But what almost everyone has missed about the plan is that it isn’t really a water plan at all. It’s a local government reform plan. Buried inside the technical language is an admission that for almost 30 years South Africa has worked on the assumption that municipalities should both govern water services and operate them, and the GNU has now concluded that the model has failed.
With the advent of democracy in South Africa, water ceased to be primarily an economic input and became a constitutional right. The National Water Act made the state the public trustee of the resource. The Water Services Act handed responsibility for delivering water and sanitation largely to municipalities. Free basic water followed soon afterwards as a noble policy built on municipal fantasy. Six kilolitres for poor households, funded by those who could pay, delivered by councils supposedly capable of billing, maintaining pipes and managing utilities.
That is the fault line running through today’s water crisis. The principle was progressive, but it ignored the fact that the machinery required to deliver it was often hobbled by poor governance.
The National Water Action Plan acknowledges that reality. So does President Cyril Ramaphosa in last week’s letter to the nation.
“The problem,” he wrote, “is that municipal water systems are not being properly managed, maintained and financed.” Water revenue is routinely diverted to other municipal functions, leaving too little money to repair pipes, replace pumps or employ qualified engineers. Ramaphosa’s conclusion is stark: “We cannot build our way out of the crisis if we do not properly maintain and manage the infrastructure we already have.”
Water security has increasingly become a defining factor shaping the future of economies
But hidden inside his sensible observation lies the idea of one of the most significant shifts in local government policy since democracy. The action plan proposes separating the municipality’s role as the water services authority from the entity that operates the network. Operators would require licences based on technical, managerial and financial competence. Where municipalities cannot deliver acceptable services, other providers — water boards, neighbouring utilities or other competent operators — could take over. Water revenues would be ring-fenced inside the utility instead of disappearing into the municipal general ledger.
This isn’t privatisation, despite what critics will inevitably claim.
Sean Phillips, director-general of the department of water & sanitation, explains the philosophy succinctly: water across the value chain should be funded from the sale of water. If revenues stay within the utility, it can finance maintenance, replacement, expansion and borrowing. Break that chain by spending water money elsewhere, and the system begins consuming itself.
Where theory meets reality
It is hard to argue with the logic. Prof Mike Muller, one of the country’s most respected water policy thinkers and a former director-general himself, certainly doesn’t.
“At least it’s got the problem right,” he said after the plan’s release. “We’re not short of water. We’re short of good management of the water.”
But Muller also identifies where theory collides with South African reality.
The first problem is money.
Ring-fencing works where people pay for water. Joburg, Cape Town and eThekwini can, in principle, sustain utilities from tariffs. But what about poor rural municipalities that depend largely on equitable share transfers from the national government because there simply aren’t enough paying customers?
The constitution gives those municipalities considerable discretion over how they spend those transfers. The action plan is largely silent on how the national government will ensure water receives priority. Muller believes that’s one of its biggest omissions.
Then come skills.
The government often speaks as though South Africa has run out of engineers, but Muller thinks that’s the wrong diagnosis.
The country still produces capable engineers. Too often they simply aren’t appointed, retained or given opportunities to develop inside functioning municipal utilities. Licensing providers is a good start, he argues, but licences alone won’t create competent institutions if experienced professionals continue to walk away from local government.
And, finally, there is the politics of reform.
To replace a dysfunctional municipal operating model would be to confront a hyena’s den of vested interests.
Who gives up control of procurement when the new operator steps in? Who loses tanker contracts? Who hands billing systems to another utility? Who absorbs staff, debt and pension liabilities? What happens when organised labour objects? What happens when councillors discover that ring-fencing water revenue also ring-fences political patronage?
That is why I think the National Water Action Plan is both more promising and more difficult than many commentators appreciate.
And asking South Africa’s municipalities to surrender operational control over one of their largest revenue streams may prove a far harder engineering challenge than building the next dam ever was.
