Chairperson, with regard to the first part of the question, the money owed by municipalities to water boards as at 31 July 2009 is as follows: the current debt is R630 290 676 million and the arrears are R525 632 866 million. This means that the outstanding balance is R1 155 923 542 billion.
Secondly, the department facilitates meetings between water boards and the National Treasury. The latter has the mandate to mediate between water boards and relevant municipalities for payment in terms of section 44 of the Municipal Finance Management Act of 2003.
The department, with the Department of Co-operative Governance and Traditional Affairs, the National Treasury and Salga, formed a task team last year, 2008, which visited all regions to engage water boards and municipalities on bulk water agreements and non-payment issues. The outcome varied from region to region. In some regions, water boards and municipalities were talking to each other for the first time, which resulted in more regular payments to water boards.
There were also three disputes. The first was between the Umgeni Water and Msunduzi Municipality. One of the recommendations made on this dispute was that Umgeni must pay back the profit that was generated from the management of Darvill works.
The second dispute was between Bloem Waters and Ukhahlamba District Municipality. It was also based on non-payment of invoices for operation and maintenance services, including outstanding project claims.
The last dispute was between Tshwane Municipality and Moretele Municipality. The dispute involved R38 million which was owed by Moretele Municipality to Tshwane Municipality. Tshwane Municipality ultimately agreed to cancel all the interest charged from the total debt, and Moretele Municipality committed to pay R8 million per month to settle the debt.
No impact is envisaged on the capital expansion plans of any water board. Capital projects are financed by a combination of loan funding and internal cash resources, which are accumulated over the years due to operating surpluses and in most cases from underexpenditure on capital projects.
At the end of June 2008, water boards had accumulated approximately R1,9 billion in their cash reserves. In the light of the strong balance sheets, the tariff proposed by the former Minister had no real negative impact on water boards' ability to spend and borrow for capital development.