necessary to make better use of available resources in particular areas, but restructuring should not be the default response. Wherever feasible, the emphasis should be on rebuilding institutions, not restructuring. Many of the current weaknesses stem from poor accountability systems and inappropriate appointments, and can be remedied. There is considerable scope to make better use of the skills and competencies that are available, and to appoint people with the professional and technical competencies required to achieve effective and sustainable services.

Institutional continuity is vital for effective service provision, as it can take many years to develop the systems and competencies needed to deliver effective services. At an individual level, high turnover of staff is profoundly disruptive, because it takes several years for a new senior manager to build the knowledge base and experience needed to perform effectively on the job. Moreover, DWAF has invested enormous resources in support programmes to build the competencies of water services authorities, but the benefits are short-lived where key officials change jobs frequently.

Political representatives and service providers have distinct and separate roles. Councillors set the strategic direction and determine policies, and service providers are tasked with delivery of services in line with that strategic mandate.

The separation of Authority and Provider functions which underpins the draft regulatory strategy for water services has been achieved in only a minority of municipalities. However, DWAF’s current emphasis on tracking key service outcomes – notably the incentive-based Blue Drop and Green Drop certification process, whereby municipalities that score highly across a range of requirements for good water and wastewater treatment – is delivering very positive results. This suggests that regulation is possible without a formal separation of WSA and WSP roles; what matters most are clear performance targets, sound operational procedures, effective performance monitoring and consequences for poor performance.

Outcomes are even more important than outputs. Enormous investment in water services infrastructure does not necessarily deliver sustained improvements in service delivery. There is substantial evidence of new infrastructure becoming dysfunctional within a very short time because of a lack of personnel with the requisite skills and competencies to operate and maintain that infrastructure. Equally, services with high running costs are being provided in many areas without adequate regard for the ongoing income required for viability. The combination of poverty, poor revenue management and inadequate funding support from the fiscus contributes significantly to service breakdowns.

Access to sufficient bulk water supplies, expansion and upgrading of bulk infrastructure and renewal of ageing networks is as necessary for improved service delivery as new taps and toilets. Many rural settlements continue to draw their water, untreated, from streams, because there has been no source development and regional bulk networks cannot meet demand; some housing projects have stalled, or have been abandoned and vandalised, because there is insufficient water to supply them, while the consequences of providing waterborne sanitation extensively without adequate water supply or waste treatment capacity is evident in growing supply interruptions and eutrophication of rivers. Upgraded services attract new settlement, with the potential to result in supply bottlenecks. In even the biggest metros with the best performing utilities, leaks and bursts from decayed pipe networks lead to pressure drops, water outages and compromised water quality. The scale of investment required vastly exceeds available funding.

The real costs of sustainable water provision are not reflected in the current pricing system, across the entire value chain from source to tap and back. There is no coherent pricing strategy for the water sector as a whole; DWAF’s pricing strategy focuses on raw water, and each water board and municipality has its own approach (see Chapter 9). The result is a wide range of pricing approaches and tariff levels, with under-recovery of real costs and across the sector as a whole, and severe under-investment in asset management and renewal. One immediate indicator is the extent of leaks and losses resulting from decaying infrastructure, in a context of growing water demand and looming water scarcity. Two of South Africa’s biggest cities, with the best-run water utilities, have Non-Revenue Water percentages well into the 1930s. This raises questions about the extent of real losses in municipalities with less sophisticated monitoring systems, and the quantum of funds required nationally to renew ageing networks – and instal comprehensive metreing systems.

Growing water scarcity requires a far stronger emphasis on water conservation and demand management to improve use efficiencies and cut avoidable losses.

Most municipalities do not ring-fence their income and expenditure for water services, and so do not know what it costs them to provide water services. Tariffs are frequently set at levels far below the real costs, and budgets are balanced largely by neglecting essential maintenance and forward investment. Compounding this, most municipalities use an accounting approach to tariff setting, based on balancing their annual budgets, rather than a financial approach which takes account of the real costs of long-term sustainable supply – which includes comprehensive asset management, with provision for rehabilitation, renewals and upgrading of infrastructure.

Growing grant dependence is masking significant inefficiencies in many municipalities. There is no question that many municipalities require additional funding support from the fiscus to provide decent services in a context of chronic poverty; however, where citizens and municipalities pay only a fraction of the real cost of services, their incentives for using water efficiently, reducing Non-Revenue Water and delivering services cost effectively are reduced. Water services need to be run more like professional business organisations – not to make a profit out of poor people, but to ensure that expenditure is matched by income, that cash flows are sufficient to fund operations throughout the year, that procurement needs are dealt with promptly, that provision is made to rehabilitate or replace depreciating assets and that there is a strong emphasis on providing services that meet people’s needs.

Reliance on grants and transfers has shifted the focus of reporting and accountability away from the relationship between municipalities and the citizens they serve, to the relationship between municipalities and other spheres of government. It is imperative that a new relationship of mutual accountability is negotiated between councillors, officials and citizens, municipality by municipality, based on frank dialogue about where current challenges lie and what is needed to remedy them. Equally, the structure of government is premised on spheres, not tiers, of government; effective inter-governmental relationships require mutual accountabilities.

Service upgrading in informal settlements is linked to comprehensive settlement upgrading, but settlement development and housing delivery is progressing far more slowly than anticipated. One consequence is that millions of people live in limbo in informal settlements, with very uncertain futures: when will they get the free new house they have been promised? National housing policy advocates in-situ upgrading wherever possible, but in-situ development is often more complex and protracted than greenfields development, and thus does not provide fast-tracked solutions. Meanwhile, services in most informal settlements are extremely poor – and 38% of recent service protests stem from informal settlements (CGTA 2009d). There is an urgent need for incremental improvements in service provision in informal settlements, until such time that better housing can be developed.

Quick fixes seldom deliver lasting benefits. A range of interventions are needed to address challenges, and some can be implemented very effectively in the short term. But a long term perspective is needed to guide the range of complementary initiatives the sector needs to build a solid, sustainable base for effective service delivery.

South Africa’s water services sector could be approaching a perfect storm, with consequences far more serious than those that have rocked the country in the electricity sector.

3.11 Strengthening Water Services

The need for a turnaround in municipal administration and governance is widely acknowledged. While this is necessary for an improvement in water servicing, it is not necessarily sufficient. Equally, there are questions about how best to achieve a turnaround in water services, in a context where water services delivery is inextricably linked to municipal powers and functions. Regardless of how well a water services provider performs operationally, in the South African context it relies on the municipality for billing and revenue functions, and it is the municipality that sets the tenor of the utility’s relationship with its customers.

On the other hand, turning around a municipality takes time, and immediate interventions are needed in many municipalities to strengthen water services provision. Take the case of Emfuleni Local Municipality, on the banks of the Vaal River south of Johannesburg. For over a decade there have been severe and worsening sewage spills into the river, with total faecal coliforms – a measure of sewage contamination – exceeding 4,000,000/100 ml at one stage (Rand Water 2002–2009). The reasons stem largely from municipal mismanagement. One remedy proposed in the early 2000s was to separate out the water services function from the rest of the municipality, and establish a dedicated municipal-owned entity, like Johannesburg Water (Pty) Ltd, to run water services. National Treasury opposed this, on the grounds that it would be better to turn around the entire municipality. Enormous resources have been invested in municipal support and restructuring initiatives, but the results have been disappointing, with little significant improvement in the performance of the municipality or its wastewater management.

The following sections reviews some options for strengthening water services provision.

3.11.1 Technical Support

There have been a number of valuable technical assistance programmes in recent years which target municipalities and their service functions. One prominent initiative is Siyenza Manje, run by the Development Bank of Southern Africa, where professionals are assigned to struggling municipalities to provide short-term support. To date, over 600 professionals have been deployed in municipalities around the country. However, this relief is insufficient to achieve lasting change, and some who have worked on the Siyenza Manje programme complain that municipalities do not necessarily wish to follow their advice or act on the evidence of corruption they find, and that local politicians frequently overrule the decisions of officials; moreover, some municipalities claim that they have lost technical staff to the Siyenza Manje programme, causing problems where previously they did not exist.

Technical assistance is all about inputs; what is needed is greater debate about how best to achieve the outputs and outcomes that are needed, with a far stronger emphasis on improved performance management.

3.11.2 Professionalisation of Water Services Provision

Achieving a lasting improvement in performance outcomes requires institutional reforms, and greater professionalisation of municipal water services. This ranges from recruiting the necessary skills and competencies, to a greater emphasis on performance contracts and service delivery outcomes, to ring-fencing the finances and ideally administration of the water services function, through to the establishment of separate utilities in some cases.

An obvious requirement is to insist that municipalities appoint personnel with the appropriate professional and technical expertise, whether at management or supervisory level, or through appointing works operators with the skills specified in sector regulations. DWAF is considering introducing mandatory minimum qualifications for senior water services personnel, possibly with accreditation through a professional body (H. Muller, 2009a, personal communication, 10 December 2009; M. Muller 2009).

3.11.3 Regulation

Strong sanctions for weak performance are a powerful driver of institutional reforms, but water services regulation is still evolving. The Department of Water Affairs is the sector regulator, but its emphasis until recently on “developmental regulation” – i.e. supportive engagement with municipalities to remedy problems – blurred the line between assistance and enforcement (or even intervention). Further, the Constitutional principle of cooperative governance between the three spheres of government has left the national sphere reluctant to intervene decisively at the local sphere, let alone prosecute municipalities who fail in their service obligations. One consequence is that there are few sanctions for municipalities who do not comply with sector legislation. There is evidence of DWAF taking a tougher stance, through issuing directives to a growing number of municipalities and requiring them to formulate action plans to remedy non-compliance; court action is currently a last resort, and seldom used. In practise, however, court action solves very little unless individuals are held accountable for poor performance, and to date no individuals have been prosecuted.

Given the extent of the crisis in municipal water services, it is very likely that DWAF’s regulatory powers will be strengthened, with a greater emphasis on enforcement and penalties for municipalities that do not comply. Further, acknowledgement of the crisis has opened a space to review the powers and functions of a municipality where it is not able to perform its function, with the possibility of mandatory restructuring its water services function; alternatively, it could be compelled to bring in a professional service provider. Without strong sanctions for poor performance, the incentives for a turnaround are limited.

There is, nonetheless, heartening evidence of better water quality management, spurred by regular monitoring and publication of municipal performance. An electronic Water Quality Management System tool, eWQMS, is now being used by every Water Services Authority in the country, with an average of 90% of municipalities submitting data each month. And in mid-2009, DWAF awarded the first Blue Drop and Green Drop certificates, to municipalities achieving at least 95% and 90% compliance, respectively, across a number of weighted performance criteria for management of water and wastewater quality. DWAF believes that introducing simple indicators for two key performance areas will ease the regulatory burden on the Department (Manus 2008).

Until recently, every municipality in the country liked to claim that the water they supplied complied with the requisite treatment standards, but far fewer could provide the data to prove it; in 2005, just 42% of Water Services Authorities were monitoring drinking water quality, but this had grown to over 90% by 2008 (DWAF 2008), spurred by the introduction of eWQMS (electronic Water Quality Management System), an open-source, web-based tool for capturing, disseminating and managing data on water and wastewater quality. The tool, introduced nationally from April 2006 after application initially in the Free State province, came with extensive DWAF-funded hands-on support to municipalities to help them to collect and capture the data and respond to the results. The tool enables municipalities to load the results of all tests onto the web each month, and draw reports on the results which flag compliance with mandatory standards. The data is forwarded directly to DWAF, as sector regulator (Mackintosh et al. 2008).

The results have been dramatic. Weaknesses have been revealed in many areas, but far more important is the impetus and encouragement given to municipalities to measure and track their performance on a monthly basis. The layout of eQWMS reports guides municipal technical staff in ensuring that all basic water quality management requirements are prioritised and implemented.

eWQMS currently focuses on large-scale municipal water distribution systems, but the approach is now being extended to address the thousands of small localised boreholes which fall outside of mainstream water quality management systems. With support from the World Health Organisation and the Gates Foundation, work is now being done on the development of simple test kits that can be used in remote areas to assess free chlorine levels, turbidity, pH and the presence of faecal coliforms. The aim is to use mobile phone technologies to input the data directly to a central database from where it can be assessed and acted on (Moorgas et al 2009).

Of course, eWQMS cannot compensate for inappropriate staffing or lack of funds for system rehabilitation; regulation is a more appropriate lever for institutional reform or budget re-prioritisation. However, eWQMS has provided the information management and reporting system needed at municipal level to enable DWAF to regulate water quality nationally. It has also laid the basis for the introduction of the Blue Drop and Green Drop regulatory system from 2008, which aims to affirm good performance, and mobilise public pressure in municipalities which do not meet compliance requirements. The first round emphasised a ‘name and praise’ approach, with public affirmation of the 22 authorities which met the ‘Blue Drop’ standard; poor performance at the vast majority of wastewater treatment works overshadowed the achievements of the 32 works (out of more than 800) that were awarded Green Drop certificates in 2009.

3.11.4 Alternative Institutional Models

South Africa’s experience in setting up external, stand-alone water utilities has been mixed. The experience of Johannesburg Water (Pty) Ltd, wholly owned by the City of Johannesburg Metro Municipality, and supported for 5 years through a very productive management contract, illustrates the benefits of setting up a professional, commercially-oriented utility. These include the ability to focus on water services, provide a potentially more attractive work environment, greater flexibility in recruitment and procurement, and a clearer separation between political and technical functions. However, there are also significant risks and costs as experiences elsewhere have shown. Moreover, the experience of Ilembe District Municipality, which uses a private sector concessionaire in one area, shows the critical importance of strong capacity in the municipality to manage and monitor its service contract with the utility and support effective communication with customers (Galvin 2009); even with outsourcing, responsibility for ensuring good services remains with the municipality.

To date there has been very little discussion of the role of non-municipal role-players other than water boards following a backlash against a pro-privatisation lobby in the 1990s. Privatisation, through the sale of public assets required for the delivery of basic services, is explicitly prohibited in the 2003 Municipal Finance Management Act, and most municipalities and the labour movement are strongly opposed to delegating management of water services to non-public service providers.

A growing number of municipalities are drawing on Water Boards, or regional bulk water providers, to supplement their services capabilities. There is an important role for water boards in supporting service delivery by municipalities, where they have the necessary retail servicing competencies to do so; however, the capabilities of water boards vary widely and some are facing significant performance and sustainability challenges of their own. Water Boards are a particularly attractive support option and partner for many municipalities, because competitive tender procedures are not required when appointing public entities; this makes it easy for municipalities to bring in supplementary capacity fairly quickly. However there are growing questions about whether this is the most effective approach, and whether municipalities (and tax-payers) are getting adequate value for money.

In municipalities serving people living primarily in rural settlements, there is some acknowledgement of the need for local delegated management arrangements which involve local civil society groupings working with small and medium enterprises (CGTA 2009b). Welcome and necessary though this approach is, it does not address the need for a step change in South Africa’s approach to managing water services. Providing good quality water services is far more complex than is generally acknowledged. It requires considerable technical and managerial expertise, and a firmer emphasis on achieving service outcomes that are sustainable and affordable to the country as a whole.

Increasingly international debates are moving beyond a polarisation between public-sector and private-sector led approaches, to discussion of what the nature of partnering relationships should be, and how to make them work to serve those most in need of services. This is not to suggest that the answer to South Africa’s water services problems lies in contracting the private sector; the current challenges are far more complex and diverse than a simple resort to market-driven approaches could remedy. Moreover, there are examples of good and bad private sector entities, just as there are examples of good and bad public sector entities. At issue is how available resources – human and financial – are mobilised and configured, and what kinds of partnerships might prove effective in different contexts – perhaps public-public or public-private outcomes-based management contract, or a public-private partnership with delegated management of a publicly-owned treatment works, or a public–public-CSO or public–private-CSO model to strengthen service delivery in rural settlements located some distance from the municipal administrative hub, as proposed in a recent MIG review (CGTA 2009b) and so on; and how service providers are held to account to ensure that the needs of all users – particularly those of the poorest and most vulnerable citizens – are met.

3.11.5 Improved Financial Sustainability

Government faces infinite demand from municipalities for funding support for capital and operating expenditure, because of a combination of mismanagement, poor revenue collection and the need to provide subsidies for households receiving services at a level they could not otherwise afford. Greater professionalisation of municipal water services provision, with improved performance efficiencies, is essential, because the cost of the current approach is increasing unsustainable. Growing climate variability will add a range of further management costs, and the combination of growing water scarcity and deteriorating water quality means that containing costs and keeping water affordable to all users is imperative.

Municipalities are looking to government to fund water services infrastructure development to a degree not envisaged in any existing funding frameworks. MIG funded an estimated US$2.9 billion in water services infrastructure between 2003–2009 (DWAF 2009a), but Eastern Cape municipalities told the Minister of Water Affairs in July 2009 that they need US$5.6 billion in their province alone to repair and rehabilitate ageing water and sanitation infrastructure, with similar amounts requested from Limpopo (Hennop 2009). Without improved investment in maintaining existing infrastructure, the amount required for rehabilitation will grow. DWAF, meanwhile, estimates that US$10.8 billion is required to address bulk water infrastructure needs in municipalities (Van Zyl 2009), with at least US$3 billion needed for refurbishing and upgrading wastewater treatment works.

Funding from the private sector is an important source of additional capital funding for municipalities, but banks are wary of lending money where the risks are high, where they are not confident of a municipality’s ability to repay a loan and where they have little confidence in current service provider mechanisms. Sourcing the additional funds that municipalities need – particularly for essential infrastructure development that falls outside the scope of MIG – needs to start with effective institution building. Improved billing and collection by municipalities is imperative, but with water tariffs set at sub-economic rates in most municipalities, even improved collections will be insufficient. Tariff increases raise concerns about the affordability of water to consumers already reeling from electricity price hikes. More immediately, water users will resist price increases unless they come with evidence of significant improvements in service quality.

As access to services has expanded, so too has the cost to municipalities of operating and maintaining those services. Municipalities planned to spend US$1.76 billion on water and sanitation in 2009/2010, compared to US$0.92 billion in 2003/2004; operating expenditure has doubled in just 6 years (National Treasury 2009b). Concurrently, municipal dependence on grants to fund their operations is growing. The share of service charges in the total operating revenue of local government declined from 49%t in 2003/2004 to 42.9% in 2009/2010, mainly due to the sharp increase in national transfers (Carrim 2009b), but also as a result of what National Treasury describes as ‘a lack of fiscal effort’ – i.e. poor billing and collection – on the part of municipalities (National Treasury 2008). In 2008, 57 municipalities received more than three quarters of their revenue from national transfers, and at least six relied on grants for 100% of their income (CGTA 2009e). Municipal debt soared to US$7.16 billion by mid-2008, with 60% of that amount owed by households (EU Municipal Outreach 2009).

Fig. 3.4

Grants and transfers to municipalities, 2004/05–2011/12

A further area of financial vulnerability for municipalities relates to the provision of Free Basic Water, which provides important support to poor and vulnerable households in line with government’s pro-poor policy objectives. The subsidy amounts to between US$3.5 and US$8 per household per month, depending on the volume of free water provided and the local real cost of provision. DWAF statistics suggest that 85.6% of households country-wide enjoyed access to free basic water in 2009 (DWAF 2009a); demand-side figures collected by Statistics South Africa suggest far lower coverage (Stats SA 2009a).

The original intention of the free basic water policy was to provide relief to poor households, but in practise it is extremely difficult to target poor households alone. But blanket application of Free Basic Water policies is becoming increasingly problematic in many municipalities where the cost of providing free basic water is greater than the resources allocated to fund it. In many areas under-funding is contributing to the deterioration of services; deteriorating services are decidedly anti-poor.

Many factors contribute to this. Through the Equitable Share, National Treasury allocates substantial funding intended to cover the cost of a quantum of basic services to poor households, and transfers this directly to municipalities; municipalities do not necessarily use the Equitable Share to fund basic services to the extent required, and commonly absorb a large portion of the transfer into general administrative expenses, leaving a shortfall on the cost of providing free basic services.

A more complex problem is that Treasury assumes that municipalities can target the allocation of Free Basic Services to defined indigent households, and provides funding support accordingly. Treasury uses extrapolated 2001 census data to determine the number of indigent households in each municipality, defined at a relatively low income threshold, and allocates Equitable Share funds per municipality on that basis (National Treasury 2009a). But municipalities have their own definitions of indigency; Cape Town, for example, sets its threshold for qualifying households at a monthly income level that is three times higher than Treasury’s. This immediately results in a short fall between the funds available through the Equitable Share, and the number of households the municipality regards as eligible.

Moreover, municipalities cannot target poor households as readily as Treasury can quantify them. Targetting tends to rely on means-testing and municipal indigency registers, but these are onerous and very problemmatic, with substantial errors of exclusion and inclusion. Consequently most municipalities opt for administrative pragmatism and universalism; water from communal standpipes is provided free and unmetered, and elsewhere, municipalities use a rising block tariff, with the first tariff block set at zero for everyone. In theory, the cost of providing a portion of water free should be offset by cross-subsidies from tariffs charged in higher consumption bands. In practise, many municipalities do not charge a volumetric tariff, and thus the monthly service fee is unrelated to actual consumption. Even where municipalities do charge a volumetric tariff, very few beyond the six metropolitan municipalities have sufficient large volume paying customers to offset the cost of universal provision of free basic services; even fewer are implementing volumetric tariffs at the level required. Consequently there is a significant disjuncture between what the Free Basic Water policy aims to achieve, how the Equitable Share aims to support it, and what municipalities can implement practically on the ground. In short, sustainable provision of free basic water requires either significant local cross-subsidies, or a degree of administrative sophistication that is simply beyond the reach of many municipalities.

Refocusing free basic services to target a far narrower band of households will help to close the gap between income and expenditure, using currently available funding; but this is likely to prove extremely costly in political terms, and targetting raises complex challenges around exclusions. Other alternatives could tap funding sources beyond water tariffs, such as property rates, to support more viable universal provision, or link eligibility and benefits to social grants. There are no easy answers; but what is clear is that a different approach is increasingly necessary to safeguard the policy’s pro-poor intent.

3.11.5.1 The Phiri Court Case

In Johannesburg, the metro targeted Soweto for the first large-scale introduction of prepayment metres from 2004, because non-revenue water levels there were 67%, compared to about 20% in metered areas (Marin et al. 2009). Payment levels were extremely low – around 10% – and the extent of physical and commercial losses was unsustainable. Installation of the metres occurred in the context of an extensive infrastructure upgrading programme to augment supply and improve water pressure. Opponents of prepayment metres took the City to court, arguing that prepayment metres were unconstitutional, and that ‘silent disconnections’ when the free basic allocation, or available credit was exhausted, compromised people’s right of access to water. The Constitutional Court ultimately affirmed the Constitutionality of prepayment metres, provided that a reasonable amount of free basic water is provided. However the court case has had the effect of discrediting prepayment metres and legitimating non-payment for services, and metre bypasses and illegal connections have soared in Soweto. In June 2009 the city wrote off R2.8bn in bad debt, in what was the third major debt write-off in 8 years; steadily rising non-revenue water and water services bad debt contributed significantly to this amount.

Free Basic Water is a bold and important support measure, but it has no exit strategy and faces only growing demand; and with one in four South Africans now receiving a social grant, the cost of current poverty relief measures is vast and growing. A far-reaching shift in public perceptions of the value and cost of water is necessary if the sector is to avoid financial collapse. Illegal connections and metre by-passes are widespread, and service payments levels are far below what is needed to support good service provision. A more effective approach to communicating the challenges facing the sector is needed; building a culture of co-responsibility for service provision, premised on payment for services beyond the free basic amount, will require little short of a new social compact between government and citizens.

3.11.6 Building an Active Citizenry

Current debate about the underlying reasons for inadequate service delivery creates an important opportunity for South Africa’s people to reflect on how they have framed their relationship with government, and to explore new options for re-creating the relationship between government and citizens, both to strengthen democracy and to strengthen service provision. If citizens’ role is only to demand services and accountability from government, then they have rights with no reciprocal responsibilities (Mathekga and Buccus 2006; Nemeroff 2006). If the roles of citizens and government are more balanced, officials and elected representatives may be held more accountable, and citizens can make a greater contribution to good servicing; examples of their role ranges from reporting bursts and leaks, to paying for services, to not condoning water theft, illegal connections and metre bypasses, to shaping local planning and service improvements. A new partnership or social compact is needed between government and citizens. An important starting point is local dialogue, where politicians, officials and citizens from different constituencies come together to build understanding of the reasons for evident problems and jointly formulate strategies to address them (Galvin 2009).

Good governance involves more than government; this fact is acknowledged in the draft Water Services Regulation Strategy, which makes reference to the need for additional local ‘Citizens’ Voice’ initiatives which provide users with a forum to engage the municipality and its service provider around service concerns (DWAF 2007a). These user platforms have the potential to strengthen both local accountability mechanisms and the effectiveness of regulation at a national level, while also giving the municipality valuable feedback on areas needing urgent attention. A prerequisite is a structured local education programme, which takes both citizens and councillors through a series of topics – the water cycle, the national and local policy environment, the water services rights and responsibilities of citizens, and so on; this input provides a foundation for understanding where and why problems arise, and how to remedy them. Citizens’ Voice initiatives have been introduced in Cape Town, Ekhurleni, eThekwini and uMsinduzi, with strong demand from a growing number of other municipalities (WIN-SA 2009).

Water sector-specific initiatives like Citizens’ Voice are vital, and must be complemented with broader recourse measures – not least to assist citizens burdened with incorrect billing. But the far larger challenge is to reconstruct an engaged and active citizenry, where all the country’s people feel their voices are heard and respected. Given the extent of joblessness, experienced most acutely by the youth, and the structural nature of absolute and relative poverty in South Africa, this is no easy task.

3.12 Conclusions

Fifteen years on from 1994, South Africa is a vastly different country. The challenges facing South Africa today are far more complex than in the heady early days of liberation – competitiveness in the global economy, chronic unemployment, AIDS, structural poverty, skills gaps, electricity shortages, corruption, a breakdown in trust in local government, and so on. For far too many people, tangible change has not yet come to the degree they had hoped for, and their patience is wearing thin. Improved service delivery is non-negotiable, yet achieving it has proved to be far more complex than the country’s new leadership imagined.

Reforms in the water services sector have been implemented in parallel with far-reaching reform and restructuring of local government. Target-driven service delivery has focused on infrastructure, not people, and on capital projects, not sound operation and maintenance. The emphasis on meeting a critical national imperative – universal access to water services – has, to some extent, undermined the logic of decentralisation. Responsibility for delivery has been devolved to local government, but municipal accountability for delivery is to the centre, and to provincial and national leadership. The pressure on municipalities to meet targets and absorb large annual grants has substantially narrowed the scope for meaningful local civic engagement in deciding local needs, priorities and options, and building a sense of shared responsibility for the outcomes.

Good management of municipal water services is vital for social justice, growth and development and national water security. Climate change and unpredictable rainfall introduces new risks and uncertainties and raises the stakes. Meeting these challenges calls for water services institutions that are competent to deliver reliable supplies of safe drinking water in a context of deteriorating raw water quality, rising demand and growing scarcity, and which can manage the collection and safe treatment of wastewater without imposing harsh burdens on future generations. These issues underline the importance of cost-effectiveness and affordability in water services, nationally, to safeguard the rights of access of the most needy and vulnerable citizens, and to contain the cost to the state in a context of high and rising subsidies.

This chapter has reviewed government’s performance in acting positively to honour the Constitution’s promise of a right of access to adequate water for all. Service provision has become strongly state-centric; appointments are often shaped more by affiliation than competence; and decisions are taken too often on the basis of factional politics rather than professional assessment. Government is providing water services to an increasingly alienated citizenry, pursuing technocratic approaches which require a strong skills base and growing subsidies. In many areas, the nature and quality of the services provided fall far short of what citizens believe is reasonable. Widespread evidence of failures in water services delivery creates an important opportunity for South Africa’s people to reflect on how they have framed their relationship with government, and what power they have handed over. Some form of new partnership or social compact is needed between government and citizens, to strengthen both service delivery and democracy, and to harness the willingness and the commitment of the great majority of people, who want to contribute to making things work better.