Parliament moves on bankrupt water and sanitation dept

Parliament has moved to try and rescue the financially collapsed department of water and sanitation (DWS), while numerous water utilities around the country are owed billions by the department.

Among them is Lepelle Northern Water, a state-owned water utility in Limpopo, which is owed R1.1 billion.

The utility is responsible for bulk water supply on behalf of the DWS in Limpopo and its 30 local and district municipalities. The money owed to Lepelle should have gone to fund bulk water projects in an effort to ease the escalating drought which has affected the province’s five regions since 2009.

The department failed to fund the projects because, effectively, it is bankrupt. The department’s woes followed the appointment of ANC stalwart Nomvula Mokonyane as its minister in 2014.

In April last year, the Democratic Alliance (DA) told the portfolio committee on water and sanitation led by Lulu Johnson that most of the department’s huge water projects would stall because the department owed water boards across the country.

MPs were meeting yesterday to discuss the terms of reference for a parliamentary probe into the department. The joint meeting included the portfolio committee on water and sanitation and the standing committee on public accounts (Scopa).

In February, Scopa threatened to lay criminal charges against those responsible for the financial collapse of the department.

“This department has a long history of instability and financial mismanagement, and Scopa has resolved to open a criminal case against the department because of the R2.9 billion overdraft that the department took with the Reserve Bank,” Scopa said in a statement at the time.

The parliamentary watchdog on public accounts also took aim at former water and sanitation minister Nomvula Mokonyane, who was shifted to the communications portfolio earlier in February.

“Scopa is concerned that it is ordinary people who are affected by the instability and financial mismanagement in this department, because South Africa is a water-stressed country,” it said. “In reality, minister Mokonyane has left a department that has completely collapsed.”

This week, several service providers threatened to take the Lepelle Northern Water Board and the department to court in a push to force the department to honour its payment obligations as per their service level agreements.

Lepelle Northern Water’s chief executive Pheneas Legodi confirmed the department owed them money.

He also confirmed the board also owed service providers, some of whom are threatening to take them to court.

In a presentation to the portfolio committee in March last year, Mokonyane confirmed her department had unpaid outstanding invoices amounting to R1.5 billion.

She also confirmed her department had an overdraft of R2.9 billion with the Reserve Bank.

Last week, new Minister Gugu Nkwinti admitted that the department he inherited from Mokonyane was in serious financial crisis.

Departmental spokesperson Sputnik Ratau said: “If we can collect all the money owed to us, we will then be able to get out of the woods and settle the overdraft and other debts. But we will continue to engage with National Treasury to look into the reduction and, ultimately, the eradication of the overdraft. At the moment, I can assure you that the interaction is ongoing.”

– news@citizen.co.za

Also read: Inquiry into water and sanitation moves into first gear

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