When we achieved democracy in South Africa, the government recognised that without effective revenue collection and allocation, the country’s aspirations as a developmental state would be severely constrained. So they went to work to ensure there was an efficient tax collection system. The availability of money is obviously critical to feed a well-functioning economy but I would argue that the availability of water is as important. Without reliable access to water we and our economy will falter. The Institute of Risk Management South Africa has recently rated water supply as our second biggest risk, behind corruption but ahead of an economic down-turn and unemployment.
In the same way as the South African Revenue Service ensures a flow of revenue, so must we ensure a flow of water. While we citizens can do our bit to contribute, we don’t build dams, transfer systems, water purification works, waste-water treatment works and various freshwater, sewage and stormwater reticulation systems, and we don’t collect revenue. We pay our taxes and we pay for our water so government can do these jobs.
But it is well known that our water system is in intensive care, not far from death’s door. The Department of Water and Sanitation is buckling and bankrupt; some water utilities cannot deliver services and many of our municipalities are our biggest wasters and polluters. It is not only in Pietermaritzburg that our rivers and streams serve as open sewers; it is everywhere. This is not something new; the decline has been evident for at least fifteen years.
What should we be doing to turn things around, to ensure that water is a foundation for a vibrant economy rather than a growing risk to a faltering economy? The foundation for a turnaround requires four things: an appreciation and acknowledgement on the part of everyone that a crisis exists; a recognition that we cannot solve the problems alone; a commitment to act, not just talk; and a fundamental appreciation of the value of water. To quote the Department: there is a ‘lack of understanding of the strategic value of water (and the) importance of water security.’
Leading on from this, in appreciating its value, we need to get the prices right. It is complete madness that raw water from a river costs 1.64 cents per cubic metre – that is 0.00164 cents a litre! At that price we won’t cover the cost of collecting the revenue, let alone secure a reasonable return for investment in catchment protection and management.
But getting the pricing right is irrelevant if we don’t collect the revenue from sales. Most of our municipalities are unable to collect what is due to them, so they don’t have the income to invest in infrastructure development and maintenance, and in conservation measures. Thirty percent of South Africa’s population can afford to pay for water but for various reasons do not. If they did it would provide an additional R 26 billion annually to re-invest.
Once we have a revenue stream, we can get busy fixing the leaks in both our freshwater and sewer systems. And when the leaks are fixed we will have to buy less water so our financial standing will improve further. If Cape Town can reduce its non-revenue water to 15% so can Durban (currently at 37%) and Pietermaritzburg (currently at around 40%).
And when the municipalities have fixed their leaks we will need to invest less in new costly infrastructure and can invest more in maintaining our natural systems that ensure reliable supply. We will get out of our current downward spiral and into an upward trajectory of collective prosperity. It is possible and it is absolutely essential.
Duncan Hay is the Executive Director of the Institute of Natural Resources and an Associate Research Fellow at UKZN. This is an edited version of an article that first appeared in The Witness on 16 July 2018.