Hon Speaker, hon Ministers, hon Deputy Ministers, hon members, distinguished guests, and ladies and gentlemen, I rise on behalf of the Portfolio Committee on Water and Environmental Affairs on this occasion to recommend to the House the passing of an international agreement in terms of section 231(2) of the Constitution of 1996. This is the Lesotho Highlands Water Project Phase II Agreement, which the governments of the Republic of South Africa and the Kingdom of Lesotho signed in November 2011 and which the committee unanimously agreed to support. We also recommend the adoption of the committee's report on its oversight visit to the Lesotho Highlands Water Project during the October 2012 recess, which the committee also unanimously adopted.
The committee has done so for the following reasons. South Africa is an arid country with periodic droughts and a very unevenly distributed rainfall. Moreover, the availability of water is very unequal, with a considerable part of the population still without access to safe drinking water and adequate sanitation.
The chronic shortage of water, particularly in the Gauteng area, with its large and intense industrial activity and its two metropolitan cities, already posed a major security challenge as far back as the mid-1950s, considering the fact that the densely populated Gauteng region is one of those very few industrial areas in the world not established along any natural body of water.
An active and urgent search for additional water resources therefore became primarily important with interbasin water transfers being identified as the most cost-effective solution, leading to the evolution of the comprehensive Lesotho Highlands Water Project.
It suffices to state that this project was conceptualised in the 1950s but it was only in October 1986 that the treaty was signed by South Africa's apartheid government and the Lesotho military regime, which formally established the Lesotho Highlands Water Project after the completion of a feasibility study. Thus, the Lesotho Highlands Water Project was established as a binational project spanning the borders of South Africa and Lesotho in accordance with that treaty.
This miraculous engineering feat diverts water from the Senqu River system in Lesotho to South Africa's economic hub, the water-stressed Gauteng province. The project is one of the largest and most intricate engineering construction projects in Africa. The total project was originally envisaged to transfer 70 cubic meter of water per second from the upper portions of the Lesotho Highlands to the Vaal River basin. The scheme was designed in phases, four to be precise, with each phase providing additional transfer capacity until we reached the 70 cubic meter level.
The water that is routed to South Africa through the mountains and the tunnel is put to good use also by empowering the Muela power station that generates electricity to meet the energy needs of the Lesotho people.
The first phase of the project saw the building of two dams, namely, the Katse Dam and Mohale Dam, an intake tower, transfer tunnels, a delivery tunnel and hydropower station at Muela, and a network of roads around and between this water infrastructure. Lesotho depended entirely on South Africa for its electricity requirements prior to this project.
The project has had an important impact on Lesotho's infrastructure, as hundreds of kilometres of engineered paved roads have been built in order to improve access to the different construction sites, as well as feeder roads. Today they still form a very important communication network for the villages of Lesotho.
Thus, the Kingdom of Lesotho has benefited from infrastructure development projects like dams, roads and hydropower, recruitment opportunities, and sustainable royalties of about R450 million per annum in the first phase of the project. This corresponds to 4% of Lesotho's gross domestic product, GDP, and 10% of total government revenues.
I hear I don't have the time I thought I had. So, I'll skip a few pages and go to the second phase. The second phase is now coming into operation with the signing of the agreement by the two respective governments in November 2011. The purpose of the agreement is to improve the use of the water of the Senqu/Orange River system by storing, regulating, diverting and controlling the flow of the shared water, in order to deliver specified quantities of water to South Africa.
The Phase II project entails the construction of a third dam, the Polihali Dam on the Senqu River, a transfer tunnel from Polihali to the Katse Dam and expansions to the existing Muela hydropower complex. Thus, the Kingdom of Lesotho will benefit further from all the factors that I have mentioned before, and, of course, additional royalties in regard to the water that they will produce.
It is against this background that the committee decided to visit and assess the achievements of Phase I of the project, as well as scrutinise the plans for the operationalisation of Phase II, considering the significant financial resources we have put into the project.
Accordingly, the members of the committee and staff went on an oversight visit to the project from 1 to 3 October 2012. Our observations and recommendations are contained in the committee's oversight report which was unanimously adopted and tabled in the ATCs and is recommended for adoption by the House. Let me finally say that we therefore recommend that both these reports be adopted by the House. Thank you very much. [Applause.]
There was no debate.
Question put: That the Agreement between the Government of the Republic of South Africa and the Government of the Kingdom of Lesotho on Phase II of the Lesotho Highlands Water Project be approved.
Declarations of vote:
Chairperson and hon members, having now personally seen the site of the proposed Polihali Dam, it gives me great pleasure on behalf of the DA to support the agreement on Phase II of the Lesotho Highlands Water Project between the government of the Kingdom of Lesotho and the government of the Republic of South Africa.
The previous agreement was signed in 1986 and led to the building of the Phase I infrastructure, including the awe-inspiring Katse and Mohale Dams. Phase I is delivering water to the thirsty province of Gauteng, but water planners are well aware that the Vaal system requires more water. It will in the next few years be in deficit. Phase II, which is before this House today, will include the construction of the Polihali Dam and a 38 km tunnel linking the Polihali Dam to the Katse Dam. The project is expected to further augment the water supplies to Gauteng by 2020.
As of December 2010, the project was expected to cost US$8 billion. This is an off-budget project, which means it will be funded by loan capital. Projects of this size require the strongest possible oversight. Phase I of the Lesotho Highlands Water Project was tainted with corruption, and several individuals involved have served or are currently serving jail sentences. The agreement for Phase II includes strong anticorruption clauses and is backed up by a policy as prescribed by the agreement. The whole project will also be scrutinised by foreign external auditors during the course of the life of the project.
The DA recognises the importance of the provision of water to sustain human health and support economic growth. South Africa is a water scarce country, yet too many South Africans take water for granted. Insufficient water can negatively affect irrigation, thus reducing food security, and it can negatively affect mining, thus reducing foreign exchange and job creation. South Africans so often fixate on the lack of a reliable supply of electricity as a barrier to economic growth. The same can be said for water though, and the consequences of a lack of water are far more devastating than a lack of power.
Phase II will offer increased water security, but let us be mindful that the water it will provide is not a licence for business, agriculture or municipal users to waste water. The obligation is on all water users to use water efficiently and to return water to the water courses in an acceptable state after it has been used. What we do not want to be doing in 2020 is chasing the good, clean water from the Polihali Dam after the discharged polluted water from Gauteng water users in order to dilute the latter. Thank you. [Applause.]
Hon Chair, Cope has learnt that the idea of transferring water from the Kingdom of Lesotho to South Africa originated in 1920. The distinct possibility of putting this idea into action was raised again in 1950 by a Cape Town-based engineer, Ninham Shand, with sceptics not giving it a chance of ever coming to fruition.
However, it was formalised in 1986 with the signing of the co-operation treaty between the two countries. This treaty covered all aspects of design, construction, operation and maintenance, and institutions of government and governance. Little did the sceptics know that by the end of 2008 the Lesotho Highlands Water Project would reach its biggest milestone. The entire project is expected to cost about US$8 billion on its completion in 2020. It is set to claim its rightful place as a blueprint for Africa's future water resources, development and management initiatives.
Who would have guessed at that time that this would become a truly African success story? In November 2003 the SA Institution of Civil Engineering named the Lesotho Highlands Water Project "The Project of the Century". This is a sign of true African co-operation long before "Chinese" became an investor buzz word.
This water is meant to address the needs of South Africa's rapidly expanding Gauteng province, which generates almost 60% of the country's industrial output and 80% of its mining output, and where over 40% of South Africa's population live. This province needs more water. The Lesotho government received royalties for the water sent to South Africa of about $31 million in 2004. This is about 5% of its GDP, which has grown to over R450 million year on year. This project will create 3 500 new jobs for the Basotho people. Before the project, Lesotho depended entirely on South Africa for its electricity requirements. Now her hydroelectricity is almost 100% homegrown, thanks to this initiative.
However, this glorious story gets drowned in the water - if you will excuse the pun - of the unfortunate events of corruption and fraud that occurred soon after the inception of Phase I. Thanks to the resolute democratic government that came to power in Lesotho in 1993, that corruption was quickly rooted out, just as it reared its ugly head.
It is Cope's desire that similar resoluteness should be shown here against party deployees who glean government resources with impunity. It is hoped that the likelihood of corruption taking place in the second phase of the project will be nonexistent, in the light of the Phase I examples. The Department of Water and Environmental Affairs has confirmed that an anticorruption policy between South Africa and the Kingdom of Lesotho has been put firmly in place.
Cope supports this exciting project. I thank you.
Agreement between the Government of the Republic of South Africa and the Government of the Kingdom of Lesotho on Phase II of the Lesotho Highlands Water Project approved.