Water mafias are taking over as municipal governance collapses

It started with the construction mafia, but water seems to be the next big honey pot for organised crime.

Across the country, criminal gangs are destroying municipal infrastructure so they can sell water at extortionate rates. All it takes is an ice pick through a water mains pipe or a smashed pump, and entire communities are left with dry taps for days or weeks.

The water tank thieves are on hand to supply thirsty residents their basic needs at anything from six to 15 times the going municipal rate.

In many instances, they steal the municipal water paid for by residents and sell it back to them at huge mark-ups.

The government’s free basic water policy, allowing indigent households 6 000 litres a month without charge, is meaningless when municipal pipes run dry. Even the poor have to pay the mafias, leading to suspicions that local government workers are in cahoots with the criminals.

“There is clear evidence that the water tankered mafia has spread its tentacles across the country,” says Kasief Isaacs, head of private markets at Mergence Investment Managers.

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“Reports from KwaZulu-Natal, East London, Mpumalanga and Tshwane all speak to the same theme. Groups are willing to damage and destroy existing infrastructure so they can supply tanked water at exorbitant fees. This scourge could quickly reach the same endemic proportions as other protection rackets hurting South African business and communities if government does not decisively intervene.

“A local reticulation network typically serves anywhere between 100 to 1 000 customers. Deliberate damage or destruction of key components in the network could inconvenience the entire community for several hours to several days depending on the extent of the damage. These groups are willing to cause this level of inconvenience because the economics are very attractive.”

The typical fee for filling a 5 000 litre Jojo tank charged by the water mafias ranges from R600 to R800, estimates Isaacs.

The same water purchased from a municipality would cost R40-R120 depending on their local municipal water tariffs and total volume used for the month.

That’s huge money. A 28 000 litre tanker can generate more than R1 million in water sales in a day or two.

Municipal miasma over water systems

In 2020, residents of Kgetlengrivier in the North West were granted an order forcing the local municipality to hand over control of the area’s broken water and sewage systems to the residents association.

In just six weeks, the residents had clean water in abundance and a functioning sewage system. But that order was later reversed.

The matter is currently before the Supreme Court of Appeal, where residents argue that the local municipality has again allowed infrastructure and services to atrophy – leaving residents exactly where they started in 2020.

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They want to regain control of their water and sewage services from the municipality as the only sure way to guarantee an acceptable level of service.

Carel van Heerden, chair of Kgetlengrivier Concerned Residents, which brought the case against the local municipality, tells Moneyweb that residents have now gone three weeks without water and sewage is being pumped into the nearby Koster River. It didn’t take long for the water mafia to exploit the situation.

It’s a business model that depends on broken or destroyed infrastructure.

“I’m on a farm and have a borehole, but I worry for the residents who don’t,” says Van Heerden. “This is why we as residents have to regain control of the local water supply and sewage works.”

Widespread water management issues

The same is happening across the North West, where private water suppliers have legitimate contracts with local municipalities to provide top-up water when needed. The problem here is that municipal water supplies are deliberately throttled, allowing the water mafias to fill the deficit by supplying communities from tankers, says one whistleblower who asked not to be named.

The Kgetlengrivier court case is being keenly watched by residents associations across the country, as it could result in the widespread removal of corrupt or inept municipalities in managing water systems.

There seems little enthusiasm from police to stamp out these mushrooming water mafias, so that too may become a matter for the private sector – private security.

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The Water Services Act makes provision for placing dysfunctional water supply authorities under regulatory surveillance, but it may require a Constitutional Court challenge to prise this out of the hands of local government.

Municipalities gained control of water when the Municipal Finance Management Act was passed into law in 2003.

Under the Water Services Amendment Bill introduced last year, municipalities risk losing their Water System Provider (WSP) licences if they do not demonstrate the minimum competence and capabilities required for the job.

Meanwhile, in the Free State …

The Setsoto Local Municipality in the Free State, which includes the town of Ficksburg, previously shut off the water supply between 7pm and 7am because of what it said were critically low water levels from the nearby Caledon River and Meulspruit Dam.

This week, water was shut off entirely and thousands of residents were told to make use of 15 taps supplying borehole water in a nearby camping ground.

“Yes, we are in winter and there is a drought, but these restrictions happen every two to three months, because of a water leak or broken pump. Sometimes we have to wait days because the municipality doesn’t have spares so they have to ship stock from Joburg,” says one resident.

“Meanwhile we see tankers bringing in thousands of litres several times a day.

“We are told this is coming from farms in the area.”

KZN water mafia

Earlier this year, the Democratic Alliance visited the Ottawa Water Works in eThekwini in KwaZulu-Natal and reported that the water mafia was quickly making its way into the city, leading to critical water shortages.

“To make matters worse, it has been reported that a water mafia has set up shop in KwaZulu-Natal, allegedly sabotaging critical water infrastructure in order to extend lucrative government contracts for the provisioning of water tankers in order to profit from the ongoing crisis,” said the DA in a statement.

“In other areas, there have been reports of unmarked and privately-owned trucks selling water obtained from municipal taps to local residents at extortionate prices.”

ALSO READ: Rand Water ready to reduce supply to municipalities owing a collective R1.3 billion

This was the result of a concerted drive by criminal elements in the province to weaponise water for their own illicit gains, while the collapse of governance at eThekwini “left the door wide open for these criminal syndicates to abuse vulnerable and desperate residents”.

Destruction of water infrastructure is not a new problem. The Department of Water and Sanitation rang the alarm in 2020 on vandalism at Buffalo City in the Eastern Cape, resulting in theft of metal pipes, fittings and manhole covers, as well as water theft through illegal connections. The problem appears to have worsened since then and spread to other communities.

Nearly half the water supplied across the country earns no revenue due to leaking pipes, poorly functioning or non-existent water meters, illegal connections and billing problems. That figure is up from 37% in 2014, according to the Blue Drop Report published by the Department of Water and Sanitation in 2023.

A Coronation report entitled Tackling Water Security by Marie Antelme and Leila Joseph looked at the impact of SA’s water crisis on the JSE Top 100 companies and identified this as one of the key risks for business.

SA is a water-scarce country with about half the global average rainfall. This rainfall is highly concentrated and unevenly dispersed. The problem is aggravated by the “widespread breakdown in governance at the municipal level”, which has “exacerbated poor maintenance of water systems leading to polluted systems, poor treatment and massive physical and revenue loss [non-revenue water],” say the authors.

It’s a perfect storm of opportunity that the water mafias are only too happy to exploit.

This article was republished from Moneyweb. Read the original here.