Municipal Water Infrastructure Grant (MWIG) Presentation to the Standing Committee on Appropriations 05 MARCH 2013

CONTEXT (ROLE DEFINITION) LG 156. Powers and functions of municipalities. (1) A municipality has executive authority in respect of, and has the right to administer- (a) the local government matters listed in Part B of Schedule 4 and Part B of the Constitutions Water and sanitation services limited to potable water supply systems and domestic waste-water and sewage disposal Policy Development Set norms and standards Support to local government etc. National

Our Understanding of the Grant Conceptualisation Process Minister of Water and Environmental Affairs had a meeting with 23 District Mayors on the 13 August 2012 Mayors present supported in principle the challenges faced by their DMs Mayors were requested to cooperate with this process i.e. a need for such an intervention Consultation were undertaken with the technical Directors of DMs to scope the challenges and develop action plans The above process resulted in the conceptualisation of the grant.

Our Comments on the grant establishment SALGAs comments to the budget forum on the grant included amongst others: The country previously had a proliferation of grants that were administered by various national and provincial departments. The lessons learned from that experience was that it becomes very difficult to facilitate integrated infrastructure development under such circumstances. This led to the consolidation of grants to MIG and later USDG in the case of Cities. This appears to be reversal of that progressive trend.

Our Comments on the grant establishment Local priorities get overridden by national prioritisation. Municipalities will again be placed in a situation where communities may be saying that their number one priority is a road but the municipality would saying that such a community will in fact get water supply because available funding for capital expenditure is conditional on it being spent on water supply. Conclusion was: SALGA did not support the creation of the grant

COMPARING MIG AND MWIG ITEMS MIG MWIG Strategic Goal Subside the capital costs of providing basic services to poor households – priority must be given to meeting basic infrastructure needs to the poor through the provision of appropriate municipal bulk, connector and internal infrastructure for key services To assist Water Services Authorities to provide water supply to consumers currently without services, particularly in rural areas Grant purpose To provide capital finance for basic municipal infrastructure backlogs for poor households, micro enterprises and social institutions servicing the poor communities To facilitate the planning, acceleration and implementation of various projects that will ensure water supply to communities identified as not receiving a basic water supply service Outputs Number of additional poor households receiving basic water and sanitation services Number of work created opportunities created using EPWP guidelines Number of households provided with water supply Number of rural schemes that are functional in line with norms and standards Number of job opportunities Due to the similarities of the two grants it might be difficult the measure the policy outcomes as a result of the new grant

FUNDS TOP SLICED FROM MIG YEAR MIG TOP SLICE MWIG 2013/2014 R291M R312 2014/2015 R946M R113 2015/2016 R1 273M R1399 TOTAL R2 510 R1 824 (additions from baseline) Most of the funds comes from MIG

Some challenges No clear coherent policy imperatives that underpins the creation of MWIG and related grants (e.g. RHIP) Grant establishment not underpinned by spare capacity in the water sector to accelerate delivery - service providers will be used and not necessarily government skills Administrative burden of complying with MWIG processes as contained in the DoRA framework Grant limited to DMs only – provinces and municipal areas where LMs are WSAs will not benefit e.g. WC, MPU, Limited alignment with sanitation services – coordination Limited new funds The urgent funding needs at municipal level relates to refurbishment and replacement of ageing infrastructure

Recommendations The devil is in the detail of this new grant – DWA, SALGA and municipalities work together to define a common goal in the implementation of the grant DWA, DCOG, NT and SALGA explore the possibility of developing a coherent policy response to the infrastructure challenges faced by municipalities

Thank you

Some challenges 5 key pillars underpinning the delivery of water services - Replacement, Refurbishment, and WCDM, Operations and Maintenance Skills – capacity building State of municipal infrastructure According to the report card the water infrastructure received a D- for rural, C+ for urban. These grading implies that rural water infrastructure operated by municipalities requires major attention in as far as water wastages, shortage of skills etc. For the urban context it seems the current situation is manageable, however measures must be placed in water quality and not quantity Need a policy intervention – on municipal infrastructure