Treasury review key to Siza Water concession extension

National Treasury’s current review of the Municipal Public Private Partnership (PPP) regulations will largely determine whether Siza Water’s concession is extended beyond 2029.

The 30-year concession contract was awarded to the local water provider in 1999 for the area covering 12,5km² and includes Ballito, Shaka’s Head, Shakaskraal, Tinley Manor, Shayamoya and Etete.

Considering the professional service level the concession area’s residents enjoy compared to other service providers, as well as the Department of Water and Sanitation’s (DWS) recently announced intention to involve business and private sectors to meet the country’s water needs, an extension seems logical.

The final decision, however, lies with the iLembe District Municipality (IDM), who has to date reaped lucrative rewards from the concession.

Besides reducing an inherited bulk water loss of more than 50% within the concession area to an average of less than 13% for the last 15 years, Siza Water has also paid the iLembe district in excess of R75-million in profit share over the last two years. This is in addition to the initial lease rentals.

Marking a quarter century of redefining what is possible, Siza Water hosted a glamorous all-black gala birthday at the Capital, Zimbali last Friday.

Keynote speaker, Human Settlements, Water and Sanitation deputy minister David Mahlobo, said children within the concession area who were previously denied access to education due to having to travel long distances to fetch water, were now skilled and gainfully employed and contributing to the economy because of Siza Water’s efficient, safe and reliable service delivery.

Mahlobo said in other areas infrastructure had collapsed due to aging infrastructure and leadership failing to take action. He challenged IDM to invest some of the R75-million back into the district’s water infrastructure.

Asked about the prospect of a possible contract extension, Siza Water managing director Shyam Misra said: “We need to align the contract with the current PPP regulation and as we heard from the deputy minister, the regulation is under review. We must follow what is correct within the law. From our side as Siza Water we would love to see the contract extended but we must do what is right in terms of processes and good governance.”

Achievements

To date, Siza Water has never been issued with any directive of non-compliance in terms of their contractual mandate.

Misra said this was achieved through focusing on the company’s core values, including people, innovation and product.

“From a company initially having its strategic senior management as European expatriates, through our aggressive empowerment and skills transfer initiatives today we have a proudly South African management team, the majority of whom are from historically disadvantaged communities. This was achieved without compromising service,” said Misra.

He said there were many examples of Siza Water staff who could not read or write who have been put through programmes to finish their ABEIT classes and go on to become qualified artisans.
Paying special attention to women empowerment, the company also today has many skilled female artisans, chartered accountants and geographical information systems administrators who are equal to their male peers.

“Our proudest achievement is the Siza Water Bursary Fund that has produced 30 [tertiary] graduates from disadvantaged communities in less than 10 years.”

When it comes to innovation, perhaps the most impactful achievement was the direct water reuse plant that was designed, constructed and operated by Siza Water during one of the worst droughts in 2015.

The plant still operates today and was also a lifeline during the 2022 floods when there was extensive damage to infrastructure and limited potable bulk water supply.

Embracing the digital age, Siza Water uses integrated software that correlates their bulk zone meters to individual customer consumption.

The company has also recently selectively implemented live in-line monitoring of pressures and flows to the water network.

While recent DWS blue and green drop audits paint a gloomy picture of the water industry, Siza Water achieved the only two Green Drop audits for waste water quality and delivered the only drinking water quality Blue Drop audit in the iLembe district in late 2023.

The Blue Drop audit placed them as the third best service provider in the country.

This followed the 2014 Blue Drop results in which Siza Water was placed as the best water service provider in South Africa – a position they are striving to reclaim.

“Not many service providers can boast being simultaneously Blue and Green Drop accredited,” said Misra.

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