THE RISK COVID-19 POSES TO SOUTH AFRICA’S WATER SUPPLY

Household water supplies may fall victim to the COVID-19 pandemic – if users can no longer pay their bills, and municipalities’ revenue streams dry up.

Service delivery, including the provision of water, is the cornerstone of all economies. Non-payment affects the entire value chain upstream, and if our five big metros are already reporting tough times, how can we expect the smaller, poorer municipalities to survive?

Cape Town recorded R900 million in outstanding rates and service payments in April 2020 alone – or a one-third drop in income. The City of Johannesburg announced it will revise its budget to cater specifically for COVID-19 repercussions as the number of ratepayers and residents paying their municipal bills continues to fall.

It’s a very difficult space as the course of the pandemic remains uncertain. The vicious circle will impact not only supply, but also investment in equipment, upgrades, maintenance, and preparation to meet growing future demand. How can one invest in major capital expenditure if revenue streams are starting to slow down?

In our current scenario, although non-payment is on the increase, so is domestic water usage especially. Therefore, municipalities have to pay the water utility for the supply, but are not recouping the equivalent to fund the purchase. The challenge of this non-revenue water is one that South Africa has been battling for a long time. We sit with an efficiency problem which means that for every 100 units that municipalities buy, 50% to 60% of that water is lost. So they pay for the 100, but only get 40 and already stand in a bad place. This puts reliable payers at risk, including the big payers, or businesses, which are using much less water due to the lockdowns anyway. It would be useful to know what the thoughts are currently within the municipal space about balancing revenue with service provision, because that will be difficult to do in a crisis like this.

South Africa is doing a good job of trying to secure water supplies for more people, especially in informal settlements, adding water and sanitation while also sending tanks to remote areas and to schools. But it comes at a price.

Water is a prime focus usually, and more so now as we battle the COVID-19 pandemic. Unfortunately, water is not free, and the country should make certain that it has the capacity to fund and maintain this critical infrastructure into the future.