1. RAND WATER PRESENTATION TO PORTFOLIO COMMITTEE

2. BACKLOGS IN OUR SERVICE AREA WATER BACKLOG: 10,9% of people – 332,000 householdsWATER BACKLOG: 10,9% of people – 332,000 households SANITATION BACKLOG: 19,1% - 581,000 householdsSANITATION BACKLOG: 19,1% - 581,000 households BUCKET SANITATION: Intabazwe – 400 households using buckets can be eradicated – capital needed is R700,000BUCKET SANITATION: Intabazwe – 400 households using buckets can be eradicated – capital needed is R700,000 BUCKET SANITATION: Bekkersdal – 15,000 householdsBUCKET SANITATION: Bekkersdal – 15,000 households

3. SUBSIDY RECEIVED FROM DWAF Odi Retail The total subsidy received for Odi Retail is approximately R14millionThe total subsidy received for Odi Retail is approximately R14million This is split between Tshwane (R12.5million) & Madibeng(R1.5million)This is split between Tshwane (R12.5million) & Madibeng(R1.5million) Tshwane receives the larger share based on the number of consumers in its areaTshwane receives the larger share based on the number of consumers in its area

4. ODI KEY ISSUES Ensuring high standard of water quality. Cost recovery (keeping control of bad debts). Very high level of service for a low income area exacerbates this problem. Reducing unaccounted for water given the poor quality of infrastructure. R40m subsidy from Tshwane plus R14m from DWAF could be halved if very stringent credit control methods were applied.

5. IMPLEMENTING AGENT Western Highveld Region: Cullinan & KungwiniWestern Highveld Region: Cullinan & Kungwini Cooperation between water boards and municipalitiesCooperation between water boards and municipalities R74m approved from DWAFR74m approved from DWAF R35m still to be provided from DWAFR35m still to be provided from DWAF

6. COMMUNITY DEVELOPMENT INITIATIVES Since 1994 Rand Water has: Established community development support units (CBPD & Rand Water Foundation) Implementing Agent for (inter alia) DWAF – Work on cost recovery basis only

7. FOCUS AREAS Focused on the following programme/projects: Focused on the following programme/projects: Water supply provision (construction bulk and reticulation pipeline)Water supply provision (construction bulk and reticulation pipeline) Sanitation services (Health & Hygiene awareness creation ands construction of sanitation facilities)Sanitation services (Health & Hygiene awareness creation ands construction of sanitation facilities) Water ConservationWater Conservation

8. FOCUS AREAS Alien plants eradication (water conservation)Alien plants eradication (water conservation) Domestic Leaks repairs (reduction of water wastage through repairs of domestic leaking pipes, taps, and retrofitting of cisterns)Domestic Leaks repairs (reduction of water wastage through repairs of domestic leaking pipes, taps, and retrofitting of cisterns)

9. PROJECT IMPLEMENTATION FROM 1994 TO 2004 SectorObjectivesFunder Job Creation Project Value Househol ds Serviced Winterveldt Water Provision of water supply to RDP standard DWAF 3 120 81 000 000 25 000 Winterveldt reservoir construction Construction of bulk water infrastructure to augment water supply DWAF Sub- contract 4 500 000 25 000 Wintervedlt Sanitation Promotion of health and hygienic & provision of sanitation facilities DWAF/C TMM 84 5 500 000 15 000

10. PROJECT IMPLEMENTATION FROM 1994 TO 2004 SectorObjectivesFunder Job Creation Project Value Households Serviced Bushbuckridge Water Infrastructure Construction of water infrastructure (reservoir, purification plant, bulk pipeline) DWAF450 24 000 000 18 000 Alien Plant eradication (Mogale City & Elandsfontein) Water conservation DACEL1700 14 900 000 8 000 8 000 Alien Plants eradication Water conservation DEAT270 6 000 000 6 000 000 6 500 6 500 Bekkersdal Bucket Eradication Promotion of health & hygiene awareness DWAF28 3 000 000 3 000 000 15 000

11. PROJECT IMPLEMENTATION FROM 1994 TO 2004 Budget this fiscal year Total Budget amounts to R22,1 million RW Implementing Fees amounts to 10% of project value How much costs of implementing agency have we saved the project by being a cost recovery structure Project Value RW IA Costs RW % Cost Market Cost Market % Cost RW Project Saving R22,100,000R2.2m10%R4.4m20%R2.2m

12. CHALLENGES Increasing access to Water and Sanitation Services Ensuring affordable and sustainable services

13. SALES 2002/3 (LAST YEAR) TotalR2,8 bn MunicipalitiesR2,42 bn MinesR239 m DirectR54 m Raw WaterR64 m

14. 80,000,000 85,000,000 90,000,000 95,000,000 100,000,000 105,000,000 1997 / 98 1998 / 99 1999 / 00 2000 / 01 2001 / 02 2002 / 03 FINANCIAL YEAR AVERAGE MONTHLY SALES (kl/month) 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% PERCENTAGE GROWTH AVERAGE MONTHLY SALES % GROWTH YEAR-ON-YEAR SALES TREND

15. REVENUE VS RAW WATER - INCREASES IN UNIT COSTS

16. RAND WATER GROSS MARGIN (%)

17. 0 50000 100000 150000 200000 250000 300000 1999 Actual 2000 Actual 2001 Actual 2002 Actual 2003 Actual R'000 0 2 4 6 8 10 12 Percentage Profit for the year Profit margin (%) RAND WATER PROFITABILITY

18. ECONOMIC VALUE ADDED R’000

19. TOTAL COSTS AS A PERCENTAGE OF REVENUE

20. SOCIAL RESPONSIBILITY cont.. Jobs created 435 jobs Total spent on wages on local communities 38% of budget 38% of budget R4,4 million Community and schools water education programmes R 4 million Spent on HIV/Aids R 2 million Expenditure on local community suppliers 23% of the budget 23% of the budget R2,7 million

21. IMPORTANT ISSUES GOING FORWARD Conclude the amendments to the Water Services Act (1997)Conclude the amendments to the Water Services Act (1997) Do Water Utilities have a role to play in NEPAD?Do Water Utilities have a role to play in NEPAD? Water service provision is premised on water resource management – Guiding the reform processWater service provision is premised on water resource management – Guiding the reform process Set clear guidelines and criteria for the sector reform processSet clear guidelines and criteria for the sector reform process

22. IMPORTANT ISSUES …..Cont Leverage the capacity in water utilitiesLeverage the capacity in water utilities Encourage partnerships rather than boundariesEncourage partnerships rather than boundaries Challenge service providers to co-create the futureChallenge service providers to co-create the future