Hon Deputy Chairperson, hon Minister and Deputy Minister of Water and Environmental Affairs, and hon members, water is a catalyst for growth and development, and should be used to achieve the economic growth and job creation objectives of our country. In this context, we would like to focus on three areas, which are water pricing, water losses and infrastructure investment.
On water pricing, a trends analysis is beginning to suggest that South Africa is moving towards pricing water at a level that will begin to work against our country's economic competitiveness. This is driven by a policy framework that requires the water industry to be financially self- sustainable and, therefore, recover all its capital and operating costs from user charges. This is the policy framework that drives water pricing by water boards and is pushed to drive water pricing by municipalities. The high bulk water price increases in the past two years are a direct result of both a lack of economic regulation in the sector and the water pricing policy framework. The unfortunate consequence is that more and more middle and high-income households and SMMEs, that is small, medium and micro enterprises, are beginning to default on payment. This then leads to an inability by municipalities to pay water boards for bulk water.
We understand that the establishment of the economic regulator is under way. However, we would like to suggest that the Minister initiate a process of reviewing the water pricing policy, especially the ideology behind it.
With regard to water losses, water losses in the country's distribution infrastructure and homes of low-income households that cannot afford to pay high water bills have reached unmanageable levels. We are losing between 20% and 40% of water delivered by our bulk infrastructure. A significant part of the problem is that many water and waste water treatment schemes inherited by municipalities from pre-1994 authorities were without documents, such as updated drawing designs.
Consequently, in some of the inherited municipalities, it is not known where infrastructure, such as pipes, is laid, or the age of the materials used. The increasing use and pressure on these pipes lead to regular pipe bursts and leaks. We need a major, countrywide intervention of the magnitude of the Working for Water programme to address this. The purpose of such an intervention would be to locate the pipelines, assess their condition and implement a refurbishment or replacement programme. Local government calls upon the national government, through the Department of Water and Environmental Affairs, to partner with it in this proposed initiative.
The proposed programme can be an Expanded Public Works Programme in terms of which unemployed young matriculants will be trained and utilised. It could be a pioneering initiative towards locating and registering the state of all Public Service infrastructure, such as roads, water and waste water treatment plants, electricity infrastructure, clinics, schools, etc.
This will assist in informing infrastructure maintenance and refurbishment programme plans. In this way, we could create jobs and reduce the wastage of increasingly scarce and expensively treated water, while at the same time improving the efficiency with which we utilise our natural resources.
In terms of infrastructure investment, the SA Local Government Association, Salga, notes with appreciation the number of mega water projects that will ensure supply, quality and quantity. Bulk water supply has become one of the major constraints to socioeconomic development in many municipal areas.
We, however, remain concerned that water supply assurances in areas that are not suitable for mega projects remain a binding constraint on socioeconomic development. There is a need for both sustainable funding and institutional arrangements to achieve this. The long-awaited institutional reform for bulk water services provision is now long overdue and we would like to request our Minister to push her department to complete this work.
On the environment, Salga would like to comment in respect of the government's response to acid mine drainage and funding of environmental functions at the municipal level. The rapid rise in the levels of acid mine water poses a serious threat to both the environment and infrastructure. In areas of Gauteng such as Johannesburg and Ekurhuleni, the issue of acid mine water is approaching crisis proportions. Municipalities are very concerned about the clarity and speed of implementation of response measures.
Salga wishes to request the Minister, in her response to this debate, to outline clear response measures, with timelines, indicating the extent to which these implementation timelines with regard to the response measures will avert the crisis.
The Constitution lists the environment as a concurrent function of provincial and national government. In addition to one of the objectives of local government, as stipulated in the Constitution, which is to promote a safe and healthy environment, the following municipal functions, as assigned to local government by the Constitution, can be considered essentially environmental functions: refuse removal, refuse dumps and solid waste disposal, also known as waste management services; air pollution; pontoons, ferries, jetties, piers and harbours; cleansing; and municipal parks and recreation.
In urban areas, with the exception of refuse removal, refuse dumps and solid waste disposal, which are funded from user charges, all these functions are meant to be funded from rates income as part of the basket of 34 municipal functions that should be funded from the same rates income.
In rural areas, none of these services are funded as there are no user charges or rates levied in these areas. The national government has since passed a policy that requires waste management services to be provided in all parts of municipal areas, including our rural areas.
There is a need to develop a sustainable funding model and policy for these environmental functions. As Salga we request the Minister to add this to her list of activities for this financial year. We thank you, Deputy Chair. [Applause.]