1. Strengthening the provision of sustainable water services Towards a concept paper which: Reflects DWA and SALGA perspective Suggest some roles for sector partners 1

2. Background: DWA\SALGA meetings to discuss SALGA concerns August 2009 Bulk supplies – many muns don’t have money or skills to increase supply Institutional arrangements are deficient Municipal skills gaps Pricing across the water value chain State of wastewater treatment September 2009 Who will provide support to muns if DWAF pulls back from local government support Task: Develop a concept document to facilitate agreement on key challenges and appropriate interventions in the WS business and agree on roles and responsibilities

3. Some lessons of the past 15 years Outcomes are what matter most Importance of good leadership, the right skills, citizen engagement, effective communication, sound financial management and strong accountability systems Requirements of sustainable water services provision have been under- estimated  Water services are complex and require a more professional approach and appointment of personnel with appropriate skills  Bulk supply, bulk infrastructure, maintenance, refurbishment, emphasis on sound ‘business’ management, etc Weak financial and revenue management compounds problems with water pricing Institutional diversity: one size doesn’t fit all Institutional restructuring is complex, risky and disruptive to service delivery - wherever possible, consolidate and rebuild rather than restructure Effective service delivery requires strong IGR and the support of all spheres of government Quick fixes seldom deliver lasting benefits: need a long-term perspective

4. Competent Water Services Institutions needed Integrated nature of water services process (water resource management; environmental management; technical; financial & admin dimensions) Good management vital for national water security Reliable supplies of safe drinking water in context of deteriorating raw water quality, rising demand and growing scarcity Greater reliance on re-use and recycling

5. Responses to current challenges Re-engage citizens as active participants in effective service delivery Prominent in LGTAS Strengthen core governance and management systems in municipalities Prominent in LGTAS Strengthen financial sustainability of water services  Ring-fencing  Review pricing across the water value chain  Most water tariffs are too low – but price increases are not feasible without significant service delivery improvements  Prepare tariff-setting guidelines for municipal water services

6. Responses to challenges (2) Greater Professionalisation (key objective in LGTAS) Acknowledgement and understanding of core competencies required for effective water services provision  Fill posts with appropriate personnel  Delineate functions of politicians and officials  Make better use of skills and competencies available  Drive longer term skills development initiatives Run water services as a business  In some cases, consolidate existing capacity into a larger entity or shared services centre Lead Dept: Partners:

7. 7 Risk-based Prioritisation to inform & direct water services support interventions Risk Rating of Water Services Provision 7 Functional / coping water services At risk High risk – potential to become within 8 months Crisis. Extremely high risk of disease outbreaks Critical risk areas: Under Administration / Wastewater treatment capacity / Blue Drop and Green Drop results / Regulatory actions initiated, Lack of Technical Skills incl Process Controllers 9% of munics are in severe crisis – contamination, disease 38% most likely to reach same ‘crisis’ within 8 months A further 42% at risk to reach similar high risk profiles, if early intervention and turnaround not actioned (DWA, Oct 2009)

8. Responses to Challenges (3) Dedicated water services support facility Without effective support, the problems which result in non-compliance often cannot be fixed Support and regulation are inter-dependent, and support is the key enabler of effective regulation Additional resources needed to source hands-on specialist expertise through a “national resource pool”  Could be the specialist water services arm of the broader technical support units driven by COGTA  Business case and business plan needed Lead Dept: Partners:

9. Responding to Challenges (4) Strengthen sectoral skills development DWA-led sector skills development strategy (aligning with educational bands and taking ‘pipe line” approach i.e. ensuring skills development for the sector takes place in each educational band) Development of strategic management capacity for water services  Dedicated part-time training programme for WS managers  Hands on artisan and process controller training at dedicated municipal training facilities to support essential skills development for water service provision  Mentoring Lead Dept: Partners:

10. Responses to Challenges (5) Restructuring water services provision  No one size fits all approach – case by case assessments needed  Combining resources and skills of several munics into a large consolidated water utility or a combined services centre will enable greater scale economies than several small munic departments  Experience in setting up external stand-alone water utilities is mixed  Some form of institutional reform may be needed but wherever possible the emphasis should be on rebuild rather than restructure Lead Dept: Partners:

11. Responses to Challenges (6) Explore mechanisms to strengthen munic access to bulk supplies  Expand the footprint of water boards where financially feasible  Other mechanisms to be explored (REDS 5 + 1 approach?) in areas where it is not viable to provide wall-to-wall Water Board support (mechanism with comprehensive subsidies for areas where costs cannot be recovered from local users) Lead Dept: Partners:

12. Responses to Challenges (7) Strengthen sector monitoring and accountability mechanisms  Performance agreements in every WSA with firm, achievable targets  Strengthen resourcing and support for Regulations Performance Measurement System and other regulatory tools to drive early warning systems and response strategies  Promote local sector education initiatives to equip citizens and councilors to play a more pro-active role in strengthening service delivery  Achieve agreement on intervention protocols to enable swift responses to management and service shortcomings Lead department: Partners:

13. Response to challenges (8) Develop strategies and funding sources for informal settlements  Co-ordinated planning required as a matter of urgency  Categorise all informal settlements into 1 of 3 categories: Imminent development Urgent relocation required because of hazards No settlement upgrading or relocation imminent  Focus on the vast majority for which there are no plans Improved interim services, and / or incremental upgrading  Will require a dedicated funding mechanism as existing funding streams are inadequate Lead Dept: Partners:

14. Response to challenges (9) Strengthen IGR  Growing recognition that responsibility for municipal services does not lie with local govt alone  Integrated approach across three spheres of govt with clearly defined roles and responsibilities  Building on the LGTAS and Presidency’s proposals (policy paper M&E), build consensus on Roles and responsibilities Co-ordination and communication mechanisms Mutual accountability mechanisms  Identify and address constraints to ensure any agreement is workable (funding, powers and functions, etc)  Clarify where responsibility for Sanitation lies

15. Way Forward 1.Are these the main issues? Do we agree with these responses? Any major gaps? 2.Looking at the responses - How do we ensure sector responds effectively?  What is in place?  Who leads / drives? Who are the key partners?  What funding exists or is needed? 3.How to position the sector? How to engage in the process and ensure readiness of sector?