STANDING COMMITTEE ON APROPRIATIONS

PROGRESS ON MUNICIPAL WATER INFRASTRCTURE GRANT (MWIG)

Presented by:

Ms L Mokoena

Date: 13 September 2013

Contents

1. Background and Overview2. Progress – National Programme Management 3. Progress – Provincial Programme Management4. List of projects , analysis and examples5. Challenges 6. Conclusion

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1:Background and Overviewa. Interim/Intermediate Water Supply Programme (IIWSP) was

initiated in 2012 by the Minister as a recognition of the plight of many people without services, particularly in rural areas.

b. The programme will initially focus on the 24 DM with the highest backlogs and therefore merge with the existing initiative to address the 2014 water backlogs.

c. The programme is initiated by the DWA as part of its leadership role in the water sector.

d. The programme will facilitate solutions and where possible, provide direct support and funding in areas that are not covered by existing projects.

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Aim / Purpose

The purpose of this programme is not to duplicate other existing programmes or initiatives, but to supplement them where there are gaps and to also provide some short –term and quick win solutions.

The programme also envisages addressing functionality related problems and not only addressing new infrastructure requirements.

The programme is part of the new paradigm promoted by the DWA: “Source to tap – tap to source”

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Alignment and Integration of programmes /GrantsTIME (project duration)

FUNCTION

SIZ

E-B

UD

GE

T

Quick fix Technical solutions

Asset Management,

WC/WDMRETICULATION BULK

REGIUONAL BULK

WATER RESOURCE

RRU /MISA

RBIG

ACIP

NATIONAL TRANSFER

MIG

MWIG

NWR:infrastructure

MWIG is only for water backlog area and for WSA in the 23 priority DMs. ACIP can be used for Hot-Spots , WWTW and for all WSA

small water resource schemes can be developed through MWIG and

Limited to selected WSA that were partof previous homelands

Goals / ScopeGoals:

1.All communities living in settlements greater than 50 households must receive a minimum interim water supply before 30 June 2015, either through a permanent water supply scheme or an interim or intermediate water supply intervention.

2.In addition to the Interim, Intermediate, Intermediate Water supply interventions, facilitate a solution to the “hot-spot” areas related to water service delivery challenges in the 24 priority DMs before 30 June 2015.

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Implementation Strategy

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Implementation framework 2013/14

101-Jun-13

201-Jul-13

3exit 1: Feasibility not approved

15-Jul-13

4exit 2: BP not approved

19-Jul-13

531-Jul-13

601-Sep-132013/2014 budget allocations

adjustments

assessment of feasibility studies

Assessment of Business Plans

Signing of agreements

Project Implementation Plans /Project

registration2013/2014 budget payment

schedules submited

Development and submission of B/P

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Implementation framework for 2014/15 projects Due date 2nd Due

date

701-Jul-13

823-Sep-13 24-Mar-14

930-Sep-13

10exit 1: Feasibility not approved

15-Oct-13 14-Apr-14

1121-Apr-14

12exit 2: BP not approved

31-Oct-13 01-May-14

1315-Nov-13 15-May-14

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Assessment of Business Plans

Approval of B/P and Signing of agreements

2013/2014 budget allocations adjustments

Development and submission of B/P

assessment of feasibility studies

Revise and re-submit B/P

2014/2015 financial year

Project Implementation Plans /Project

registrationProposal for Feasibility study /technical report

Development of feasibility study

keyred arow refers to process relating to 2nd due date for projects requiring studiesDue dates specified in DoRA

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2: Progress – National Programme Managementa. Various templates compiled (Business Plans, reporting templates,

standard agreements)b. Implementation framework document developedc. DoRA requirements met (submission of payment schedule)d. Additional capacity established (MWIG manager in each region

appointed and MWIG manager in HO)e. Reporting to National Treasury f. Support of Regional offices with processes.g. Consultation with stakeholders (additional consultation):

– 30 Aug, Backlog working committee Collaboration meeting /workshop– 3 Sep; MIG quarterly workshop– Aug, seven Provincial workshops with municipalities, Water Boards and other

key stakeholders10

Governance, tools and guidelines

a. MWIG Framework finalised setting out: Responsibilities; Process for approval; Purpose; Outcome and Outputs; Conditions;

b. Comprehensive IIWSP strategy / implementation plan developed. c. Various guidelines developedd. Term contracts for the procurement of bore-holes and planning

PSP developed.e. Business Plan templates developed.f. Terms of reference for provincial co-ordination planning

committees developedg. Standard Funding agreements developed

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Payment schedules 1. Payment schedules had to be submitted before the project B/P

were finalised.2. Summary of Payment schedules are as follows

  R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000

Date EC FS KZ LP MP NC NWTotal per province

TOTAL AUGUST 14 552 5 240 43 974 10 147 17 892 9 929 4 870 106 604

TOTAL OCTOBER 45 220 10 398 143 859 22 322 44 735 6 442 11 874 284 850

TOTAL JANUARY 27 006 5 157 79 630 61 004 26 841 - 11 873 211 511

GRAND TOTAL 86 778 20 795 267 463 93 473 89 468 16 371 28 617 602 965

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3: Progress – Provincial Programme Managementa. 95% of all required agreements between DWA and municipalities

signedb. 100% of all business plans for 2013/14 submitted.c. 95% of all business plans for 2013/14 approved.d. 1st Payment schedule releasede. A number of municipalities have agreed to the use of Water

Boards as implementing agents:a. All projects in the Free Stateb. Nzo District Municipality in the Eastern Capec. Bushbuckridge in Mpumalanga

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Payment schedules Progress1.1st Transfer completed2.A error occurred in KZN where some of the allocations where to LM and not to the DM.3.After consultation with NT, consensus was reached and adjustments were made.

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Provincial Workshops1. Seven Provincial workshops were held during June / July (last held on 26

July in Bloem.)2. Workshops targeted all WSA benefiting from MWIG3. Purpose of workshops were:

1. Explain legal framework2. Discuss Roles and responsibilities3. Describe implementation plan and processes

4. Aim: Ensure compliance of DoRA requirements and build a partnership approach

5. Workshops well attended (95% of WSA attended 23/24) & well received

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Workshops: Key observations 1. Concern that public / consumers will reject interim/intermediate solutions2. Concern regarding moving target of backlogs3. More than 70% WSA do-not want localised solutions and prefer regional

schemes.4. Most complained about conditions and requirements of MWIG5. Most indicated that funding is not enough and will not achieve objectives.6. Lack of funding of O & M is a big treat to service delivery7. Lack of revenue connection /financial management is a big threat to delivery8. Limited use of Water Boards , WSA choose not to use them (FS exception)9. WSA outside 24 DM, raising need to expand Grant to include them10. A number of LM unhappy with performance of WSA11. Planning in most WSA is poor12. More than 75% of WSA indicated they would use term contracts developed

by DWA.

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General Outcomes of Workshops

1. Commitment and Support of programme 2. Better understanding of programme objectives3. Improved relationships4. Deadlines for processes emphasised /agreed5. Agreement to urgently look at policy regarding rural water

supply

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5: Example and analysis of projectsPER PROVINCE District

Municipalities (Action List Settlements)

District Municipalities(MWIG Projects Per DM)

District Municipalities (MWIG Projects classification)

EASTERN CAPE OR Tambo OR Tambo OR Tambo

KWAZULUNATAL

LIMPOPO Vhembe

Sekhukhune

Vhembe

Sekhukhune

Vhembe

Sekhukhune

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Example type 1: Gaps in MIG infrastructure projects

The diagram above illustrates that a reservoir is to be built through MIG to supply water to the entire region illustrated in light blue. Within that region however, it is identified that there is no reticulation to a specific community (Village A). In such instances MWIG will fill in the gaps and develop the infrastructure that will connect Village A to the rest of the water supply network.

Reservoir to be built through MIG supplying the entire area

Village A not receiving water due to lack of reticulation infrastructure

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Example type 2: Extension of infrastructure

The diagram above illustrates that a MIG project was previously implemented but subsequent to the completion of the project adjacent communities have been established. The MWIG project will try and address such new communities by extending or augmenting the existing infrastructure.

Community B: Extended on the boundary of the existing settlement

Area supplied by MIG project in the past

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Example type 3: Water Conservation and Water Demand Management

A common problem is that part of the area, usually high level areas, or areas furthest from the source, do not receive water although there is infrastructure, owing to the high water demand of upstream users. This is very common due to illegal connections and due to excessive usage by consumers who do not pay for water. The proposed MWIG project will be to implement WC/WDM measures throughout the entire region in order to enable adequate pressure in the reticulation system to reach the areas that are not receiving water

Area supplied by existing infrastrucure / MIG project in the past

Community C: Has infrastrcuture but no water

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Example type 4: Interim, IntermediateThere is a planned MIG or RBIG project but such projects will only be completed at some point in the future - beyond 2017. In such instances the proposed MWIG projects will either provide interim or intermediate solutions. An interim solution could be the provision of bore holes or even a more temporary measure such as rain tanks. An intermediate solution could be a solution that provides part of the infrastructure that will provide water but not to basic standards. Such infrastructure can subsequently be upgraded to provide full basic water services when money becomes available through MIG.Example type 5: Acceleration of MIGA project which has been defined / designed and approved by MIG but no money is available to implement. This will be limited to projects that are not very big and where economically viable to supply basic water instead of intermediate( per HH cost is below R 6000)

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6: Key Challenges / Risks

Key challenges to MWIG and providing some water to all

1.Significant unit cost for rural water supply particularly in KZN 2.Resistance/rejection to rudimentary localised solutions and the use of Community based organisations3.Moving target , new backlogs.4.Resistance to the use of Water Boards by some weak WSA5.Need for similar interventions outside the 24 DMs.6.Lack of revenue connection /financial management (and governance) of financial management in WSA threatens sustainability of interventions

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Examples of projects submitted to MWIG

Gadiboe (NC): Cost = R6,539,420 and HH = 149 therefore cost per HH = R44,185

GaRuele (NC): Cost = R6,952,772 and HH = 110 therefore cost per HH = R63,207

Drieloop (NC): Cost = R6,980,489 and HH = 34 therefore cost per HH = R205,308 ?????

Kwakulu Rural Water Supply Programme (KZN): Cost = 19 500 000,

HH = 445 therefor cost per HH = R 43 820

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Greatest challenge: cost of rural water supply particularly in KZN

• KZN indicated that the infrastructure cost for water supply is more than R 32 billion.

• Current averages for basic water supply in KZN are more than R35 000 per household

• This is due to the topography, location of water resources and the low density of populations.

• The cost estimate for an interim, intermediate water solution for the entire province will cost up to R 7 billion (the above figures have only be compiled after the MWIG motivation was submitted)

• Approximately 50% of the national backlogs in the 24 priority DMs are in KZN.• The high unit cost of rural water supply are not unique to KZN and also apply in

other regions such as Northern Cape• Unless alternative options are adopted or extra funds allocated , KZN will cause

the failure of MWIG to achieve the aim of some water for all

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Conclusion1. DWA has already carried out a lot of work in preparation for the

implementation of MWIG.2. A number of projects have started and the first transfer has been

made.3. The unit cost and funding requirements for a number of the

projects proposed are significant higher than anticipated4. Considering the slow cash flow projections and limited budget in

the 1st year, there are no significant problems envisaged for the 1st year and DWA is confident that the Programme will be implemented effectively

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END

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