ACTIVITY REPORT No. 30

Issues and Options for Transfer of Water Distribution Responsibility to Local Government Structures in the Bushbuckridge, Hazyview, and Nsikazi North Areas of South Africa

November 1997

by Dan Edwards Robert Firestine Jonathan Hodgkin Carolyn McCommon

Prepared for the USAID Mission to South Africa under EHP Activity No. 370-CC Environmental Health Project Contract No. HRN-C-00-93-00036-11, Project No. 936-5994 is sponsored by the Bureau for Global Programs, Field Support and Research Office of Health and Nutrition U.S. Agency for International Development Washington, DC 20523 CONTENTS

ACKNOWLEDGMENTS ...... iii ACRONYMS ...... v EXECUTIVE SUMMARY ...... vii

1 INTRODUCTION ...... 1

1.1 Background ...... 1 1.2 Scope of Work for the EHP Team ...... 6 1.3 Methodology ...... 7 1.4 Team Composition ...... 7 1.5 Report Organization ...... 8

2 WATER SUPPLY IN THE PROJECT AREA ...... 9

2.1 Overview of the Provisional Bushbuckridge Water Board Service Area .... 9 2.2 Existing Water Supply Infrastructure ...... 10 2.3 Current Water Supply Policy ...... 13 2.4 Current and Planned Water Supply Improvements ...... 14

3 FACTORS AFFECTING TRANSFER TO LOCAL GOVERNMENT ...... 17

3.1 Social and Consumer Context ...... 17 3.2 Technical Performance ...... 23 3.3 The Financial Situation ...... 25 3.4 Institutional Structures ...... 27 3.5 System Management ...... 29

4 CONDITIONS FOR TRANSFER OF WATER SUPPLY TO LOCAL GOVERNMENT ...... 32

4.1 Management Requirements ...... 32 4.2 Financial Requirements ...... 34 4.3 Technical/Engineering Requirements ...... 37 4.4 Social and Consumer Requirements ...... 39 4.5 Human Resource Development Requirements ...... 40

5 OPTIONS FOR WATER SUPPLY MANAGEMENT ...... 42

i 5.1 Criteria for Selecting a Governance Structure ...... 42 5.2 Options for Governance Structure ...... 46 5.2.1 The Direct (Local) Administration Model ...... 46 5.2.2 The Municipal Company Model ...... 47 5.2.3 The Contract Model ...... 49 5.3 Functions of a Water Service Organization ...... 50 5.4 Illustrative Water Supply Management Organization ...... 51 5.5 Illustrative Cost Structure ...... 54

6 RECOMMENDATIONS FOR TRANSITION TO LOCAL STRUCTURES ...... 56

6.1 Key Assumptions for Moving Forward ...... 56 6.2 Dimensions of the Transformation Program ...... 57 6.3 Recommended Actions for the Short and Medium Term ...... 60 6.4 Conclusions ...... 62

BIBLIOGRAPHY ...... 63

MAP OF PROJECT AREA ...... 11

TABLES

1 Demographic Information ...... 9 2 Summary of Estimated Expenditure Budget of a Hypothetical Water Service Organization ...... 54

FIGURES

1 Transition Design ...... 3 2 IDP Project History ...... 5 3 Relationship between the Water Service Organization and Other Governmental Structures ...... 43 4 Structure of a Water Service Organization ...... 52 5 Key Program Actors ...... 57

APPENDICES

A Persons Contacted and Interviewed B Population Data and Infrastructure Programs C Technical and Engineering Information D Institutional Structures

ii E Financial Analysis

iii ACKNOWLEDGMENTS

This report would not have been possible without the cooperation and assistance of local officials and institutions. The Coordinating Committee for the Institutional Development Project was very forthcoming in providing information and orienting the EHP team to the critical issues facing local authorities. We appreciate their assistance inorganizing meetings at the regional level with other members of the TLCs and LRDCs as well as with community members. The Department of Water Affairs and Forestry was helpful in providing information. We appreciate the assistance provided by the engineering firms, especially Africon which provided maps in addition to overall data. Discussions with regional authorities in Pietersburg and Nelspruit and the NGOs, Mvula Trust and Leon Foundation, were enlightening on a number of critical aspects. Finally, the cooperation of Rand Water’s Community Based Development Program and the local Rand Water and Provisional Bushbuckridge Water Board staff was important in facilitating our visit and providing orientation. We especially tank Frank Khumalo, Elizabeth Malungane, Zulu Seeane, Gibson Nkuna, Lehlohonlo Pelepele, and Sifora Macia.

iv v ACRONYMS

BOTT build-operate-train-transfer program

BWB Bushbuckridge Water Board

CDO Community Development Officer

CRDC Community Reconstruction and Development Committee

DC District Council

DWAF Department of Water Affairs and Forestry

DWAF/M Department of Water Affairs and Forestry, Mpumalanga

DWAF/NP Department of Water Affairs and Forestry, Northern Province

EHP Environmental Health Project

IDP Institutional Development Project kl kiloliter

Km kilometer l/c/d liters per capita per day

LRDC Local Reconstruction and Development Committee

MCA Ministry of Constitutional Affairs

Ml megaliter

NGO nongovernmental organization

O&M operations and maintenance

ODA Overseas Development Administration (U.K. agency)

PSC Project Steering Committee

R Rand, the local currency (Exchange rate: R4.48300 = US$1.00)

RDC Reconstruction and Development Committee

vi RDP Reconstruction and Development Program

TAT technical assistance team

TLC Transitional Local Council (elected local autonomous unit of government; there are four TLCs in the BWB service area)

TRC Transitional Representative Council (elected local units of government; there is one TRC in the BWB service area--Nsikazi North)

UFW unaccounated-for water

USAID United States Agency for International Development

WHO World Health Organization

WRDC Ward Reconstruction and Development Committee

WSA Water Support Authority

WSO water service organization

WSP Water Service Provider

vii EXECUTIVE SUMMARY

BACKGROUND An evaluation of the whole project by the Overseas Development The topic of this paper is transfer of Administration (ODA) pointed out that responsibility for water distribution the first phase of the project, however services from a central governmental experimental and tentative, had agency to local government structures in a succeeded in building awareness among northeastern area of South Africa. DWAF, project steering committee members, local communities and others Responsibility for community water about the complexities of the transfer and supply is one among many services that the need for local participation. Data on are being shifted from the central social structures as well as existing water government to local government. management structures were generated Currently all water supply is under the and technical information assembled. regulation of the Department of Water The evaluation team made 20 Affairs and Forestry (DWAF), reformed in recommendations, including a suggestion July 1994 to include homeland areas. Five for a bottom-up, demand-driven local government units—Bushbuckridge approach, which this review (by an EHP (North, Midlands, and South), Greater team) maintains is yet to be achieved. As Hazyview, and Nsikazi North—are a direct result of discussions following candidates for devolution of authority for the ODA evaluation, a framework for the water services, when deemed capable of future of the project was established local administration by District Councils among the principal actors. Three and the Provincial Department of Local separate but interlinked interventions Government. Hazyview, which was were agreed to by DWAF and the steering already a township, has retained committee for the project: autonomous status but must incorporate 1. A build-operate-transfer-train (BOTT) a neighboring area, Ward 2, and expand program to establish the water services to it. Bushbuckridge Water Board (now Under South Africa’s Reconstruction termed the Bushbuckridge Water and Development Program, DWAF drew Board Establishment Program) as bulk up a project to begin to address this supplier. Rand Water was assigned mixture of water supply technical issues the role of implementing agency. and institutional/ administrative matters. It was one of 12 water projects approved 2. An operations and maintenance in September 1994 and the only project, also assigned to Rand Water institutional development attempt in the but not yet approved (the proposed water sector. The Bushbuckridge business plan is under review), calls Institutional Development Project was for Rand to provide interim assigned to Rand Water as implementing operations and maintenance of the agent, to be managed by its Community existing water treatment plants and Based Projects Department. The project boreholes that DWAF currently began in October 1995. supervises, pending transfer to a functioning Water Board.

viii 3. An institutional development program (IDP) to provide technical assistance to local government units in the formation of appropriate structures for retail operations of distribution systems (i.e., to households and standposts).

While the first two interventions are assigned to an implementing agent (Rand Water), the IDP has yet to begin funded activity.

Demographic Information

Local Authority Estimated Population Number of Communities Bushbuckridge North TLC 258,000 28 Bushbuckridge Midlands TLC 227,000 42 Bushbuckridge South TLC 373,000 25 Greater Hazyview TLC 53,000 5+Hazyview Nsikazi North TRC 148,000 15 TOTAL 1,059,000 115+Hazyview

Source: Preliminary report on Bulk Water Supply for the Bushbuckridge area, Strategic Plan, September 1997, AFRICON, et.al.

An interim coordinating committe was government representatives who serve on re-formed in July 1997 to begin to it) are the primary audience for this address the transition needs of local report. government. Following the ODA The project area of this study is evaluation of the first phase of the IDP, densely populated. The population USAID offered to assist Rand Water, as figures in the above table should be the implementing agent, in the process of considered only as indicative. Discussions capturing lessons learned and with knowledgeable professionals suggest reformulating the original project along that the estimates could easily be in error the lines suggested by the evaluation. The by more than 10%; demographic data in current study, which is referred to as “the the area are not precise. In some cases, issues and options report,” is the result of even community names are not that assistance. It is designed to help local standardized, with the old farm names government decide how to move forward. used interchangeably with village names. The report has been produced by the Existing water supply infrastructure Environmental Health Project (EHP), a falls into two major categories: 1) bulk Washington-based support mechanism water systems designed to provide water under the direction of USAID’s Office of from surface sources to multiple Health and Nutrition. The interim communities and 2) borehole sources coodinating committee (and the local designed to provide water to individual

ix communities or parts of communities. water supply system to all Both are important potable water sources communities is many years away. as only 75% of the communities are # Local authorities do not fully connected to the bulk water supply understand important technical issues network, and not all of them receive related to system planning, water reliably from the system (i.e., 24 performance, maintenance, and hours per day, or in quantity adequate to repair. meet the needs of users). # Local authorities currently do not Many factors affect the potential have the capacity to operate, transfer of water supply to local maintain, or repair the facilities which governmental structures. they will become responsible for. # Division of responsibilities within the # Most communities do not have DWAF has changed frequently, and reliable water supply service. the jurisdictional responsibilities # Unauthorized connections to the bulk between its offices in the Northern infrastructure system and to Province and Mpumalanga appear to community distribution systems have confuse local officials, contractors, a significant impact on overall system and indeed even the DWAF staff. performance. # While DWAF’s policy is to turn over # Borehole sources of water are responsibility to local government for unreliable. water services, it is not clear how long # Incomplete information about the this process will take or the specific existing bulk water system, mechanisms that will be used to community distribution systems, and accomplish transfer. borehole water supplies hampers # Local government officials are unclear planning for system development and about how the secondment process for the transfer of authority to the for staff transfer to local government Water Board and local authorities. will work or about their right to refuse # The current poor condition of the to take on any particular DWAF staff. overall water supply system will # Resources for transfer have not been complicate transfer of assets and provided to local governmental responsibility to the Water Board and structures, and the prospects for local authorities. income generation are weak. # Current operation, maintenance, and # Land titling issues complicate the repair programs and practices are not potential for viable local government sufficient to maintain the water in the project area. supply infrastructure to acceptable # The jurisdictional status of standards. Bushbuckridge as a part of the # Local authorities, which will Northern Province continues to create ultimately be responsible for water confusion. supply provision, are not adequately involved in the planning process. There are at least three potential ways # Infrastructure development plans do that local government authorities can not appear to address citizens’ desire structure their future water service for household connections. organization: # The goal of providing a reliable amount of water through the bulk # direct (local) administration model

x # municipal company model An illustrative expenditure budget of a # contract operations and maintenance hypothetical WSO has been constructed model as a guide to local authorities for their future planning. Fully staffed and Local govenment authorities can providing water to a hypothetical operate their water distribution service population of 300,000, the total annual either as a water department in a typical expenditure of the WSO is estimated at town or township (appropriately linked to R15.325 million. Calculations in the community water committees), or they hypothetical case indicate that it would could set up a municipal company be financially quite difficult for the WSO (complete owned by the local to introduce a phased program of government). As a third option, the water metered stand connections if subsidies organization could be operated in the are phased out over as short a period as form of a contract with a private firm. five years. Break-even tariffs would be Each of these operational models and unacceptably high under the most their strengths and weakness are realistic assumptions, and more described in Chapter 3. No particular acceptable tariff levels would generate model is recommended over another, but crippling operating deficits for the the municipal company model may have organization. Even if subsidies were potential for being the most effective extended to 8 or even 10 years, break- option, given the size of the populations even tariffs would be moderately high, to be served. Each local government will but perhaps not so prohibitive. need to decide which approach is most The lowest feasible monthly payment suitable for its circumstances. levels generated in the calculations, with Several criteria should be considered varied length of time for subsidies, were in structuring the new water service in the range of R60 to R80 per month per organizations (WSOs): household. This figure was reached with subsidies being phased out over a period # operational autonomy: ability to of 8 or 10 years, rather than the currently manage without interference in daily announced 5 years. If the bulk water operational decisions purchase price paid by the water service # responsiveness to consumers and organization were to double to R2.00 per ability to link with existing community kl—not an unreasonable figure—these structures average monthly water bills would # efficiency: capacity to achieve increase by half. Although these economies of scale and operate projections (and the other, higher economically estimates under various scenarios) # capacity to grow and transform appear to be unacceptably high, further # ability to manage staff without study of the matter may not support that outside interference conclusion. The only documented # flexibility to meet growth evidence available to the EHP team requirements and to address complex suggested that some households might management issues accept a monthly payment of R20 to R40 # ability to operate with a self-contained for good quality water service (of budget unspecified volume). Households’ acceptance of monthly water bills in the range of R60 to R80—if that were indeed

xi the eventual break-even tariff—might water management services in the actually depend as much on the quality Bushbuckridge, Greater Hazyview, and and reliability of the improved service as Nsikazi North project area. The purpose is on cost. to provide improved access to water services for the populations in the project The EHP team arrived at the following area while improving local capacity for conclusions about the approach and sustainable and participatory resources needed to move forward on the management, and ultimately improving transfer of services: the health of the population. The program as proposed in this # Local authorities will need assistance report aims to strengthen human in making the transition from the resources, develop systems, structures present to their future full and procedures, and provide commodity responsibility for water distribution. support (offices, equipment). # Transformation will require specific Performance improvement efforts should financial and specialized human be divided into several component areas resources. (each area will need specific advisory # In order to move forward, the support): problem must be defined as “developing capacity for water # organizational development and distribution structures” rather than as structuring generically developing local # human resources development: government or building community training in managerial skills, including capacity. financial management, personnel and # The most appropriate organization to administrative systems development, support the development of WSOs at supervisory skills, program any level is the DWAF. management, and strategic planing # Relationships among all the key # consumer and outreach services stakeholders are critically important. # community water management Roles need to be kept clear structure development throughout the transition. # technical skills training # The specific strategy for transfer of water distribution to local authorities Several short- and medium-term actions will need to be developed, as will a are recommended: structure for implementation beyond present efforts. # Short-term actions # The capacity-building program should • Revitalize the project coordinating be focused on local authorities and committee and legitimize it. community organizations, and the • Disseminate this “issues and most appropriate skills available options report.” locally should be strengthened with • Refocus the strategic plan for the assistance from a number of sources. Institutional Development Project. • Clarify the funding process for the The goal of the transformation project and determine availability program should be to develop the of funds. capacity of future water distribution organizations and community-based # Medium-Term Actions

xii • Conduct a follow-up review of this develop the details in a project report. design and scope of work; develop • Further develop a program design terms of reference for the for the transformation process, proposed technical assistance and team. • Conduct an open solicitation and publish a request for proposals to procure a technical assistance team as a contractor (not an implementing agent). • Further develop a program design and project activities for “The Transformation Program for Developing Local Government and Community Capacity for Water Distribution” in the Bushbuckridge, Hazyview and Nsikazi North areas. • Set up a subcommittee of the project coordinating committee (at this time, it should probably become the project steering committee) for project management. This could include a local government representative, an RDP representative, a DWAF representative, a TLC/TRC representative, a Water Committee representative, and the team leader for the technical assistance team (once engaged). • Begin implementation of the “The Transformation Program for Developing Local Government and Community Capacity for Water Distribution” in the Bushbuckridge, Hazyview, and Nsikazi North areas.

xiii 1 INTRODUCTION

1.1 Background The service areas discussed in this report will be provided water in part by a new A Government in Transition unit, the Bushbuckridge Water Board or BWB, to be created within the next two South African transition policies and years. A variety of water treatment plants, programs are designed to support the direct river extraction for irrigation, and formation of democratic local structures boreholes exist in the Sabie River and and institutions, with devolution of Sand River watershed in northeastern authority for community services from South Africa. The catchment area drains central ministries and former homeland from the Drakensberg mountain range administrations to newly formed local escarpment, crossing jurisdictional and government structures. The provincial lines, and leads into the Kruger Reconstruction and Development National Forest Reserve. Groundwater Program (RDP) frames the policy and availability decreases with distance from program structures for this process. This the escarpment towards the east. The fundamental change was initiated by the service area comprises the political Government of National Unity in April jurisdictions of Bushbuckridge (North, 1994. Community water supply is one South, and Midlands), Greater Hazyview, service, among many, now being put into and Nsikazi North areas. the hands of local government. Currently The RDP has structured new all water supply is under the legal jurisdictions, combining former regulation of the Department of Water homelands and townships with Affairs and Forestry (DWAF), reformed in traditional white farming communities July 1994 to include homeland areas. and towns. Such is the case in the future National policy requires bulk supply of BWB service area where two former treated water by large regional service homelands (Lebowa and Gazankulu) have providers, called Water Boards. In large been combined to form (provisionally) urban areas, Water Boards have operated Bushbuckridge North, Midlands, and for many years as cost-effective, South. The District Council in Pietersberg, commercially oriented providers; until located in the Northern Province some recently, none have been set up or three hours distance by automobile, operated in former homeland or rural administers local government units in the areas. It remains to be seen if financial Bushbuckridge area. Hazyview, a viability will be possible in marginalized, traditional white farming and tourist poor rural areas. center at one major entry point to the Kruger National Forest Reserve, has been The Project Service Area combined with a neighboring peri-urban area on the east and south side (Ward 2).

1 Nsikazi North is an area of densely settled the system, DWAF is required by law to rural villages north of the White River do so. area (a traditional white town) and is the former Kangwane homeland. Greater The Complications of Jurisdictions in Hazyview and Nsikazi North belong to the Service Area Mpumalanga Province and are administered by the District Council in The transition period is characterized by Nelspruit. role confusions and overlapping and misunderstood responsibilities in the The Transition Scenario for Turnover to provision of services. Chapter 2 describes Local Government current institutional structures and technical arrangements for water supply The local government units of in more depth. In the BWB service area, Bushbuckridge (North, Midlands, and local government units are new and are South) and Nsikazi North are candidates attempting to set up services with little for devolution of authority for services support and almost no financial base. but must be judged capable for local Politics complicate this process. The administration by District Councils and people living in Bushbuckridge have felt the Provincial Department of Local ill-served or even abandoned by the Government. Hazyview has retained geographically and politically distant autonomous status but must incorporate Northern Province District Council. In Ward 2 and expand water services to it. June and July 1997, strikes, road DWAF’s policy is to turn over blockages, and general disturbances took responsibility as soon as technically and place along the main road transversing financially possible within the next five the Bushbuckridge area. There was a years, but the transition process has not general call to separate Bushbuckridge been designed, nor funded in most cases, from the Northern Province1 and attach it and will likely require a much longer time to the Mpumalanga Province to the south, frame. As illustrated in Figure 1, when where people have traditionally related to turnover takes place, legal responsibility the capital city, Nelspruit, as their main for distribution of water, sanitation urban center. This matter continues to be management, and purchase of bulk water under review at higher levels and appears from the BWB will be required. In addition, administration of self-contained boreholes within jurisdictions and 1 management of small water treatment Interviews with RDC and other officials plants will be handled locally. Decisions indicate that a political understanding was reached (referred to as the “World Trade Center Agreement”) on precisely which water treatment plants soon after the 1994 elections that Bushbuckridge would will be given to the Water Board and be transferred to Mpumalanga Province. Consequently which will be given to local government program initiatives to support both local government have not been made. DWAF’s policy and civil society structures from Nelspruit began with requires that all newly constructed vigor and promise in 1995, assuming the area would be infrastructure be turned over within one a part of Mpumalanga. These efforts have dwindled as year of completion to either Water Boards it became increasingly clear that this understanding or local government. Should local would not be acted upon. Northern Province attention to the area has not been forthcoming and a “wait and government not be capable of managing see” attitude towards the Bushbuckridge area has prevailed.

2 to be at a political impasse. A proposal has been put forward by the District Council in Pietersberg to form the Bushbuckridge area into a separate district of Northern Province, but this has not been acted upon. The fate of Bushbuckridge continues to be in limbo, according to interviews conducted in Pietersberg and Nelspruit. Given this situation, governmental authorities are reluctant to invest in and support the area with economic development activities or efforts to strengthen local government.

A Stop-Gap Approach to Meet Needs Is Inadequate

DWAF is legally charged with making water available to all citizens (either directly or through implementing agents such as Water Boards or contractors). DWAF’s orientation is engineering and public works rather than retail

Figure 1 Transition Design

3 distribution and community involvement. systems with the assistance of private Where DWAF must operate and maintain nongovernmental organizations (NGOs), systems itself, it does so primarily such as the Leon Foundation Water through contracts with engineering firms. Programme and Mvula Trust, supported However, DWAF has inherited the O&M by DWAF. Water is free of charge in most staff in the service area from the former rural communities and in some of the Homelands Administrations and is larger towns. currently operating small treatment Intermittent and inadequate supply plants and borehole pumps directly until requires community water fetchers to cue it is able to pass staff over to new local up for long periods to receive the daily government water departments or the allowance at borehole-supported public new Water Board, or to contract for taps. Diesel motors often run out of fuel, operating services until turnover is and communities wait passively until possible. A management audit conducted something is done. by Ernst and Young in the service area Urban systems with meters (such as (commissioned by DWAF through the the town of Hazyview) collect tariffs. BWB establishment project and its Some rural villages have boreholes with implementing agent, Rand Water) sufficient water to install distribution indicated there are approximately 870 systems to individual yard connections, staff inherited from the Lebowa and which are not yet metered. Communities Gazankulu Departments of Public Works. that have been delegated autonomous A large dam project (Injaka Dam) is status may retain water fees; direct under construction to provide bulk supply administration communities must pass on and agricultural water for a portion of the collections to DWAF. Most local service area, but drinking water will government units in the service area probably not be available from the dam under study do not collect tariffs for for three or more years. In reality, water water and have no incentive to do so. A supply service in the project area is very general assumption that water is inadequate, and a major planning effort provided free of charge has evolved in the is underway along with stop-gap former homelands areas, and local measures until the new Injaka Dam politicians do not believe people should project is operational. Short- to medium- be required to pay unless service is term efforts include four small water upgraded and adequate water is provided infrastructure improvement projects and and appropriately metered and billed. refurbishment contracts to rectify a maze of inadequately installed systems and The Institutional Development Project transmission lines riddled with unauthorized connections. Once the changes in governmental In the absence of adequate service in approach and structure were initiated in the past and present administrations, 1994, DWAF quickly designed a project to many rural communities have formed begin to address this mixture of water water committees, drilled boreholes, and supply technical issues and set up small distribution standpost institutional/administrative matters, one

4 of 12 water projects approved in were generated and technical information September 1994 and the only specifically assembled. The project received relatively institutional development effort in the low marks on communication, clarity of water sector. DWAF had little experience purpose, and building upon local with rural water supply and was not structures. Local water councillors had familiar with the area or the social and increasingly begun to participate both political context; new governmental during and soon after the evaluation policies did not clearly define period, and this held promise in the eyes responsibilities. The Bushbuckridge of the evaluators. Institutional Development Project, which The ODA evaluation team made 20 began in October 1995, was assigned to recommendations, including a suggestion Rand Water as implementing agent, to be for a bottom-up, demand-driven managed by its Community Based approach, which this current review team Projects Department. Rand Water is a feels has yet to be fully accepted. As a Water Board which supplies the urban result of discussions following the ODA area of Johannesberg and Pretoria. It is evaluation, a framework for the future of the largest bulk supplier in the country the project was established but has had little experience with rural, peri-urban areas until recently. As with other projects quickly launched in early days of RDP, the Institutional Development Project for Greater Bushbuckridge and Northern Mpumalanga Local Government Water Supply, as it is formally called, encountered a number of growing pains and spent its first 18 months learning how to operate within the newly emerging and transitional structures and defining technical and institutional needs. An evaluation of the project2 by the Overseas Development Administration (ODA) pointed out that the first phase of the project, however experimental and tentative, had succeeded in building awareness among DWAF staff, project steering committee members, local communities, and others about the complexity of the issues and the need for local participation. Data on social and existing water management structures

2 The ODA evaluation is commonly referred to as “the Rees report” after one of its authors, Professor Judith Rees of the London School of Economics. (See Rees 1996.)

5 Figure 2 IDP Project History

among the principal actors. As illustrated 2. Under an operations and in Figure 2, three separate but interlinked maintenance project, also assigned to interventions were agreed to by DWAF Rand Water but not yet approved (the and the steering committee for the proposed business plan is under project: review), operations and maintenance of the existing water treatment plants 1. A build-operate-transfer (BOT) and boreholes that DWAF currently program to establish the supervises will be provided by Rand Bushbuckridge Water Board is on an imterim basis until BWB or funded through the Goverment of local government units can pick up South Africa’s RDP effort, with Rand the function. This O&M project is Water as the implementing agent primarily a management services (now termed the Bushbuckridge contract. The staff of DWAF now Water Board Establishment Program). working in the area will work under Rand Water is charged with this contract, supervised by Rand, developing a Water Board institution until they are seconded and assigned and leaving in place a viable technical to local government units or the new and administrative operating body Water Board. which can function on its own as a 3. An institutional development public sector company (parastatal program (IDP)3 will provide technical entity). The BWB Establishment Program will assume operations and 3 maintenance of existing bulk water A note about terminology. Broadly speaking, treatment facilities in the area at a the Water Board establishment process is an institution- building activity with a combination of technical and future date when DWAF judges the managerial development activities required for bulk BWB capable of operating and water supply. A program to support local government maintaining the infrastructure. in its structuring of the water services function is also an

6 assistance to local governments (often project activities identified in the original referred to as the Technical Assistance IDP. The broad aims of the grant do not Program) in the formation of limit funding to the Water Board appropriate structures for retail Establishment Programme (listed above operations of reticulation systems. as intervention number 1). Assistance is also available to local government (listed While the first two interventions are above as intervention number 3) in currently assigned to an implementing project strategy assistance, training, and agent (Rand Water), the IDP has yet to capturing lessons learned. It is also begin funded activity. At the moment, designed to help local governmental there are questions from DWAF and the structures to select the appropriate Ministry of Constitutional Affairs about institutional options and to strengthen which agency should be responsible for project staff and emerging institutional strengthening local governmental structures in performance requirements capacity for water distribution. DWAF in technical areas of application. staff in Mpumalanga believe that the Following the ODA evaluation of the Ministry of Constitutional Affairs (MCA) first phase of the IDP, USAID offered to has jurisdiction for local government and assist DWAF and Rand Water (as the should appoint an implementing agent implementing agency) in the process of for the activities related to local capturing lessons learned and government capacity-building. However, reformulating the original project along it is unclear if the MCA has the funding to the lines suggested by the evaluation. undertake this task. (DWAF currently has USAID, which draws upon centrally USAID grant funding for these activities.) funded technical resources for assistance A project design and a terms of reference of this nature, called in the will be required for this activity. Environmental Health Project (EHP). EHP was created by USAID as its technical USAID Involvement in Support of the assistance arm for water and sanitation IDP strategic activities worldwide, among other functions. EHP operates through a The USAID Mission to South Africa has contract consortium supported by the provided a grant to DWAF to support Office of Health and Nutrition in USAID’s Rand Water’s Community Based Projects Global Programs Bureau. Department in its initial implementation In May 1997, USAID requested that effort for the Bushbuckridge IDP. The EHP staff and/or consultants attend a grant’s purpose is to “ensure adequate strategic planning workshop conducted access to water supplies and sanitation for the interim working group of the IDP services to the people of Bushbuckridge to disseminate some of the lessons and the Mpumalanga Province project learned by EHP and its predecessor area through the creation of appropriate project during 17 years of sectoral water management institutions.” USAID’s activity around the world, particularly in technical assistance goals are to assist building water institutions. The action plan which came out of the May workshop identified the need for an institutional options study on ways to institutional development activity; it is aimed at consumer relations, administration, finance, and strengthen local administrative structures operations and maintenance on the retail water level. for water supply, among a number of

7 other aims. EHP drafted terms of report. Following that, a dissemination reference for this study. USAID asked EHP workshop will be held by EHP for the to conduct the study because the Coordinating Committee. The final issues organization has extensive experience in and options study (this document) and this area and has no vested interest in a the subsequent decisions by the five TLCs particular outcome. In July 1997, the will create the framework for a project for interim working group reviewed the institutional development for the water terms of reference and agreed to the distribution and sanitation functions. The appointment of EHP to conduct the study. follow-up workshop will seek to develop consensus for specific options. A detailed 1.2 Scope of Work for the EHP project design for implementation of the Team local government IDP may be developed as a result of this report and the subsequent workshop, but this possibility The purpose of the EHP activity was to is not currently approved as an activity by assist the Coordinating Committee, either USAID or the Coordinating representing the BWB service area’s Committee. Transition Local Councils (TLCs) and Reconstruction and Development Committees (RDCs), in deciding the 1.3 Methodology appropriate mechanisms for providing water service delivery consistent with To undertake this study, a team of four national policy and community goals. The senior EHP consultants, working with a activity aimed to identify issues and variety of local resource people, was constraints, and to suggest a way to move assembled for a four-week period. The forward in the transition process toward EHP team applied a rapid appraisal local administration of water supply. The approach, one which quickly collects a study was in essence a fact-finding great deal of information and develops mission to assemble information and to understanding of the local setting. In this suggest suitable structures for approach, multidisciplinary skills (e.g., establishing an appropriate water service engineering, anthropology, management delivery system. The study included an sciences and institutional development, examination of the financial, technical, and financial/economic analysis) are organizational, human resources, and combined with a development, or change, social/community needs and perspective to create a picture of the requirements to be met. Consideration actual and desired state related the was given to appropriate management problem under study. In this approach, entities that could join TLCs together to the team reads (collectively) large provide more cost-efficient and amounts of written material (evaluations, responsive services. studies, policy documents, business A draft “issues and options report” plans, program descriptions). Individual was required prior to team departure and group interviews are conducted at from South Africa. A two-month reading different levels (community, agency, local and study period was anticipated so that government, implementing agent and the Coordinating Committee could work individual informant). with each local government to fully During this study five communities understand the suggestions made in the were visited. Workshops were used to

8 interact with key individuals (such as the Community Based Projects Department Coordinating Committee) and to test out helped by assembling written information emerging ideas and working assumptions such as studies and legal documents and discovered in the field work. The EHP by organizing the team planning meeting team interacted with key individuals in in Hazyview. The Coordinating three workshop settings during the study Committee members served as key period. Interviews were conducted at informants on local structures and issues each TLC with elected councillors and and provided valuable feedback as the civil society representatives. The team team gathered information and presented visited government agencies in Nelspruit it to them. The engineering investigation and Pietersberg, interviewed contractors was aided by the Operations and and individual consultants, and reviewed Maintenance group in Bushbuckridge business plans and engineering studies. working for Rand Water. During the process, the team met regularly to help each other understand the implications of one disciplinary area for another and to share and verify information from differing perspectives. This final report was written by the entire team. For a list of persons interviewed or contacted, see Appendix A. For a list of materials read, refer to the bibliography.

1.4 Team Composition

The EHP team consisted of four people:

# Dan Edwards: Team leader. Responsible for analysis of organizational and management areas, institutional development project design, and training issues. # Jonathan Hodgkin: Engineer. Responsible for technical analysis and technical manpower issues. # Carolyn McCommon: Anthropologist. Responsible for consumer, social, and community analysis. # Robert Firestine: Economist. Responsible for financial analysis.

The team was assisted by local project staff of the Provisional Bushbuckridge Water Board for organization of appointments and logistical support and for key information. The Rand Water

9 1.5 Report Organization

Following this introductory chapter, the existing water supply situation in the study area is summarized in Chapter 2. Chapter 3 identifies the key issues that will need to be addressed if transfer of water distribution to local athhorities is to be accomplished. (Additional supporting details are provided in Appendices B through E.) Chapter 4 suggests the conditions necessary for TLCs to be able to operate and maintain distribution systems. Indicators for successful operations are presented was well. Chapter 5 describes a typical water service department and the possible administrative arrangements for appropriate roles of major entities such as DWAF, BWB, local councils, and water committees. Criteria are suggested for selecting the appropriate options. Chapter 6 presents recommendations for how to move ahead. A suggested transformation program is described, and the conclusions and next steps are presented.

10 2 WATER SUPPLY IN THE PROJECT AREA

Water supply systems consist of the of the Sabie River, and 620 km2 south of infrastructure and hardware for water the Sabie River). The BWB service area delivery along with the financial, includes Bushbuckridge which falls within management, and staffing systems Northern Province, and Greater Hazyview necessary to support continued and Nsikazi North which fall within infrastructure maintenance for the long- Mpumalanga Province. Administratively, term benefit of water users. This chapter Bushbuckridge is divided into three local provides a brief description of current authorities, currently governed by TLCs. infrastructure and policies and planned Greater Hazyview now includes the improvements for sustainable support. traditionally white area (Ward 1) and five traditionally black communities within 2.1 Overview of the Provisional the former Kangwane (Ward 2). The Bushbuckridge Water Board remaining communities fall within the White River and Nsikazi Local Authority Service Area administered as a Transitional Representative Council (TRC). General Information Demography As mentioned in Chapter 1, the Provisional Bushbuckridge Water Board No reliable population figures exist for (BWB) service area lies within the the service area, but the best available Lowveld region of northeastern South information suggests that about Africa, within the lower part of the Sabie- 1,050,000 people live there in some 115 Sand catchment area just to the west of recognized communities. About 80% of Kruger National Forest Reserve. The total this population live in the Bushbuckridge service area is roughly 3,300 square part of the service area, while kilometers (2,680 km2 in Bushbuckridge north

11 Table 1 Demographic Information

Local Authority Estimated Population Number of Communities Bushbuckridge North TLC 258,000 28 Bushbuckridge Midlands TLC 227,000 42 Bushbuckridge South TLC 373,000 25 Greater Hazyview TLC 53,000 5+Hazyview Nsikazi North TRC 148,000 15 TOTAL 1,059,000 115+Hazyview Source: Preliminary Report on Bulk Water Supply for the Bushbuckridge area, Strategic Plan, September 1997, AFRICON et al. the remainder are in the Nsikazi and All of the former homelands depended Greater Hazyview areas south of the heavily on the South African consulting Sabie River. (For a complete list of towns, engineering and construction companies see Appendix B.) to plan, design, and build water supply The population figures in Table 1 are systems and to drill and equip boreholes. rough estimates. Discussions with Hazyview, a white area, managed its own knowledgeable professionals suggest that system with assistance and support of the they could easily be in error by more than former provincial and national 10%. In some cases, even community government. names are not standardized, with the old In 1994, when DWAF took over farm names used interchangeably with responsibility for the planning and village names. provision of water supplies from the former homelands (including absorbing Background History former homeland staff), it had no information regarding the existing water Prior to 1994, the homelands areas of supply infrastructure. Although DWAF has Gazankulu, Lebowa, and Kangwane managed to assemble a fairly good planned and implemented infrastructure picture of existing infrastructure and has projects (including water supply projects) gained some understanding of its to serve the areas within their performance, it has not been able to fully jurisdiction. Gazankulu followed an define or characterize all system approach that established water components. Much of the technical treatment plants and bulk water supply information required (including design service supplemented by diesel-driven criteria for some of the water treatment pumpsets on boreholes. The larger water facilities, location of bulk transmission treatment plants at Hoxane, mains, details of community distribution Thulamahashe, and Dwarsloop as well as systems, etc.) has still not been a number of smaller plants are a legacy of assembled because the information has this approach. Lebowa chose to depend been lost or was not properly more heavily on boreholes to meet documented in the first place or because potable water needs. Kangwane elected to ad hoc modifications (such as provide chlorinated bulk water from the unauthorized connections) have been Sabie River as the primary water supply. made.

12 2.2 Existing Water Supply Infrastructure

Existing water supply infrastructure falls into two major categories:

# bulk water systems, designed to provide water from surface water sources to multiple communities # borehole sources, designed to provide water to individual communities or parts of communities.

About 75% of the communities are connected to the bulk water supply network. Its infrastructure includes about a dozen surface water supply sources, water supply treatment plants at most of these sources, a broad interconnected network of pumping and gravity mains throughout the service area, regional storage and service reservoirs, and community reticulation systems. These are shown in Map 1 and described in greater detail in Appendix C. Although the physical network is relatively extensive, provision of water to communities from the network is often unreliable. In some cases, water is never available from bulk sources. This is due to a number of reasons including widespread unauthorized connections, population growth in the service area, inefficient treatment plant operation, and poor system maintenance. About 25% of the communities within the service area depend solely on boreholes which tap existing groundwater sources. Many other communities, which are served partly or

MAP GOES HERE -- 2 pages odd/even

13 14 irregularly from the bulk water supply authority over, water resource infrastructure, also depend on borehole management. # water supplies. There are roughly 500 The nation*s water resources should boreholes in the service area of be managed to achieve optimum, Bushbuckridge, Nsikazi North, and long-term, environmentally Greater Hazyview. Of these, about 50% sustainable social and economic are equipped with diesel-driven benefit for society. pumpsets, 5% are equipped with # Water resources should be managed electrical pumps, and most of the to ensure that all people have access remainder are equipped with handpumps. to sufficient water. At any one time, a large number of these # Responsibility for the development, systems may be out of service due to low apportionment, and management of borehole yield, lack of fuel, or mechanical available water resources shall, where breakdown. possible and appropriate, be delegated to a catchment or regional 2.3 Current Water Supply Policy level in such a manner as to enable interested parties to participate. # National Water Management Policy Beneficiaries of the water management system shall contribute The Constitution guarantees every person to the cost of establishment and the right to sufficient water, food, and maintenance on an equitable basis. health care services. It assigns responsibility for provision of Reconstruction and Development infrastructure services, including water Program supply and sanitation, to local government and spells out that it is the The Reconstruction and Development duty of the national and provisional Program (RDP) emphasizes that growth governments to make sure that local and development are essential to governments are effectively performing improvement in the quality of life for the these functions. majority of South Africans. Key RDP The White Paper on Water Policy, activities focus on meeting basic needs, which was approved by Cabinet on 30 developing human resources, building the April 1997, outlines national water policy economy, and democratizing the state objectives and principles. The policy is and society. Within this context, much of based on 28 fundamental principles the financing for water supply related to water as a public resource, infrastructure in traditionally water resource management priorities disadvantaged areas is channeled through and approaches, water-related the RDP to DWAF and its implementing institutions, and provision of services. agents. Infrastructure development Among the principles are several with financed by these funds must adhere to specific relevance to the provision of RDP policies, guidelines, and standards water supply services: which state the following: # # The National Government retains Communities must participate ultimate responsibility for, and substantively in project development and management.

15 # Physical system designs should supply # Operating assistance to existing 25 liters per capita per day (l/c/d) at schemes should be phased out over a a distance no greater than 200 meters maximum period of five years. from each household. # No operating assistance should be # Training and capacity-building for provided for new schemes (although communities within project areas the capital costs of new schemes may must be an integral part of project be provided by government). planning and implementation. # Major regional schemes should be transferred by the end of 1998, with Department of Water Affairs and all government water schemes Forestry Policy transferred by the end of the 2001/2002 financial year. National water policies have been interpreted and translated into These national policies and guidelines are operational policies and implementation the driving force behind the water supply programs by the Department of Water activities in the Bushbuckridge, Nsikazi Affairs and Forestry. This process has North, and Greater Hazyview areas. As been guided by the slogan, “Some for all mentioned earlier, the decision has forever,” which sums up the goals of already been taken to establish the access for everybody to limited resources, Bushbuckridge Water Board to manage on an equitable basis in a sustainable bulk water supply for the these areas. At manner, now and in the future. In present, the service area has been defined keeping with the decision for DWAF to and the BWB has been established on a become a policy formulation, regulatory, provisional basis. DWAF, project coordination, information collection, and implementing agents, and local dissemination agency, it has chosen to government officials are now struggling delegate its operational responsibilities to with the details of how to implement the other agencies and structures. Prominent policy of transfer of assets and among DWAF policies and guidelines in responsibility to local authorities within this regard are the approved guidelines the BWB service area. and procedures for transfer of government water supply systems to 2.4 Current and Planned Water other agencies and authorities (DWAF Supply Improvements 1997c). DWAF*s policy calls for bulk water supply infrastructure to be Current Water Supply Service Levels transferred to organizations such as Water Boards. The policy also calls for The effectiveness of current water supply transfer of water supply infrastructure to arrangements within the BWB service local government, if local government has area is not well known or understood. the capacity to manage and operate it. Some households have a reliable supply The principles guiding this process of treated and purified water, but most do include the following: not. Many households depend on borehole water sources that are # Users should pay for services received. unreliable for a number of reasons. # Assistance should be provided to Others are served intermittently by the refurbish infrastructure to an bulk supply and rely on borehole sources acceptable and functional level.

16 when bulk service is not available. In maintenance camps perform operation some communities where the need is and maintenance tasks associated with great, water is delivered by truck either the water treatment plants, pump regularly or sporadically. Anecdotal stations, bulk water supply infrastructure, evidence suggests that some people community reticulation systems, and continue to get water from nearby dams tankered water delivery when necessary. and hand-dug wells. In the Nzikasi North area, a single camp It is clear that the water supply at Malekutu performs these functions. systems are largely unreliable for most of The Malekutu camp also has operation, the service area population, with maintenance, and repair responsibility for continuing heavy reliance on other areas as well. The Works undependable diesel-driven pumpsets. No Department in Hazyview supports the detailed surveys to define water service needs of the communities there. levels and usage have been completed. It A Rand Water survey of the has been suggested that about 10 to 15% maintenance camps in Bushbuckridge of the population living close to the (Pelepel and Meulman, n.d.) highlights a existing treatment plants can expect number of significant problems related to reliable water supplies; 30 to 35% obtain operation, maintenance, and repair, adequate water from the bulk system, and including the following: the remainder (50 to 60%) depend in whole or in part on borehole supplies. # inadequate financing for maintenance The extent of the current bulk supply and repair functions system suggests that 30 to 35% of the # insufficient or poorly located stores of present population depend entirely on spare parts borehole water supplies. These figures # incomplete sets of equipment and are imprecise, since population figures tools for many routine repairs are only estimates and the reliability of # limited trained staff in electrical bulk supply at the system extremities is repair, mechanical maintenance, and unknown. pipefitting Except in the towns of Hazyview, # inadequate transportation and Dwarsloop, Thulamahashe, Shatale, and transportation support Mkhuhlu, no formal mechanism for # unclear assignment or division of payment for water supply services exists. management responsibilities Efforts are being initiated by NGO- # ineffective mechanisms for staff supported projects to establish a fee-for- supervision service system, particularly in some communities with borehole supplies. These O&M problems are also evident However, these efforts have only just in the Nsikazi North area and, to a lesser begun, and it is unclear how successful extent, in the traditionally black areas of they will be over the long term. Greater Hazyview. As a consequence, maintenance and repair tasks in much of Operation and Maintenance the BWB service area are not performed in a timely manner, many tasks are Current operation, maintenance, and beyond the capacity of the maintenance repair tasks are undertaken by different staff and must be contracted to others, service organizations in different areas. and much of the physical infrastructure is In Bushbuckridge, a set of seven now in a deteriorating state.

17 Current Infrastructure Development Planned Infrastructure Development

A range of important activities that The DWAF office in Mpumalanga has should make water more available in the begun a long-term planning process for BWB service area are underway or the BWB service area. A strategic plan for planned (the most important of these are bulk water supply for the BWB service being implemented through the DWAF area (Africon Engineering Internationals office in Mpumalanga): 1997a) which outlines the plan for provision of bulk water to every # The Injaka Dam project and first- community in the BWB service area has phase treatment works will initially provide water to Bushbuckridge and adjacent communities. # The Marite project will extract water from the Marite River to serve communities in the western part of Bushbuckridge South. # The Acornhoek project will construct facilities to upgrade bulk water supply in that area. # A construction project to build package treatment plants in the Zoeknog and Dinglydale areas will upgrade bulk water supplies there. # A project will upgrade the distribution system in Dwarsloop and improve delivery in the Maviljan area. # Roughly 100 boreholes in some 20 communities will be rehabilitated and upgraded in the Bushbuckridge area (managed by DWAF-Northern Province). # Projects will construct and/or upgrade reticulation in nine communities in Nsikazi North/Greater Hazyview (DWAF-Mpumalanga and Lowveld and Escarpment District Council).

In addition, several NGOs, principally the Mvula Trust and the Leon Foundation Water Programme, are supporting community-based programs to upgrade and expand services and support the efforts of communities to manage their own water supply service. Some details of these programs can be found in Appendix C.

18 been prepared. Although detailed feasibility studies for individual projects must be developed prior to implementation, DWAF plans to use this strategic plan as a guide for future development as funds become available. High on the list of proposed projects are expansion of the Injaka treatment works, construction of bulk water pipelines from the Injaka works so that the treated water will be available to users, and water treatment for bulk system service south of the Sabie River. Discussions are currently underway to prioritize other interventions which could be financed under the next round of RDP funding. Although financing is not yet secured, it appears that the Bushbuckridge area may receive a special allocation to address the immediate need for overall system rehabilitation and refurbishment. Detailed plans have not yet been developed, but it is expected that these funds will be used primarily to refurbish existing treatment plants and booster pump stations. In addition, some funding may be made available as part of South Africa*s preparation for drought (based on the strong El Nino event of this year). Should this be the case, some of these funds may be used to extend bulk reticulation to communities not yet served.

19 3 LOCALFACTORS GOVERNMENT AFFECTING TRANSFER TO

Water supply system performance is have profound implications on the new affected by a number of factors which fall government’s efforts to overcome the lack into several broad categories—technical, of basic services, especially in the area of financial, social, and management. This water supply. Much of the BWB service chapter provides a description of the area is typical of the former homelands, current status and findings related to where new communities were established systems necessary for the sustainable through forced population removals to support of a working infrastructure to isolated, often barren areas with meet the needs of the communities. rudimentary services. The BWB area today has one of the highest population 3.1 Social and Consumer Context densities in the country with a range of 146 people per km2 in former Gazankulu 2 The ability of local government to to 303 per km in former Lebowa (Fundile develop sustainable systems for water Africa 1996). Although detailed distribution depends in part on the ability information does not exist, it has been and willingness of consumers to pay and suggested that over half the population on effective water use and conservation do not have access to safe and adequate at the community level. It may depend as water supplies. well on the capacity of communities to Opportunities for local employment, successfully manage water systems at the even subsistence agriculture, are local level. Social and consumer factors particularly limited, with most families that may impact the strategies and dependent on male migration for income. options for service delivery are discussed Even these sources of income—albeit below. meager—have become increasingly scarce over the last 10 years as a result of the Social Context for Development economic downturn. Staff retrenchments in the mining sector have particularly impacted this area, leaving an already The depressed economy and tradition depressed economy even further in crisis. of nonpayment for water present High unemployment is reflected in the challenges when cost-recovery is high levels of poverty with few people introduced. living beyond a marginal status. Indications suggest employment levels within the formal sector are approximately 30-40% (Fundile Africa The administration of the apartheid years 1996). The levels of informal sector has left behind a fractured social and employment are unclear, but along with economic system. These lingering effects pensions do generate some income.

20 The harsh reality of very low incomes greater Bushbuckridge area without affects the ability of people to pay for access to adequate, safe water supplies. improved water service, a factor that is Most people anticipate that the further influenced by their past construction of the new Injaka Dam and unwillingness to pay. There is a culture of the completion of the other RDP nonpayment for service as a consequence infrastructure projects will satisfy the of the civil service boycotts during the local demand for water and eliminate the final years of apartheid. People have problems of limited supplies. They also become accustomed to the provision of assume that service will be improved to free water and, as the team learned in on the level of having treated and purified local discussions, are defiant in their water delivered through household refusal to pay in the future unless there connections. are significant improvements in service. Reality suggests otherwise. Given the At the same time, the “Bantu” system of government*s budgetary and resource administration for the former homelands constraints, the national “some for all” led to a dependence on—and expectation policy means that any service provided by of—government subsidies. government will be to RDP standards and, Sensitivity to such issues has left therefore, will likely not meet community many politicians and local authorities expectations of higher service levels. RDP unwilling to push for cost recovery, at policies call for standpipe connections least until the current inequities in the within 200 meters of households, a system are resolved. Because the current standard far below the anticipated level imbalances were due to political of household connections with treated, decisions, officials feel they must re- purified water. Many people, however, establish trust in the political system by assume that the national government has providing these long-absent services at sufficient funds to meet both their needs government cost. There is a strong will to and wants. They seem to believe that get organized and ensure delivery on their preferences will be met if their behalf of local communities but a lack of requirements are fully understood and expertise or discipline required to get the communicated by those in local job done. government to those in higher positions of authority. Needs, Expectations, and Resources Misguided Intentions of Local Authorities and DWAF People’s expectations for improved services do not conform to what the government can provide. Funds are not available, and community involvement is inadequate.

The values and objectives of the new government have given rise to high Clearly, the level of service necessary, expectations that past inequities in desired, and expected does not conform services will be quickly resolved. This is to what is available or affordable. This especially true regarding the provision of creates a potentially difficult situation in water where chronic and severe shortages reconciling people*s hopes with facts. The have left much of the population in the situation is further complicated by an

21 apparent lack of information or supporting such villages, but DWAF*s ad misunderstandings on the part of many hoc approach to community identification local authorities. Many officials have has been a limiting factor. Simi-larly, the themselves raised local expectations that failure of DWAF and its implement-ing there are funds “somewhere” within the agents to consult with communities at an government, other donors, or NGOs to fill earlier stage in project design stifles local the gap “if only” the right petitions or own-ership and, over the long term, will proposals are made. Conversations with affect the extent to which communities local authorities indicate a disturbing feel responsible for operation, presumption that subsidies or grants will maintenance, and cost-recovery. be provided to sustain or expand levels of services. The imperative to introduce Water and Health cost-recovery is seen only as a plan for the future, not as a necessary strategy for The health implications of poor water meeting current needs. This hesitation in supplies cannot be overlooked. even considering the issue of self- financing overlooks the potential for cost- recovery that has been achieved by Mvula Trust in its recent community initiatives. The shortage of water is serious. While Local authorities are not alone in their the lack of adequate data makes it limited approach to resolving problems of difficult to be precise, it was clear from water shortages. DWAF and its local visits and discussions that few implementing agents act as if they have people are getting even the minimum taken a narrow interpretation of the amount of water recommended for safe potential for community involvement in health. The World Health Organization assigning its priorities for local project recommends 50 l/c/d,4 and RDP selection. There have been few candid standards call for a minimum of 25 l/c/d. discussions at the local level on either the Actual usage is reported to be below this disparity between resources and needs or figure, ranging to lows of 10 l/c/d in the uncertainty of funding for the entire poorly served areas. Fetching water is master plan for water services time-consuming. Women, with some development with implementation phased assistance from their children, are the over 15 years (and yet to be fully primary collectors of water and walk up funded). Up until now, DWAF has to 6 km or more each way. In addition to followed a technically driven policy that the time spent walking, they may wait for has left little opportunity to engage the many hours. commun-ity in the early planning stages, Access is limited and unreliable. While where their needs and interests might be some households have a reliable supply more effectively engaged. Thus of treated and purified water, most do communities continue to believe that not. The majority use communal ongoing projects will very quickly alleviate the problems of water supply. As a result, little thought has been given to 4 meeting the more urgent needs of villages WHO’s “Basic Water Requirements for not included in the first phases of Fundamental Health Needs” suggest drinking water requirements of 5 l/c/d, sanitation requirements of infrastructure develop-ment. Some efforts 20 l/c/d, food preparation requirements of 10 l/c/d, and have been made to engage Mvula Trust in bathing requirements of 15 l/c/d.

22 standpipes with inter-mittent supply from buckets and jerry cans, most of which are the bulk system or bore-hole sources. initially covered but may remain open Some depend on small tankstands filled within the house. Usually drink-ing water with water transported by DWAF, and is set aside in a separate container, but others depend on hand-dug wells or often, as a matter of course, the container nearby dams where possible. As a last used for storing household water may be resort, some people hire a vehicle and used at another time for storing drinking travel to other villages to fetch water. water. Sources for contamination are Overall coverage is not well known, numerous. although available figures (see Section The implications for health are 2.4) suggest that less than half of the obvious. Many people appear to be aware population obtains adequate water from of the relationship between environment either the existing treatment plants or the and disease but are unsure what can be bulk sys-tem. The situation is far more done to mitigate problems They stressed unpredictable in areas dependent on their desire for “purified” and “clean” boreholes where pumps are frequently water in describing their use of bleach to idle due to lack of spare parts, diesel fuel, purify locally collected water. People or basic maintenance, with a large reported enteric diseases, such as chol- number reported broken down and out of era and persistent diarrhea among service. children— diseases associated with Water flow is intermittent and often contaminated water. Incidences of unpredictable, a situation related to the malaria and typhoid (even a few deaths) preva-lence of unauthorized connections have been steadily increasing. People that have disrupted normal distribution. complain about insufficient water to Frequently, women find it necessary to bathe, citing dry skin and skin-related walk from one standpipe to another in diseases. Dirty dishes are often left sitting search of one with run-ning water. At for days, attracting cockroaches and flies. other times, they may sit by a dry connection in anticipation that the water Absence of Ownership or a Sense of may start flowing in a short time. As Responsibility often, they may be forced to wait to fetch water until the early hours of the morning The culture of dependency must be when users at a lower point of changed; people need to feel distribution have turned off their taps, empowered to take responsibility. allowing pressure and flow to build up for communities further along the line. The shortage of water is confounded by dripping faucets and leaking pipes The top-down approach of the apartheid (especially those around unauthorized government in the rural areas instilled connections) resulting in pools of water the role of government as “provider” and collecting around water points. that of communities as “recipients” or Observations showed trash and insects passive beneficiaries to whom services floating in stagnant water with children were given. Little, if any, emphasis was playing nearby. As a further consequence placed on instilling a sense of local of supply problems, water may be poorly capacity at any level, giving rise to stored. To ensure sufficient water, dependency that today is almost women collect water in large plastic ingrained. As a consequence, there is an

23 absence of “ownership” or sense of control, but only on the part of others. responsibility toward maintaining Even local authorities applaud the facilities, even to the extent of simple initiative of citizens in “upgrading” their clean-up campaigns. In local discussions, services through such connections, while many users, local committees, and newly acknowledging that such connections elected officials expressed feelings of may create and exacerbate inequities of hopelessness in resolving problems, their access. comments indicating a continued reliance on “others” to solve problems. Defining New Roles and Structures Complaints were made about boreholes shut down for lack of diesel, but few The transition to new structures is people saw any role for the community in complicated by a lack of clearly defined collecting funds and organizing such roles and responsibilities among purchases. elected officials, civil society, and Instead, individuals pointed to DWAF traditional leaders. as the guilty party and seemed not to take action, even in cases where it was apparent that DWAF was not going to respond as quickly as necessary. There As a consequence of the current appears to be a pervasive “wait-and-see” transition, a complex network of attitude when systems break down, relationships has been created, and local coupled with reluctance to take on roles in information-sharing, decision- responsibility for solutions, even for making, and implementation are unclear. minor problems. Some communities have To some extent, difficulty in defining new been successful in mobilizing support and roles and structures is inevitable in this funds to correct problems, with a few period of rapid transformation to going as far as to seek support from representative government. Structures NGOs such as Mvula Trust and the Leon associated with the former Foundation in resolving their problems. administration, such as the tribal More often, a sense of ownership seems authorities, are frequently dismissed by lacking. those formed under the new democratic This absence of ownership is reflected structure, such as the Transitional Local in general apathy toward checking Council (TLC) and Local Reconstruction vandalism or controlling unauthorized and Development Committee (LRDC). connections. It is also seen in the extent Within the “new guard,” competition has to which individuals apparently feel emerged yet again between those justified in such behaviors. Vandalism of representing elected government (the street pipes and engine theft have TLCs) and those representing civil society continued, long after the transition to (the LRDC), with each claiming to be the representative government and the need “true” voice of the people. The result is a for civil protests has ended. Unauthorized variety of structures that, depending on connections began to appear soon after the area and individuals involved, may be water systems were completed. The relevant for water services development problem has persisted and, based on local and need to be consulted or involved at comments, even increased under the new various points. government. Such connections were The complexity emerges at two levels frequently cited as a problem requiring related to community-based development.

24 The first concerns the existence of local jealousy between the two, especially since water committees. It is not clear within the councillors receive a salary and any of the regions how many water cellphone use and have access to committees exist and in what capacity. transport. These issues are magnified Some existing committees derive from the when there is a project and prospect of old homeland structure and have an funding.5 ambiguous status. Some were established As a consequence of confounding under direction from DWAF. Recently, institutional roles, clear mechanisms and new water committees have been formed channels for user feedback regarding and trained by Mvula Trust and the Leon water supply exist in some communities Foundation to manage newly installed but not all. Inconsistent links between systems. Still other “Project Steering water committees and the ward level Committees” (PSCs) have been formed by structures (the ward councillor and the engineering firm implementing agents WRDC) and the regional structures (the under DWAF-related activities, although LRDC and TLCs) complicate the provision these PSCs have a limited project-specific of services. It also impacts the work of the duration. In other instances, all-purpose private sector and DWAF with water committees have been formed by communities. According to DWAF and Community Reconstruction and consultant engineers, the difficulty Development Committees (CRDCs). In navigating overlapping relationships has some areas, there may be no viable water affected their promotion of community committee structure. In their absence, involvement. Problems cited include the individual members of the CRDC, the lack of continuity in community-based Ward Councillor, or even tribal structures and resistance from some TLC authorities may assume responsibility for officials in empowering PSCs. water issues. They also may not. The second level of complexity Variable Approaches to Community regards the liaison between the LRDCs Involvement and the TLCs. As a consequence of political jostling, awkward and Institutional approaches to community sometimes strained relationships have involvement vary, affecting the extent emerged between the two. The to which local capacity and competition appears to stem in part from empowerment are built and achieved. political ambitions. Many of the new councillors were elected from RDC positions where they were active in development. According to observers, RDP and DWAF policies call for some elected officials have claimed community-based development in the development as their jurisdiction and provision of improved water supplies. bypass the LRDC to work directly with the The objective is for communities to be ward councillor and the Ward Reconstruction and Development Committee (WRDC). In some 5 Because of such bickering among TLCs and LRDCs, the communities, it appears as if RDCs were RDP sponsored a workshop this past August to relaunch “hijacked” by those who lost and are the concept of a partnership between civil society and elected government. Unfortunately, as a consequence of using them now as a platform for the next the then ongoing political unrest, the Bushbuckridge election. In some areas, there is much TLCs were not included.

25 “genuinely involved” and to build local and monitoring of externally provided capacity for ongoing operations and training. However, the CDOs have neither maintenance with full responsibility and the experience, capacity, nor mandate to accountability being taken at the local be as effective as necessary. (There is level. The difficulty in realizing these only one CDO responsible for the BWB aims is caused by the varied approaches service area at the present time). For its to project implementation by those part, the RDP has three subdirectorates agencies and groups involved at the with the mandate to review planning, community level. This affects the extent monitor project implementation, and to which capacity is in fact built and provide community liaison. However, a communities empowered to assume shortage of resources has made it difficult management roles. The content and for these staff to follow through at the quality of such capacity-building varies community level and to ensure the greatly from community to community, capacity-building envisioned. depending on the implementing agency The narrow approaches taken by most involved. engineering firms contrasts sharply with The problem is particularly evident that of the two NGOs, the Mvula Trust among the engineering firms and and the Leon Foundation Water consultants contracted by DWAF to Programme. Both emphasize and try to support the development of PSCs for RDP- ensure broad-based capacity-building. financed water projects. Even though The emphasis these organizations place these firms are required to provide on substantive involvement at all levels capacity-building within their project has apparently led to more plans, training is often limited to short comprehensive capacity-building, interventions in the beginning. Interviews including all levels of management, suggest that this amount of training does technical skills in operation and not provide the skill-building necessary maintenance, and community awareness. for ensuring sustainable management. Further it appears that, in some instances, 3.2 Technical Performance training is not provided at levels promised and may even be eliminated Technical findings fall into several broad completely. Thus in these instances, categories relating to service levels, capacity may not be built and local infrastructure condition, operation and structures undermined by inappropriate maintenance, plans for development, and or misguided interventions. The new transition issues. Build-Operate-Train-Transfer (BOTT) contract is intended to overcome some of Current Service Levels these weaknesses. Both DWAF and RDP have structures Most communities do not have reliable in place intended to monitor and ensure water supply service. Population growth, that such guidelines are followed, but deteriorating equipment performance, neither organization has been as effective poor operation and maintenance in this regard as desired. Within DWAF, practices, and unauthorized connections the Community Development Officer to both the bulk system and to (CDO) is intended to provide support to community reticulation all contribute to the community in the initial organization poor bulk water service. Also, south of of the PSC, assessment of training needs,

26 the Sabie River, bulk water is not systems. Lack of adequately skilled properly treated, although it is maintenance and repair staff compound chlorinated. Water supply is reliable for a efforts to keep borehole water supply small percent of the population living in systems in proper operating order. proximity to water treatment plants. It does not appear that the Bushbuckridge Infrastructure Condition Water Board in its current provisional status, or once formally constituted, will Incomplete information about the bulk be able to provide reliable service to most water system, community distribution communities in the near term. This will systems, and borehole water supplies clearly have an impact on the willingness create another impediment to planning of people to pay for water. for system development and transfer of Water supply for most of the BWB authority to the Water Board and local service area was designed to provide authorities. To date, a full inventory of public standpost supply. Widespread the water supply infrastructure in the unauthorized connections to the bulk BWB service area has not been infrastructure system and to community completed. Although the general layout distribution systems has a significant and many details of bulk water supply impact on overall system performance. infrastructure are known, information Most of the population appear to want regarding many of the community-level individual service provided in the yard or distribution systems is not well in their houses. Water usage varies with documented. This lack of information the level of service provided; households hinders the process of problem-solving connected to the system use three to five and improving service delivery. It also times more water than households hampers the technical analysis necessary obtaining water from standposts. In many to prioritize, specify, and estimate costs areas, particularly near treatment plants, for system rehabilitation and expansion. unauthorized household connections Without a full inventory, it will be have proliferated, which reduces the difficult to transfer assets properly to the amount of water available for users BWB or to local authorities. further along the pipeline network and The poor condition of the overall contributes directly to the unreliability of water supply system will complicate the supply. transfer of assets and responsibility to the Borehole water supplies are also Water Board and local authorities. Even a unreliable; in many areas groundwater cursory examination of much of the water resources are limited, and operation and supply infrastructure reveals significant maintenance (O&M) support is not deficiencies. Bulk meters are not fitted at adequate. In areas of limited groundwater treatment plants, treatment plant resources, low-yield boreholes must be equipment is not properly serviced, equipped to provide at least some water. pipelines leak, valves are broken or in These are often overequipped and poor condition, unauthorized connections therefore overpump the aquifer; at the are poorly executed, and borehole same time, they require more extensive equipment is often out of service. A maintenance. Communications problems survey conducted by Fundile Africa and lack of adequate transportation (1996) indicates that 105 of 115 hinder efforts to provide fuel and communities surveyed (or 91%) had maintenance support to borehole infrastructure problems ranging from

27 vandalized standposts and insufficient standposts) is not likely to be well water storage to leaking pipes and received. Currently much of the priority unauthorized connections. Although work and decision-making for project DWAF is committed to rehabilitation and design and development is defined by upgrade, adequate funding remains a technical and cost considerations as problem. The BWB and local authorities determined by DWAF, and not by social, will likely have to accept assets which are political, or O&M cost considerations. To not in good condition. date, it does not appear that local authorities, who might be able to Operation and Maintenance contribute to this decision-making process, have participated meaningfully Current operation, maintenance, and in long-term planning or project priority- repair programs and practices are not setting exercises. sufficient to maintain the water supply Infrastructure development plans do infrastructure to acceptable standards. not appear to address community desires Although DWAF and others are for household connections. If local responding to immediate O&M needs as authorities eventually have management they understand them and work is control of community distribution continuing as budgets allow, systems and allow or even encourage maintenance and repair programs are not household connections, the planned bulk able to keep up with the required pace. supply network, as currently envisioned, Issues related to management of staff, is not likely to provide the volume and budget allocations, and inadequate flow rates necessary to support water facilities cause significant problems. usage levels. It will be important to plan Poorly trained staff and lack of adequate for system upgrading and expansion in transportation, communication, and the future to allow for such connections. spares are also contributing factors to It will also be important to control infrastructure deterioration. Current unauthorized connections, which maintenance and repair activities are generate no revenue, and to encourage conducted in response to problems in a water conservation through education crisis mode, with no attention paid to and appropriate tariffs. preventive maintenance. Given the current condition of the water supply infrastructure, the capacity Planning for Development and budgets for maintenance and repair, and the likely budgets for capital Local authorities, who will ultimately be improvements, it is clear that the goal of responsible for water supply provision, bulk water supply provision, even at RDP are not adequately involved in the standards, is many years away. For the planning process. Responsibility for water foreseeable future, many areas will have system planning and development is to depend on existing borehole sources largely in the hands of DWAF and the and will not have a reliable piped water consulting community. Although most distribution system. local authorities would likely agree with the goal of providing bulk water to every Transition and Turnover of Assets and community, the government*s decision to Responsibilities fund programs to provide service only to the RDP standard (25 l/c/d from public

28 With the possible exception of Hazyview, Except in a few areas within the BWB personnel in the local authorities do not service area, user fees are not currently have an understanding of the technical collected. To assure the continued, issues related to water supply provision. successful provision of water service to The fundamentals of the hydrologic cycle, all households and businesses in the area, treatment plant capaci-ties, well yields adequate revenues must be generated. If and pumping rates, water con-sumption the revenue from all sources does not levels, the impacts of unauthorized meet long-term spending requirements, connections and system leakage, and the maintenance will drop off, resulting in tech-nical requirements and costs for inadequate service. Increased maintenance and repair of system breakdowns will eventually mean that at components are not well understood. least part of the system will cease to This deficiency puts local authori-ties at a function. Thus, continuity of future water distinct disadvantage in any discussions service depends upon adequate revenues. related to water system technical matters. Equitable distribution of water to all In addition, local authorities do not communities in the area depends upon have the technical capacity to manage water conservation. Even the planned water infrastructure. They do not water treatment and distribution system currently have workshops, offices, may be hard pressed to meet the RDP materials or equipment, transportation, standard of 25 l/c/d throughout the area. communications capability, or staff. Even Water usage well beyond that if DWAF operation and maintenance staff level—estimated here at 100 l/c/d—may are seconded to local authorities along be expected from the growing number of with the available but limited materials households that, in coming years, will and equipment, these local authorities enjoy household or yard connections. appear to lack the skills and experience Moreover, widespread unauthorized necessary to assess problems, decide on connections as well as general system solutions, or direct the work of the leakages will absorb sizable fractions of seconded staff. the total output. Water that is lost through leakage and unauthorized 3.3 The Financial Situation connections is considered unaccounted- for water (UFW) and does not generate DWAF currently operates, maintains, and revenue. General water conservation is repairs all water-related infrastructure, essential, therefore, especially for water but it does not have the capacity to collect to reach sites far away from treatment revenues from system users. Local and supply points. authorities do have the right to assess Fair pricing and accurate billing of user charges and will need to do so when water are needed to assure widespread assets and responsibilities are transferred popular support for a self-sustaining local to them. This section highlights issues water service. In general, people are related to finance and revenue willing to pay for good-quality water generation. service that is fairly priced, with billing based on the quantity of water consumed. Financial Factors Affecting the Transfer to Local Authorities

29 Revenue Collection Most persons interviewed in local authorities and community organizations expressed a strong preference for household or yard connections. Moreover, nearly as many respondents indicated that people are willing to pay for clean water, reliably delivered (presumably approximating 24-hour water availability) to such connections. But a history of free water may make the establishment of fees difficult. The few towns that now have metered water service impose only token tariffs, well below cost-recovery levels. With the clear exception of Hazyview, local residents and businesses will likely be unprepared for the level of charges required to achieve financially self-sustaining operations. With two exceptions, there is no meaningful formal fee system for water service or revenue-generating activity anywhere in the BWB service area. (In a few communities, ad hoc revenue collection reportedly occurs to buy additional fuel for community borehole pumps.) The exceptions are in Hazyview (Ward 1), which has its own locally determined government administration, and four towns—Dwarsloop, Shatale, Thulamahashe, and Mkhuhlu—each of which enjoys the services and facilities of a Province-appointed town manager. Hazyview (Ward 1) and the four towns have metered connections for most of their residential and business customers. In Hazyview, monthly service charges of R30.00, plus significant usage tariffs of R1.40 per kl under normal conditions and upwards of R1.62 under water restrictions, contribute to expenditures in the small-community fiscal environment. In Dwarsloop and Mkhuhlu, and probably in the other two towns, identical charge schedules for metered water have been imposed by the Northern Provincial government. These schedules include

30 both flat-rate monthly service charges (R7 would presumably be seconded to Local per month for residences and R10.75 per Authorities, perhaps for a significant month for businesses) and block-rate period of time, to facilitate the transfer of usage tariffs (R0.20 per kl for the initial water service responsibility to local 50 kl of water, plus R0.30 per kl authorities. Their expertise will be thereafter, less 2 kl). The fairly small essential in management and revenues that are collected from these administration as well as operations and rather modest charge schedules are maintenance, even though their skills are remitted directly into the bank account of limited. In other areas, however, even the the Province. existing DWAF personnel may be of limited assistance to local leaders. For Cost Recovery example, neither DWAF nor any local personnel have appropriate experience in Successful cost recovery in water service financial decision making on such issues provision depends upon identification of as tariff-setting or revenue collection. all costs that must be financed for the Even the establishment of expenditure utility to become self-sustaining. In priorities among types and locations of addition to costs of personnel and projects will require a combination of obvious items such as equipment, energy, technical knowledge and community etc., there are costs that are important for understanding that may go beyond the future operations but which are not experience of any available personnel. visible to local authorities. The wholesale purchase of bulk water is one such cost, Unauthorized Connections which heretofore has been provided free of charge. Other costs, such as Unauthorized connections are rehabilitation of existing facilities and widespread, although no one knows the capital expansion of future facilities, have full extent of the problem. Such also previously been borne by a higher connections are so easily made that even level of government. Moreover, a careful a concerted effort to eliminate them, accounting of the actual O&M absent a more comprehensive approach, requirements of a given water service might well fail. Unless unauthorized organization would likely uncover connections are significantly reduced in numerous staff requirements that local number, they will likely make a mockery authorities might not envision in the first of any meter-based user charge instance. mechanism, undermining any attempts at cost-recovery. Financial Planning and Priority-Setting 3.4 Institutional Structures Since local councillors generally have little or no experience with water service A number of institutional actors are operations, they are not prepared to involved in the water sector and will manage and operate water service affect the process of setting up a program organizations. In the project area, except for local government to take over Hazyview, all formal expenditures for distribution systems. There are three water treatment and distribution are essential levels to consider: the undertaken by DWAF and financed by governmental agencies operating at government. Many DWAF employees

31 national and provincial levels; the local however, have not yet been formally government units (TLCs/TRCs), and the assigned to work with Rand Water and community and civil society level (water are unsure who they report to. Those committees and the LRDC structure). For interviewed indicated that supervision is fuller descriptions of DWAF, local unclear (refer to the management section government, and civil society structures below) . Staff are waiting to be seconded and the policies relating to provision of to the BWB and local authorities and water services, see Appendix D. appear to have little supervision at present. They are described by several Responsibility for Supervision of TLC councillors as “idling.” Operations and Maintenance Strategy for Turnover of Systems The division of responsibilities within the Department of Water Affairs and Forestry While DWAF*s policy is to turn over has changed frequently; this appears to responsibility to local government for confuse local officials, contractors, and water services, it is not clear to anyone DWAF staff. Until April 1997, the DWAF how long this process will take or the Northern Province (DWAF/NP) managed specific mechanisms that will be used to the operations and maintenance of complete it. For infrastructure within schemes in the Bushbuckridge area, while former homeland areas, it is DWAF’s DWAF Mpumalanga (DWAF/M) managed policy to turn over this infrastructure to planning and infrastructure investments. local authorities as soon as feasible DWAF/M also has responsibility for all within the next five years, depending aspects of water supply for the Nsikazi upon demonstrated competency. “Where North and Hazyview areas. In April 1997, capacity and competency already exist O&M responsibilities for the (established local government authority Bushbuckridge area were transferred to with budgets and staff prior to the last the DWAF/M, but monitoring of staff time elections), full ownership can be sheets and administrative responsibility transferred immediately” (DWAF 1997c). for staff still remains the responsibility of It is not at all clear when or how capacity DWAF/NP (managed from its district and competency will be established in the office in Giyani). It is not clear who has Bushbuckridge area so that transfer can responsibility for the O&M budget for take place. Nor is it clear how or when consumables, spares, vehicles, fuel, etc. local authorities will actually take DWAF/NP continues to plan for responsibility for water system infrastructure development in the region, management. especially borehole drilling and Local government officials are unclear refurbishment. about how the secondment process for DWAF/M has named Rand Water to be staff transfer to local government will its implementing agent for O&M in work or about their rights of refusal. It is Bushbuckridge for a two-year period until government policy for DWAF to transfer the BWB is properly established. At the staff that it inherited from homelands time of this study, Rand Water*s business administrations or the prior government plan for O&M had not been approved. arrangements to either local government Presumably the Rand Water O&M or second-tier organizations, such as contract will require the supervision of Water Boards, under secondment DWAF/NP O&M staff; these staff, arrangements. It is not clear how long

32 DWAF must continue to pay for seconded and the ability to identify costs and staff or when water organizations must budget for expenditure. Income generated absorb salary and benefits. “Transfers from water users will need to be must be viable and sustainable and no earmarked for water service provision. interruptions of service at any stage Land titling issues complicate the during the transfer process must occur” potential for viable TLCs in the project (Fundile Africa 1996). Local govern-ment area. Under the old homelands system, units are not required to receive all staff, tribal authorities (e.g., there are five however; seconded staff must be chiefs in the Bushbuckridge area) were qualified for the positions available, and given the land to be held in trust as acceptance requires agreement on both collective property of the people. Chiefs sides. If local government units do not were allowed to apportion it for citizen have positions open, they cannot be use (i.e., people could live on land with forced to receive seconded staff. Presum- the permission of the tribal chief or the ably, the government will be responsible appointed authority, the induna). for the staff who do not find appropriate Individuals living within former placement within the local authority or homelands do not currently hold title to BWB. land, and local governmental structures A related issue is the capacity of the do not yet have the legal capacity to local authority to cover staff salaries and collect land or property taxes (called the ranking process for classification of seizure rights) unless title is held. There these units of government. All local is conflict between the newly developing authorities are ranked, from 1 to 15, TLCs and tribal authorities over who has based upon population and performance. the right to collect taxes. It is believed For example Johannesburg and Pretoria that with the reconstruction process, all would be graded 15. This allows them to laws governing tribal authority were compensate staff at the highest levels. repealed or absorbed within the new Local authorities in the Bushbuckridge constitution, and chiefs were given area range from 1 or 2 to possibly 5. With allowances in compensation. A council of lower pay scales, it will be difficult for chiefs is currently meeting with the these TLCs to attract the qualified staff government to work out ways to deal they need to manage and maintain water with traditional authorities and their service organizations. rights. Resources for transfer have not been provided to local governmental Differing Perceptions about Governance structures, and the prospects for income Authority generation are weak. Very little budget is currently managed by local government The jurisdictional status of Bushbuckridge units, and their capacity for revenue as a part of the Northern Province generation is extremely limited. Budgets continues to create confusion. Interviews for TLCs are provided by central and in the Northern Province District Council provincial authorities through the District and the Ministry of Local Government Council. As civil society structures, LRDCs and Traditional Affairs indicate that until do not get even this limited support. If a final disposition is made assigning local government is to take over political affiliation for the residents of management for any infrastructure or Bushbuckridge to Northern Province or service, it will need sources of funding Mpumalanga, planning and financing

33 projects for the region will be minimal. management capacity. The issues The Provincial Council in Mpumalanga is identified here have implications for reluctant to initiate programs and commit provision of water services by any local resources while there is uncertainty about management system in the future. the future. Local people continue to be unhappy about the lack of government Communication Processes investment in the area, and according to rumors, a resurgence of public protest is Communication processes among TLCs, likely before the end of the year. RDCs, and communities appears The TLC and the LRDC often vie for confusing. Communication among power over decision making. Interviews consultants, the TLC, and civil structures at local levels indicate that in some areas, is also often misunderstood. Messages LRDC representatives resent the more communicated from information sources recently established TLC councillors, who are often unclear or partially understood. receive support and allowances from The chain of information to and from government. LRDC representatives community members, local authorities, currently work as volunteers without project implementing agents, and government support. As a result of the government structures often distorts proportional election process, many of messages so that they are not the councillors were appointed to TLC communicated as intended. In most positions, while other possibly deserving instances, the DWAF project individuals were overlooked. TLC implementing agents lack the skills for councillors now have administrative managing communication and areas of responsibility (for example, as community involvement. Whether water councillor) and believe that they consulting with representative bodies, are empowered to make decisions. Some such as the project steering committees, LRDC representatives believe that they TLCs, LRDC structures, or water themselves continue to represent the will committees, they often do not of the people and should be taken communicate clearly. They are not able to seriously by the TLC councillors. As the communicate ideas and issues in a water service organizations begin to be manner that local participants understand structured, linkages from the community and sometimes seem to believe that via water committees (which also involve telling people information once is village, ward, and LRDC members) need sufficient for information-sharing. Even to be taken into account. when local needs are listened to and acted upon, the follow-up process of 3.5 System Management communicating back to those particular communities and people is often skipped, As mentioned earlier, local authorities so people do not know that their views within the project area (with the are indeed being considered. exception of the Hazyview town area) do not currently manage provision of water Decision Making service. In order to build these services at the local level, the current obstacles need It is not clear who decides about the to be addressed as part of a application and enforcement of RDP transformation program to build water standards for community participation, training, and capacity-building in RDP-

34 funded water supply projects. Although administration of water supply. DWAF requires these elements prior to Leadership in water management in approval of project business plans, no general and within the local authorities one appears to be effectively monitoring specifically needs to be strengthened. and enforcing either the spirit or the Most of those interviewed in local letter of them. DWAF, the consultant, the authorities were unclear about how the PSC, the TLC, the CRDC, and community administration of the water distribution leaders may all have a role, but a clear system should be set up and what kind of mandate to monitor, report on, and O&M structure should be put into place. enforce these implementation measures Because tariffs are rarely collected, there appears lacking. is also little experience with the finance Water system planning, development, and administration of O&M in the TLCs. and management processes are unclear. Hazyview (Ward 1) and portions of Currently DWAF, in consultation with townships where meters are installed relevant consulting engineers, appears to have some experience in this area. There plan and set priorities for water system seems to be an implicit assumption that development. Management of current each TLC will set up a water department infrastructure is nominally done through similar to those in towns in the rest of the Interim Operating Committee, but the South Africa. However, such local process of day-to-day decision-making is departments do not usually have confused. DWAF, TLCs, the RDC, District extensive rural and peri-urban Councils, and communities all believe populations to serve and do not need to they should have a role in all decisions, conduct health education and extensive and some make decisions without public awareness campaigns. They also necessarily consulting together. It is do not usually have to overcome a history difficult to set priorities when full of free provision of water. consultation does not happen and A development strategy needs to be communication processes are confused. created to meet water service needs of the people; local authorities do not have the Planning and Structuring information necessary to develop such a strategy. Meeting needs for water supply Currently the Institutional Development using the large bulk schemes will not be Project (IDP) seems to have no clear realistic for many years to come. Thus, a leadership. A clear vision is needed about short-to-medium-term strategy is called where to go and how to get there. The for. The TLCs do not seem to understand strategic plan that was developed by a this phased planning. Any future capacity- provisional coordinating committee in building for transition will require May 1997 at the Wits Rural Facility seems training for local authorities in strategic to have been forgotten; TLC and RDC thinking and planning. They will also members are unfamiliar with it. As key need engineering advice that they can people have changed in the mix of the IDP trust so they can effectively advocate for coordinating committee, new members the needs of their people with the future have not been informed of the history of bulk supply operator (BWB) and DWAF. decisions. There appears to be a lack of Roles and responsibilities for informed consensus about where to go or management, planning, and decision how to get there to transform making at all levels are not well responsibility from DWAF to local understood or communicated to others.

35 DWAF planners, contractors, Provisional and blaming of others for poor water BWB staff, and O&M personnel make system performance, project planning decisions that TLC councillors now and development, and ineffective believe are theirs to make. Effective communication. Those interviewed often supervision of DWAF O&M staff seems to expressed frustration at working in a be lacking; it is unclear who they work system where they needed to manage for now or will work for in the future. The with insufficient information and LRDC structure, as civil society understanding, while suffering from representatives, may also have a role, but continual complaints on all sides and a in some areas, the LRDC finds itself general lack of support. At the local level struggling with the TLC to assert its voice. there appeared to be a lack of trust in others and a lack of self-confidence to Support for Human Resources manage complicated tasks. In some cases, Development: Capacities and Skills for political squabbles among various groups Management and factions reinforce these problems. A management approach should be The issue of capacity-building for O&M developed that supports risk-taking and staff now working for DWAF is often learning in the process of development. ignored. Many TLC members assume that There is a great need for a more positive staff seconded from DWAF will be able to approach to management of the water perform O&M and repair tasks effectively distribution system. once activities are directed by local authorities. This may not be the case, as the technical skills of this cadre are limited and many are functionally illiterate. In addition, if systems are to operate efficiently in the future, revenues must be generated and managed. Business skills related to billing and collection, budgeting, and accounting will needed at various levels. Management and commercial skills and knowledge will be needed at the local authority and community water committee levels where some management functions could potentially take place. During interviews for this study, the team met up with expressions of negativity, anger,

36 4 SUPPLYCONDITIONS TO LOCAL FOR TRANSFER GOVERNMENT OF WATER

As previously noted, DWAF policy is to distribution is outlined, and the pros and hand over regional bulk water supply cons of various institutional schemes to duly constituted Water Boards arrangements for management are and to hand over operation and described. If the new water service maintenance of community distribution organization6 is to be successful, a systems, borehole schemes, and possibly number of essential conditions will need other water supply and sanitation to be met. infrastructure to local authorities. For local authorities to accept ownership, Autonomy in Operations O&M, and repair responsibility, a range of decisions must be made and conditions The water service organization (WSO) met to ensure sustainable financial and will need to be able to do its day-by-day technical system operations. This chapter O&M job free of interference from discusses the management, financial, politicians and local government technical/engineering, social and employees outside of the organization. consumer, and human resource The water manager must be allowed to development requirements for transition manage, discipline, and reward staff to of water supply responsibilities to local meet performance goals. The government organization must be able to create and manage its own budget. Its accounts must 4.1 Management Requirements be separate from other local government accounts, and the manager must be able Building from the Present to authorize payments. Formal auditing of accounts should be performed by The discussion of management issues in independent counsel, according to Chapter 3 clearly indicates that an regulations. Tariffs must be set by organizational structure to meet agreement with local authorities at rates consumer needs for water service does adequate to meet operational costs. not exist at present. While operators, pipe fitters, distribution networks, and boreholes can be transferred, there is little management capacity to transfer to local government. A rational structure 6 The authors have purposely not indicated must be built, using the current whether the water organization should be called a water equipment, staff, and experience as a department, a local government-owned-and-operated starting point. In Chapter 5 the beginning water supply company, or a water services contract. The framework of a water service selection of options must be made by local authorities. The text uses the term, “water service organization,” organization structure for local which could apply to any of these management designs.

37 Management Processes will need to be read on a regular basis. Bills must be posted and given to Effective management of a WSO includes consumers, or a prepayment system will maximizing the performance of all need to be designed and installed. A employees. Staff should work together as collection structure will need to be a team. Managers and supervisors will developed. Cash must be deposited and need to have the skills to communicate managed to maximize the assets of the well, to run meetings in an orderly organization. Systems for meeting payroll manner, to assign work clearly, and to and other accounts payable will need to provide feedback on staff performance. be structured. The water service manager should know Each work unit of the organization how to delegate tasks to supervisors, who must have clearly defined performance are in turn authorized to make decisions standards, e.g., the time required to to get the job done without waiting for install a meter. The most efficient use of approval. The management team should vehicles and the use of petrol should be define key performance indicators, such defined and monitored. The time required as water loss, income and expenditure, to produce and collect bills should be budgets, billing and collection rates, and tracked. All of these measures, and more, efficiencies in operating pumps and will further the commercial orientation of equipment. Once indicators are defined, the organization. they should be regularly monitored. Management systems will need to be Efficiency and Quality of Performance developed and put in place for such in Operations and Maintenance functions as personnel, accounting, customer accounts, equipment ordering The water organization will need to have and purchase, contacting for services, and cost-saving and cost-management management of equipment and facilities. procedures in place to minimize wastage. It should set service goals so that the time Commercial Orientation required to repair leakage in the system is minimal and the time required to set up a The future water organization must service connection is minimal. An eye to create the financial conditions, through the cost of every item and the cost of tariffs and cost savings, to be self- labor must be continually monitored to sufficient. O&M costs must be met, and minimize excessive expenditures. funds should be set aside for future Performance standards should be set to rehabilitation and capital expansion. monitor the amount of water going into These conditions can be met by managing the system from bulk suppliers and other the water service as if it were a sources and the amount sold to commercial enterprise so that cost customers. Preventive maintenance savings can be realized in all operating routines must be defined for the areas, while maintaining service distribution system and conducted and standards. recorded regularly, i.e., valves regularly A commercially oriented WSO has in exercised, pumps maintained and place a system to bill customers and maintenance logs kept up, distribution collect fees on a regular collection cycle. lines inspected routinely, leaks repaired, Meters will need to be installed where and unauthorized connections identified they are not presently in place, and they and addressed.

38 Consumer Orientation and Relations Human Resources Management

Water service should be provided to The development of the WSO will require customers in sufficient quantity and several years of continuous learning and quality to meet national standards. The growth for the staff and key managers. A WSO must be able to continually expand perspective that values human coverage to meet growing population development will be important to needs. Consumers will need to have a providing excellent services. Staff consistent, reliable mechanism to pay for development and management of human water services, with easy access to resources should aim to provide payment posts so they do not have to opportunities for employees to take risks travel far to pay for bills and are not and to learn new skills. inconvenienced in waiting when paying bills. They must feel that the employees 4.2 Financial Requirements of the WSO are working hard for their benefit and are worthy of their trust. A Cost-recovery through well-priced mechanism needs to be in place to receive metering is the best way to ensure that a and act upon consumer complaints. water utility is financially self-sustaining. The WSO must pay attention to That occurs through fair pricing and consumer demands for level of service, equitable distribution of water to all local consistent with ability to pay, and it communities. International experience needs to develop a regular program to clearly demonstrates that the best way to educate and inform consumers about the conserve water is to impose metered public health aspects of water usage, usage charges that are high enough to sanitation, hygiene, as well as issues cover costs. With this principle in around water loss and conservation. operation, financially self-sustaining water operations are assured. Fairness is Interaction with Key Stakeholders also achieved through cost-recovery pricing schemes that control overall Linkages will be needed for the WSO to demand and substantially discourage coordinate with key collaborating entities both the outright wasting and frivolous and to represent the interests of use of water. Thus, (a) at the consumer consumers in these interactions. For level, each household pays for the example, communication channels with amount of water it consumes, and (b) at the BWB will be important in the community level, water conservation representing the interests of consumers helps to distribute even limited quantities and with the TLC, in technical matters as of water fairly to all communities in the well as cost and price issues. The network. organization’s relationship with DWAF, which will be the major regulatory body Cost-Recovery Tariffs, Charges, and for technical standards, will be important. Fees NGOs will continue to assist communities with borehole and other community Tariffs, charges, and fees should be improvement programs. These linkages established locally, in response to local with other stakeholders must be managed preferences for quality and quantity of and will require time and resources. water service. Locally established tariffs

39 also improve payment compliance, where monthly service charge per household local authorities are accountable for even for unmetered (standpost) water tariffs and fees, rather than a service, as a way to finance the earlier distant, impersonal “government” that introduction of metered connections. might also be an ineffective collector of # Fees for particular services should be water bills. Tariffs and fees must be set at set to cover the costs of actually cost-recovery levels. As noted below, this providing each specified individual price-setting should include provision for service. Connection fees (for rehabilitation of existing service and establishing new house or yard capital expansion for future service, in connections to a stand) are the most addition to covering current O&M common service fees. Although many requirements. communities charge a single flat fee Overall charges for water service may for new connections, differentially include distinct components, such as higher pricing for new connections metered usage tariffs (per kl of water may be recommended in particular consumed), monthly service charges (an situations, such as (a) hard-to-service additional flat charge per month per sites (such as distant, hilly, or hard-to- household customer), and specific service access locations), (b) sites in fees (for new connections, penalties, congested areas, where additional etc.). costs arise (especially business or commercial customers), (c) higher- # Metered usage tariffs (based on volume, or special purpose sites (for amount consumed) can encourage example, where a larger connection conservation by charging higher rates pipe is required to meet a particular for water use beyond a specified industrial need). As with the cost- minimum level. This principle is recovery approach as a whole, higher- presently being applied in the tariff cost users should not be subsidized by structure of the metered towns in lower-cost users—especially if higher- Bushbuckridge, where a slightly cost users are more financially higher rate is imposed for capable than other users. consumption beyond 50 kl per month # Penalties may also be designed to use per household. (The tariffs in these the price incentive to conserve water locations, however, appear to be well by influencing consumer behavior (so- below cost-recovery levels, so these called “demand management”). In rates should not be viewed by local particular, the most effective approach authorities as a guide to future water to the substantial problem of pricing policy.) unauthorized connections may # Flat monthly service charges may be involve use of penalties with imposed in addition to metered usage metering. tariffs. Monthly service charges are commonly used along with metered Water revenues must keep pace with service. They may be set to cover rising expenditures, whether due to some fixed costs of the water system, simple inflation or increasing operational or merely as a supplement to the costs. Regular reviews of water tariffs, variable revenues from metered usage charges, and fees are recommended. If tariffs. If feasible, some communities revenues begin to fall short of spending, might consider imposing a flat the local authorities must protect the

40 financial self-sufficiency of the water rather than the RDP standard of utility by increasing tariffs, charges, and neighborhood standposts (with average fees accordingly. In this regard, formal consumption of 25 l/c/d). annual pricing reviews are essential. During times of high inflation, several Phased Introduction of Metered Stand price increases during any one year may Connections be justified. Metered connections appear to be the Understanding and Monitoring Costs clearly preferred standard for water service in the future Bushbuckridge, Local authorities may not be aware of the Nzikasi North, and Hazyview. The full list of costs for which they will convenience, public health, and standard- eventually be responsible. (Later sections of-living aspects of metered connections of this chapter and Chapter 5 provide are well recognized. The public’s estimated costs for each major willingness to pay the costs for such expenditure category of a local water service is widely attested, though not yet service organization.) In addition to the confirmed. Realistic water tariffs, based usual elements of O&M spending for on the principle of cost recovery, may water service, local WSOs must be fully substantially exceed current expectations. prepared to cover the costs of personnel, Metered connections do, however, offer bulk water purchases, and allowances for the greatest promise of achieving the rehabilitation and future expansion. three objectives of (a) adequate revenues Personnel costs are generally expected to to assure continued operations, (b) water be covered by government subsidies conservation to assure equitable during the early years of the transition. In distribution to all areas, and (c) fair and the long term, however, full costs of all accurate pricing to build popular support staff will have to be borne by the local for a financially self-sustaining local WSOs themselves. Bulk purchase of water water service. will be a major cost component as well. It will take several years to introduce The bill for bulk water purchases will also widespread metered connections into the increase in step with growing volume of area, due to the overall cost involved and water used. Heretofore, bulk water has the sheer volume of physical work been provided free of charge. required. Areas that could move quickly A fully self-reliant WSO regularly sets toward large-scale metering are those aside funds for the future, as allowances advantaged communities with established for (a) rehabilitation and renovation (to local government administration. Indeed, maintain the quality and quantity of the introduction of metered service into service in the existing system) and (b) any individual community will surely be future capital improvement (to expand hastened by the prior accumulation of service). Such a capital allowance is funds to support the attendant costs of especially necessary since local new connections and metering. Perhaps preferences for stand connections may more important, a reliable local supply of generate water supply demands that purified water may be a prerequisite to exceed the RDP standard. This would the introduction of successful local obviously be the case if metered metering. Thus, the geographic coverage connections were widely sought (with of any potential metering scheme could approximate consumption of 100 l/c/d), be significantly constrained, depending

41 upon the extent of present and planned metered and tracked to their delivery water purification in the area. point. Once identified, the offender might In light of potential administrative, then receive a stiff penalty (perhaps financial, and physical constraints to several times the formal connection fee, metering, local authorities will need a with additional penalties for late phased program that introduces metering payment), receive a bill on a regular basis first in those places where it is most likely for the subsequent water usage, and to succeed. The best candidates would be clearly be put on public notice that those communities with relatively further pilferage will not go unpunished. established administrative and financial arrangements, to increase the likelihood 4.3 Technical/Engineering of administrative cooperation and Requirements payment compliance. Early success will quickly be copied elsewhere, but initial Asset Description implementation or financial difficulties could doom the venture from the outset. Decisions and agreements must be reached about specific assets are that will Unauthorized Connections be transferred to local authorities. These agreements must clarify very openly what Unauthorized connections are one of the the responsibilities of the BWB will be, most troubling problems facing the entire and what the local authorities must water distribution effort in the BWB handle themselves. For example, will service area. They drain substantial storage tanks serving communities be amounts of water from all parts of the part of the bulk system or part of the distribution system, and the informal distribution system, and thus under the connection techniques which are used management responsibility of the local worsen the problem through water authorities? This issue must be decided leakage. Although unauthorized and agreed upon for each and every connections seem to be easy and locality. (For example, the storage inexpensive to make, they are extremely reservoir in Acornhoek might be part of difficult to combat. Even a determined the bulk system, while the storage effort by authorities to disconnect them reservoir in Cork might be considered a would likely be defeated by the part of the distribution system.) perpetrators’ reattaching their A complete inventory of infrastructure connections at an early opportunity. assets should be assembled, including Encouraging customer responsibility pipe sizes and locations, valve locations, and putting a system of equitable diesel engine and pump specifications. metering in place might possibly turn the This inventory should include materials, tide. Under this approach, rather than tools, equipment, spare parts inventories attempting to disconnect unauthorized (by item number), and vehicles. All items, connections, the local water service including community distribution organization could embark on a well- systems, borehole pumps, and all other publicized campaign to meter all equipment should be turned over connections (including unauthorized according to a prearranged schedule ones) and identify and heavily penalize (which may be criteria-based rather than the offending households. Selected calendar-based). All asset transfers unauthorized connections could be

42 should be based on a process that of these plans, designs, and records make authorizes certain individuals to act on up the software requirements that allow behalf of local government. for efficient operation and maintenance and permit preventive maintenance Definition of Asset Condition planning.

The asset transfer process should allow Definition of Responsibilities for acceptance or rejection of the transfer based on mutually agreed upon criteria. Although many O&M responsibilities will These criteria should be realistic and be defined by the assets that are acceptable to all parties so that DWAF can transferred, certain responsibilities may plan for and complete any required not be clearly enough defined to ensure rehabilitation or component replacement proper overall system management. For prior to scheduled turnover. For example, example, if local authorities are to be local authorities should not have to responsible in any respect for accept distribution systems with broken unauthorized connections to bulk lines, valves or diesel pumpsets which require these responsibilities must be clearly immediate repairs. Likewise DWAF should defined and agreed upon. Similarly if know what constitutes an acceptable local authorities are to be responsible for asset condition. A mutually agreeable the security of assets of the Water Board process for inspection of assets at such as pipelines, pump stations, or transfer should be decided. regional storage reservoirs that may lie A particularly difficult point of within community boundaries, this must discussion may be the rationalization of be properly spelled out. At some point, unauthorized connections within the allocation of responsibilities within community distribution systems. A logical local authorities—for example, among the program would probably involve both TLCs, CRDCs, and water committees—will DWAF and local authorities to manage need to be clarified. this especially tricky situation. Existing O&M Staff Information Requirements It is clearly the intention of DWAF to In addition to receiving physical assets in second (and eventually transfer) staff operating condition, local authorities currently performing O&M duties to the should also receive all O&M manuals, all BWB and local authorities. Local past O&M records, and all current authorities should have the opportunity guarantees, warrantees, and in-force to evaluate all available staff and service contracts. Of particular participate equitably in the selection importance is transfer of all design and process so that the BWB and each local as-built drawings, construction records, authority can share the limited skills names of contractors employed, etc. for available within this pool. A fair process distribution systems that local authorities of staff selection from this pool should must manage. This information should also allow local authorities to reject also include borehole specifications particular staff due to lack of requisite including depth, casing material, static skills, unwillingness to perform assigned water level, yield, and drawdown functions, or any other rational and information as well as pump setting. All acceptable reason.

43 In addition to employing the existing local authorities should have the best O&M staff, local authorities should available information regarding water consider and develop a process for supply needs and community priorities. recruiting personnel with skills not found Local authorities and their WSOs should within the available staff pool. This participate in long-term infrastructure recruitment process calls for outlining job planning at an early stage. Although this descriptions and requirements for planning process may be led by others employment for each staff position. The (most likely DWAF), it is critically skills that will not be found within the important that local authorities existing O&M cadre include bookkeeping, participate and know that their concerns financial management, education and and priorities for development are heard. training, and possibly mechanical and pipefitting skills. Future Infrastructure Development

Current Facility and Equipment Prior to transfer of assets and Requirements responsibilities, a clear policy regarding financial and technical responsibilities for At present, local authorities have no future infrastructure development should office space, office equipment workshop be agreed to. This includes decisions facilities, equipment, or communications concerning what is considered to be capability. Local authorities will have to infrastructure development and who will reach agreement with DWAF and/or finance and manage it. Of particular others to ensure that necessary facilities importance in this definition will be are made available or that access to them current and future rehabilitation is assured, Local authorities will not be programs, which might be considered able to take on O&M responsibilities “system repair.” Initial establishment of without at least some basic facilities from metered household or yard-tap which to work. connections within a community, which Local authorities will also need to could require significant capital have certain essential equipment, such as expenditure, should also be discussed pipe cutters and threaders, tripods and within the context of future infrastructure lifting equipment to pull pumps from development. boreholes, and most especially appropriate vehicles in working 4.4 Social and Consumer condition. Some of this equipment may Requirements be transferred as part of the turnover of existing assets. However, this may not Consumer Awareness and Rights always be the case, and provisions for local authorities to obtain the necessary Transfer of water supply from central to equipment must be a part of the transfer local authorities implies profound program. changes in the way people currently receive water. Residents in the study area Long-Term Infrastructure Planning have become accustomed to dependent, passive relationships where water is free. Since all future water supply They will have new rights and infrastructure development within a local responsibilities as paying consumers authority area will have O&M impacts,

44 under the new structure, roles that are efforts and cooperation among unfamiliar and not clearly understood. councillors, RDCs, and tribal authorities Local authorities must ensure to mobilize local support in containing transparency and move quickly to build the problem. Users must accept their trust and confidence between the responsibilities as consumers to protect providers of water services and the the water system against misuse, consumers they serve. This will require a vandalism, and unauthorized communication strategy to create connections. Such education should be an awareness of new policies, consumer immediate priority and should attempt to rights to effective service, and the involve users in identifying ways more responsibilities of paying customers. A equitable distribution can be achieved, necessary first step is building even within the current malfunctioning commitment among RDCs, tribal system. For example, there may be ways authorities, and councillors to a to rationalize water use in home gardens commercial orientation and or agriculture activities right away, even understanding of financial viability and before the system is normalized. Such a then to organizing community or ward program should also look into water education campaigns. conservation and loss prevention. Effective and reliable mechanisms for At the same time, regular programs communication and feedback will need to should be set in place regarding the be established at the community level, public health aspects of water usage and either through water committees or other sanitation. Local authorities should insist channels, and within the water that health and hygiene education, along organization structure(s). Management with behavior change goals, are included will need to ensure that commitment to in the design of all water projects. More service is conveyed and enforced at all information is needed regarding staff levels. A customer orientation may community knowledge, attitudes, and be new to staff, especially those practices as well as residents’ willingness transferred from DWAF. They may not and ability to pay. Initially, this fully understand the role that users or information-gathering might take the consumers can play in improving the form of a baseline data survey. Later, as effectiveness of services. In community- the water system matures, such managed services, water committees will information collection could become the need to ensure that committee members basis for strategic planning on expansion understand and fulfill their roles. This or the design of marketing activities. As a includes administering, managing, and management system is set in place, staff monitoring the system operation and must understand and be able to use such consultation with other community information in guiding decisions members. In all instances, committee regarding service levels. Accurate members or organization staff must be information regarding population is clearly identified to the community. critical. Women, as the primary users, Education and Behavior Change collectors, and managers of household water, have a central role to play at the Educational campaigns must be launched community level. There should be clear regarding unauthorized connections. This commitment on the part of all sensitive topic will require coordinated stakeholder organizations to promote the

45 appropriate involvement of women and # Essential communication skills: How to facilitate their effective participation. can managers communicate clearly in This includes management roles within spoken and written word and present community-based water committees, ideas clearly to others? outreach in educational campaigns, and # Giving and receiving feedback: What delivery of health and hygiene education. are successful and effective ways to give and receive information about Structure for Community Participation performance? and Management # Conducting meetings: How should meetings be managed to achieve Effective and representative community follow-up and results in a minimum structures are necessary to implement amount of time? consumer campaigns, negotiate # Working with staff to achieve results, distribution and service issues at the human motivation: How can the community level, and, in some instances, manager and supervisor get the most manage community-based facilities. Local out of people? authorities must ensure that such # Organizing work with staff and structures are in place, functioning, and delegation, situational leadership: responsive to local users. Clear roles and How does a manager select the right responsibilities must be identified and person for the task and ensure that he negotiated and mechanisms established or she receives the coaching and help for coordination and management with needed to do the job? What the water service organization. management techniques help motivate people to get the job done, when they know how to do it? 4.5 Human Resource Development # Requirements Defining performance standards and the performance management process: How should managers define Training for Managers work performance measures and monitor them? Development of the WSO will require a # Using management information to different type of management from what monitor performance: What has been traditionally provided by techniques should managers use to government. Managers and supervisors, analyze data on financial, technical, board members, and local authorities will and work performance and use them need to learn how to operate a to improve productivity? commercially-oriented enterprise # Planning strategies and planning dedicated to consumer service. This will processes: What are the steps to require management training during the developing a work plan, a strategic transition from the present configuration plan, and a performance improvement to a fully functioning WSO. The following plan? list illustrates essential knowledge and # Leadership: How can managers and skills that are required: supervisors provide a model for others to follow and lead others in # The role of the manager: How is a ways that inspire trust and manager different from a technician? confidence?

46 Technical Training monitor water-related needs, promote responsible water usage, and ensure that It is clear that many of the existing O&M public health requirements are met. Such staff, who are available for secondment outreach and community training may be and eventual transfer to local authorities, done through the RDC, water committees, are not highly skilled or literate. If local or other arrangements. Where authorities are to take responsibility for communities are responsible for local providing water supply service, it is system management, water committees important that the technical staff have must have the capacity to take full adequate skills to do their jobs. responsibility for operation and Therefore, local authorities should have maintenance, tariff or levy collection, at their disposal technical training system administration, and coordination programs that allow skill improvement with the water service organization if for the staff under their management. necessary. Programs or opportunities for These training programs should be such training should be identified, available and open not only for current organized, and made available to the staff who are likely to be seconded, but appropriate individuals. also for staff that the local authorities may choose to employ after transfer of services.

Local Capacity-Building

Steps must be taken to ensure that communities have the capacity to mobilize and educate users on their rights and responsibilities as consumers, identify and

47 5 MANAGEMENTOPTIONS FOR WATER SUPPLY

In the future, when the assets and Local authorities might select one of responsibility for provision of water the proposed water supply governance supply service are transferred, each local structures as they move forward in authority must have in place an establishing such organization prepared to provide operation and maintenance of a water system as described in Chapter 4. For the most part, local governments will be building a water service function from the ground up; to arrive at the desired end (a self-sustaining, community-wide system), time and a transition process with assistance will be required. The strategy for this will inevitably be a step-by-step process. Chapter 6 describes a recommended program structure for such a transition. The full picture of how the future might appear some years hence is presented here. This chapter describes different options for management of the water distribution services, and provides an illustration of the structure of a model water organization. The model described could operate either as a water department in a typical town or township (appropriately linked to community water committees), or it could operate as a municipal company (completely owned by the local government). The model water organization could also be operated in the form of a contract. Each of these options is described. The way that the water organization is controlled by the local government is referred to as “the governance structure,” which should not be confused with national or local authority governance.

48 organizations. Criteria for selecting the most appropriate form are described in Section 5.1; Section 5.2 gives definitions of three governance options and their strengths and weaknesses. The three models discussed are local administration (a water department), municipal corporation (public-public partnership), and contract operations and maintenance (public-private partnership). The privatization model is not discussed and is not considered viable under current conditions. The functions of a well-managed WSO are presented in Section 5.3, followed by an illustrative organizational structure in Section 5.4. In the final section, a cost scenario is presented for the hypothetical water organization.

5.1 Criteria for Selecting a Governance Structure

The structure for water supply governance is the primary and fundamental decision local authorities must make in developing a financially sustainable, well-run WSO. This structure will determine how services are delivered, reporting relationships for the manager of the WSO, and processes for decision- making regarding policies, growth, profitability, and service levels. It will also determine the relationships with civil society structures (i.e., LRDC, CRDC, water committee), political structures (the local authority) and the internal structure itself (see Figure 3). Any governance structure chosen

49 Figure 3 Relationships between the Water Service Organization and Other Governmental Structures

50 will need to have a water organization questions must be faced. Should the that can provide the services described water organization be allowed to be a below in Section 5.4; its organizational source of political patronage, or should it structure will look more or less like be a professional organization? How will Figure 4 in that section.7 the civil society structure and the local The water manager should be authority relate to the water services responsible for the day-to-day operations structure? How will relationships with and supervise staff. He should be an community-based water committees be employee, not a publicly elected official, structured? as it would be a conflict of interest if any As mentioned in Chapter 4, certain one of the councillors were also the criteria should be considered in manager of the WSO. The manager needs structuring and managing the WSO. to be held accountable for his or her These characteristics have been derived performance and for the performance of from studies that EHP has conducted the water organization. The governance comparing successful water organizations structure must be able to appoint and around the world. dismiss the water manager. In defining this governance structure, Operational Autonomy: Ability to a number of questions will need to be Manage without Interference in Daily addressed: What type of WSO should be Decisions built? Should it be a water department with municipal staff hired (or seconded) A water service organization needs to be to operate it? Or should it be structured able to respond quickly and effectively to to perform as if it were a municipal consumer requests without being pulled business with the staff as employees of a in several directions at once or needing to municipal water company? Alternatively, check with the local authority for should the local authority hire a decisions. It needs to be able to consider contractor to manage the water service all of its customers in making those and not take on the responsibility for the decisions, not only a chosen few who staff that the government wants it to have the right influence. Services will be absorb? What are the political compromised if the manager has to considerations in each of these ways of answer to 15 bosses, all of whom are governing? With the scarcity of powerful elected or appointed officials. employment in the project area, other The water manager should not have his priorities reshuffled by higher authority, for example, every time someone with influence wants a water connection. The 7 It should be made clear that each local government unit now has or will have a municipal staff, staff need to be able to perform their jobs such as a town manager and employees, to deal with a as professionals, not as servants of the series of municipal functions. The town employees are politicians and vocal community governed by a town council (the political dimension) members. The governance structure and directly supervised (usually) by a town or city should minimize interference and manager (the municipal function). Currently the town maximize operational autonomy. council is termed the “Transition Local Council,” but eventually this will be called a local council. The town Responsiveness to Consumers and council is elected. Municipal employees are appointed. One cannot be an elected official and a municipal Ability to Link with Existing Community employee at the same time. Structures

51 The governance structure needs to allow develop where the WSO can serve for coordination with and possibly consumers more effectively by merging integration of community water with neighboring local authorities, the committees. Such community-based governance structure should not prohibit structures provide the logical link through this possibility. which services can be coordinated and even possibly managed. During the Ability to Manage Staff beginning years of the water organization, close coordination will be For the WSO to operate cost effectively, particularly important in addressing employees must be held accountable for sensitive issues surrounding results. No one, at any level, should be unauthorized connections, payment of allowed to hide behind a lifetime services, conservation, and equitable guarantee of employment, with no regard distribution of scarce resources. to performance. In the current situation, Committees can be channels for local WSOs will be absorbing civil service consumer education or awareness employees seconded from other campaigns. Committees may also need to government agencies. An essential assume responsibility for the ingredient of autonomy will be the ability management responsibilities of small to hire and dismiss staff and hold them systems such as boreholes. Eventually, accountable for results. WSOs and local such structures could, in many cases, authorities need to avoid the situation become a part of the water service found in many other parts of the world organization or work as affiliated where rules for seniority, promotion, and members. other measures not related to performance have strangled the Efficiency: Capacity to Achieve effectiveness of daily management. Economies of Scale and Operate At the same time, local authorities Economically must ensure that sound personnel policies are set in place within the WSO The WSO needs to have flexibility and to protect employee rights and guard capacity to save on expenditures where it against unfair hiring practices by political can, and not be burdened with forces and others who may have power bureaucratic requirements that take more for short periods. If the WSO is a creature time and cost more money than of political whim, the staff will change necessary. It needs to be able to purchase with each administration, continuity will equipment as quickly and economically as be lost, and training expenditures wasted. possible without going through multiple levels of red tape. It needs to have the Flexibility to Meet Growth financial resources to purchase in bulk Requirements and save through economies of scale. The service area of the BWB will become Capacity to Grow and Transform increasingly complex, and the population will grow. Issues of long-range planning The WSO needs to be able to join with are important to the future. The WSO will other water providing organizations in need to have access to good staff for the area where unnecessary duplication planning, either though contractual or overlap exists. Should future situations services or with core employees. Some

52 degree of technical capacity will be (and most small towns around the required to balance the power of local world). In this design, management of all government against the monopoly power municipal functions such as water are of the bulk water supplier that will sell combined under village governance. A water to retail WSOs. The organizations technical services manager may provide will need to be able to reorganize supervision for water, streets, and all periodically, to develop efficiencies municipal infrastructure as one through setting up network teamwork department. The town clerk may serve as approaches and to grow. the billing and collection locus: bills may be paid directly at the town hall, sent as Ability to Manage a Self-Contained checks by mail, or in some instances, Budget collected through agents such as the local post office or a local store. Income from As mentioned earlier, the budget and the water services becomes part of the income of the WSO must be maintained municipal budget. The mixed separately from the accounts of the local administration model serves small authority. There will not be enough populations reasonably well, especially income from water service to support towns that do not need to manage a other municipal functions. The WSO is, by sewage treatment system, which is more nature and design, a nonprofit public complex than a water treatment plant. service; any surplus generated should be As villages grow into towns, more used to improve service, to provide staff are added but reporting incentives for improved staff relationships often remain unchanged. performance, and to expand service. The The direct budgeting and financial initial years of the organization will relationship remains in place as the require subsidy. village grows, and any excess income from one service is used to fund other 5.2 Options for Governance town functions. The infrastructure, or Structures water manager, reports to the town manager. Technical staff report to the water manager, and the other service Governance determines who controls the functions (consumer, billing, etc.) report WSO and how it relates to its external directly to the town manager, who stakeholders. There are three basic essentially serves as executive director of models that could be viable under current all departments. conditions in the project area. A variation on the mixed administration model is the separate or 5.2.1 The Direct (Local) self-contained water department. This Administration Model version is typically seen in villages which have grown sufficiently large to justify The direct or local administration model hiring a water manager with the sole has two versions: (1) the mixed responsibility of managing the water administration structure and (2) the self- organization staff. All water staff and contained water department. The mixed departments that appear in Figure 4 administration structure is the version (found in Section 5.4) would report to the followed by Hazyview and most small, water manager. The water manager traditionally white, towns in South Africa would report directly to the (elected)

53 town council and not to the town revenues” rather than water service manager. Water accounts and funds are revenues and are often mixed in a separated, and in effect a small water common account. As personnel serve company is managed within the town multiple municipal functions, it structure. becomes difficult for the manager to know where funds are being spent. Strengths of the Local Administration # In the mixed administration model, Model the water manager does not have direct control over all staff working in # The model is simple to administer and the water area, making it difficult to works well for small populations. monitor performance by achievement There are many examples of this of results. model in South Africa, and people are # As the public image of government- familiar with it. run services is often poor, consumers # In the mixed-services version, may be reluctant to trust political economies may exist in the delivery of management and desire professional different services by the same management. department or individual. For # As civil service employees, staff have example, the town clerk may collect little incentive to perform their work for water and other services at the efficiently because they are assured of same time. civil service protection. Whether they # Managerial control rests with the work hard or little, they are paid the town manager (in the mixed same. Further, because of administration model) and is not requirements for grading levels for divided among a cadre of department public servant, staff pay cannot be heads. Scarce and more costly based upon performance. managerial skills rest with one # Staffing and promotions are usually person, thus administration budgets by seniority rather than by are lower, compared to other models. performance. # Consumers can place all responsibility # The staff who will be seconded to a on one body, essentially the town WSO or local authority will be its manager or town council, for service responsibility for all of their working and complaints. lives. # Town priorities for new investments # The direct administration model may be easier to set since levels of becomes increasingly inefficient when review in lower departments are not dealing with populations over 10,000, required. because it is designed to operate as a # Councillors become familiar with the public service rather than a business. business aspects of water # The water department will not be management. likely to have a dedicated utility budget, unless special measures are Weaknesses of the Local Administration taken to that end. Model # The town manager or mayor must approve all expenditures, although # In this model, it is difficult to link usually lacking any training in water tariffs with service delivery. All management. The result is often revenues are considered “town delays and energy spent convincing or

54 educating him about water service Assets are owned by the local authority, functions. and the WSO operates on its behalf to # The concept of a self-contained utility meet the public service policy goals is often lost in this model. A self- required through its charter. For example contained utility is a business unit. In the charter could require “24 hours of the direct administration model, the service per day to all consumers who pay water department is not generally at the most cost-effective tariff.” The viewed as an enterprise; the only one water manager is appointed by the board who may consider it such is the mayor and serves at its pleasure. He can be or the city manager. dismissed, rewarded, or given incentives based upon performance. The staff may 5.2.2 The Municipal Company also have these conditions within the Model established bylaws.

The municipal WSO is set up with a Strengths of the Municipal Company governance structure much like a Model corporation or business, but all assets are # owned by the local authority. The WSO is The WSO is protected from daily governed by a board of directors that interference in its management supervises the water manager. Employees processes by the bylaws governing the are hired under the statutes regulating public corporation and by the board, public sector companies or public which serves as a mediator between corporations. They work for the the political powers and the WSO municipal water company rather than the management. # local government authority. This model is Civil society structures can be directly sometimes referred to as one form of represented in the governance by “public-public” partnership (others might inclusion on the board of directors. include contracting with other public Broad representation of the public can organizations for services).8 The company be structured into the board has a corporate charter that governs its governance as well. # functions and its employees. It has its Legally the municipal company can be own set of personnel policies and its own structured to have all the latitude internal regulations. The membership of necessary to operate as an the board of directors is dictated by the incorporated economic unit: ability to local authority, which decides within the contract for services, board bylaws of the company charter who participation, flexible structure with should serve and the term of service.9 checks and balances for management, and capacity to enter into financing

8 Rand Water or the Northern Lapele Water Board is an example of a public sector company for bulk water supply. could be the mayor, or could be elected among the members. The board meets periodically (from four 9 For example, the board could contain four times a year to once a month, depending on needs). councillors, three Water Committee members, three The water manager presents the results of the work, LRDC representatives, two local business people, one reports on financial matters and strategic plans, requests Engineer from DWAF, one teacher/professor from a for policy, etc. The board approves or denies and local school or university. The chair heading the board instructs the water management to implement.

55 arrangements with national and # Economies of scale are possible under international sources. this model. The company may join # Ownership is protected; the local with others like it to increase the size authority maintains ownership and of the service delivery area consistent the public trust is provided for. with agreements with other local # Administrative and management authority-owned companies. procedures can be formulated by the # Public sector companies can be company itself. It can delegate authorized to borrow from the private functions within the ranks from the sector to finance water and water manager on down. It can wastewater systems; however, modify the management structure or companies are only able to borrow if decentralize as required. they are credit-worthy, which means # Financial affairs such as tariffs can be tariffs must be high enough to cover formulated by the municipal company O&M and capital costs. with the approval of the board and the local council. Budgets can be Weaknesses of the Municipal Company developed by staff and approved by Model the board; revenues can be retained to cover operating costs. Financing for # The model is unfamiliar to many capital costs can come from a variety people in the project area, and of sources. managers and councillors would need # In this model, tariffs and service to learn how it works. Many might be delivery are linked; the public service surprised that any model other than company retains the revenue collected the direct service water department is and has responsibility for budgeting conceivable. Initial attitudes may be and accounting for operations and that a municipal company will be “far maintenance. Linking revenues and away from the people,” when it will, expenditures provides an incentive to in reality, be no further removed than operate more efficiently. any other municipal service. # Personnel may be engaged or Councillors who want to control the dismissed within regulations water service directly may feel at a established by the company. disadvantage, having to work though Remuneration may take a variety of a board of directors to receive forms, including bonuses and attention. incentive pay. Any seconded staff # The perspective of a municipal would need to transfer to the water company is business oriented and company’s roster and be governed by people are accustomed to thinking of its personnel regulations. the water company as the provider of # The organizational culture of a a social service rather than as a company differs greatly from a community enterprise. The change in government department. A company thinking required will need time and is an economic unit that must operate education. cost-effectively while serving its # It will take a three-to-five year customers. The employees’ sense of education and training period for staff identity and loyalty can be very strong to learn to work as a team in a and positive if the company is well business-like structure. Staff training managed. will be required and outside technical

56 assistance will be needed, with (garbage collection, typing services, financing from donor organizations or making copies, etc.). Privatization is a the central government (DWAF). model that is not discussed here; it involves selling or leasing all the assets of 5.2.3 The Contract Model the infrastructure to a “for profit” company that operates as a regulated Contract management by a private private utility. company is permitted under the water services White Paper and proposed laws. Strengths of the Contract Model It provides for the delegated local # authority (as the water supply authority) Competition in selecting a designated to appoint a water service provider (WSP) operator gives the local authority the as an agent to operate and maintain the advantage of obtaining services at the infrastructure and to bill and collect lowest bid that is credible . # tariffs on its behalf. The local authority The private sector is often far more may even appoint a water committee, or efficient than the public sector, and any other legally constituted entity that this can be reflected in lower tariffs has the capacity to provide the services, for the consumer. # to act as a WSP on its behalf. In the If the contracting firm does not contract model, the assets of the water perform, it can easily be dismissed service (pipes, equipment, infrastructure) and replaced by another that is willing remain the property of the local authority, to do the job. # and the WSP is required by contract to A private contractor can formulate its maintain them. The local authority may own management procedures also require that the WSP provide certain unencumbered by red tape and can equipment, such as vehicles and office delegate from its director down equipment, under the terms of the through the ranks. It can set contract. The contractor is responsible for performance standards for its staff retaining, dismissing, and remunerating and more easily discipline and reward all staff, or certain staff may be good performance. # designated as employees of the local Incentives for good performance can authority who are seconded to the be built into the contract to stimulate management control of the WSP or higher levels of performance and contractor. The terms of the contract may greater consumer satisfaction. # specify that all collected tariffs remain the The contractor can be required to property of the local authority and are provide regular communication with directly turned over to it for its own community and civil society structures accounting purposes, or they may charge and serve the public interest within the contractor with maintaining an the terms of reference. # auditable financial management function Tariffs are totally regulated by the for the authority in trust. This model is local authority. sometimes referred to as a “public-private partnership.” It is often confused with the Weaknesses of the Contract Model term “privatization,” which it is not. Use # of the private sector to perform work The communication linkage between contracted by local government has often the local authority and the WSP is occurred for a variety of functions managed by the town manager and/or

57 the water councillor. In this linkage response to complaints and long-term there is ample room for corruption. system requirements Communication difficulties can arise # Planning and coordinating with DWAF if the water councillor or town and community structures for system manager does not clearly upgrading and expansion communicate with other councillors # Maintaining water distribution or the executive committee of the systems in communities by repairing local government. leaks, replacing broken valves, # Under this model, it may be easier to cleaning water storage reservoirs, etc. avoid interaction with civil structures # Maintaining borehole water supplies and community water committees in communities not adequately served unless clear linkages are structured. by the bulk water supply system by # Supervision and oversight of the ensuring fuel availability, repairing or contractor requires skills and replacing pumps as necessary, knowledge within the local authority maintaining and repairing engines on the same level as the contractor. and electric motors when necessary, Training in contract management will etc. be required for the linkage supervisor # Controlling unauthorized connections from the local authority. by disconnecting or metering # Attitudes towards private sector # Contracting for services (such as management may be negative, and engine overhaul, motor rewinding, councillors may feel that this model and perhaps vehicle repair) which are does not allow local people to learn beyond the capability and capacity of how to do the work, unless the the water supply organization contractor is required within the # Establishing metered connections in terms of reference to hire a certain areas where this is practical and percentage of local staff. desired # The local authority and the public are # Purchasing, maintaining and unfamiliar with this way of controlling an adequate stock of spare conducting public services, and a parts for system maintenance and period of learning and adjustment repair would be required on both sides to be # Reading meters (and repairing or able to learn to work with it. replacing them as necessary) to enable accurate water billing # 5.3 Functions of a Water Service Collecting revenues from customers Organization so that bulk water can be purchased and maintenance and repair can be assured This section describes a possible future # Managing transportation so that the water organization structure. This new functions of the water supply organization will need to be able to organization can be efficiently carried undertake a range of tasks and services: out # Managing and paying water # Receiving complaints from water organization staff system customers # Conducting awareness campaigns # Planning and prioritizing the activities related to the need for payment for of the water organization staff in water service, control of unauthorized

58 connections, water conservation, and # Some customers are willing to pay hygienic use of water and do pay for water. # Managing and controlling payment for # Borehole water supplies are managed bulk water, materials, spares, and maintained by local government. equipment, and for other required # Capital improvements are largely services. implemented by DWAF and other outside agencies. # 5.4 Illustrative Water Supply The organization and staffing levels Management Organization are illustrative of the end of the transition process. # The organization will primarily serve Assumptions domestic consumers because there are very few industry or business clients In order to give an example of a water in the service area. supply management organization, certain assumptions must be made regarding Structure area and population to be served and the types of water supply infrastructure The overall structure of the illustrative involved. Although the characteristics of water supply organization is shown in five local government areas are different, Figure 4. The structure provides for a certain similarities exist that allow the manager with day-to-day responsibility development of an illustrative case and for provision of water supply services. can inform the decision making process The manager is supported by a director in each local government area. The for operation and maintenance assumptions do not correspond exactly to responsible for field maintenance and any one of the local areas, but are repair of infrastructure, a director of representative of the situation in all. The consumer affairs responsible for contact assumptions used are as follows: and communications with water system end-users, and a director for finance and # Total population is 300,000, in 37,500 administration responsible for financial households. control and administrative matters. A # The local government area is divided total staff complement of nearly 200 is into six wards. assumed. # The local government area consists of The O&M section includes a central 35 communities. workshop (staffed by skilled artisans) and # Twenty communities are connected to stores facility (staffed by a procurement the bulk supply (three are served officer and storekeepers). A borehole reliably 24 hours per day). O&M subsection consists of 60 operators # There are 168 boreholes (120 diesel- for 120 diesel-pumpsets, and five crews pumpsets, 45 handpumps, and 3 responsible for fuel delivery, electric pumps) which also provide maintenance, and repair. A distribution water to customers. system subsection includes five crews # Initial average water consumption dedicated to distribution system area-wide is at RDP standards (25 maintenance and repair, and five crews l/c/d). dedicated to service connections (new # Some percentage of the customers metering, disconnection for nonpayment, have metered connections. etc.).

59 The consumer affairs section is staffed Figure 4 at the local government level by a Structure of a Water Service revenue Organization

60 officer, revenue clerks, and meter readers who manage billings and collection and a consumer affairs officer who manages ward-level operations. Ward-level operations include community awareness and education, complaints, and payment. The finance and administration section manages overall finance including income from collections and payments for staff, materials and equipment, bulk water, and all other expenditures necessary for O&M management. Administration includes personnel and training, security, and general record- keeping for the WSO. This is only an illustrative structure. For particular local government areas, staffing levels may vary depending on the particulars of the infrastructure to be managed, the population to be served, the levels of service provided, and perhaps most importantly the availability of revenue to cover costs.

Primary Functions and Tasks

Key to the functioning of the structure as outlined are the ward-level offices in the consumer affairs section. It is here that complaints about breakdowns, leaks, and requests for house connections are received. It is here that payment for service is made. And it is at this level that community outreach campaigns so critical to consumer awareness are managed and conducted. Billing and collection functions are also managed by the consumer affairs section. In the illustrative example, meter readers will read household meters on a monthly basis. (The example assumes four meter readers, but as more metered household connections are made, more meter readers may be necessary.) Manual or computerized records are kept in this section as well.

61 As complaints and requests are schedule maintenance and repair work. received, these are passed to the O&M The proposed staffing levels for borehole section which must prioritize activities, operations and distribution systems will plan around transportation needs and depend on the exact mix of borehole and limitations, and bulk supply infrastructure. In some areas five crews will be more than sufficient, and in others, this may not be enough. The skills and efficiency of these crews will also vary and must be taken into account in managing the work load. A central workshop has been assumed to house tools and equipment for more extensive repairs that cannot be completed in the field. A more skilled mechanic and an electrical technician should be available for workshop repairs and to assist in more complex field maintenance and repair. Some repairs, such as machine work and electric motor rewinding, must be contracted out as these are specialized tasks, beyond the capacity of staff and equipment needed for a normal level of operations. A procurement office and storekeepers to manage and maintain tools, equipment, materials, and spare parts are assumed to be a part of the O&M section, although they could as easily be part of the responsibility of the finance and administration section. Revenues collected by the ward-level payment clerks are registered by the billing and collections subsection to ensure proper customer accounting and then passed to the finance subsection of finance and administration. It is here that all budgeting and accounts are managed and reconciled. This subsection should also be responsible for budgeting and tracking budgets in order to ensure that expenses do not outstrip income. This subsection should be responsible for all payments made on behalf of the water management organization. The administration subsection should manage staffing issues including personnel records, disciplinary actions, training, etc.

62 This subsection should handle other 5.5 Illustrative Cost Structure miscellaneous matters such as security, administrative record-keeping, and the An illustrative expenditure budget of the like. hypothetical WSO was constructed as a guide to local authorities for future The manager of the WSO should take planning. Fully staffed and providing the lead in planning and coordinating water to a hypothetical population of with outside agencies such as DWAF, the 300,000, total annual expenditure of this Mvula Trust, and others. He should WSO is estimated at R15.325 million. The provide overall leadership and guidance detailed budget is found in Appendix E. A in the management of the organization. summary of the major components is And he must respond to the suggestions shown in Table 2. and direction of others within the local government structure, be they councillors, RDC members, or water committee members. He will, of necessity, participate in the planning and prioritizing of work to be completed by the organization.

Table 2 Summary of Estimated Expenditure Budget of a Hypothetical Water Service Organization

Annual costs Item R (000's)

Personnel 3,942 Bulk water purchase 5,594 Administration 652 RSC levies 59 Energy 456 Transport 2,214 Chemicals 0 Stores 490 Equipment 806 Contractor and other services 412 Reserve fund for rehabiliation 200 Allowance for future capital improvements 500 Total 15,325

Two alternative assumptions were are explained and presented in detail considered possible regarding the in Appendix E.) level of metering at the end of the 5- year transition period, when full local # The more optimistic scenario is responsibility for water service is that 30% of the 37,500 households reached. (These financial outcomes

63 will have metered stand R3.239 per kl, equivalent to an connections. average monthly bill of R109 • If subsidies were to be phased per metered household. out in 8 years (perhaps a • Finally, if subsidies were to be reasonable alternative to the phased out as planned within 5 planned 5 years), and if 30% of years, the breakeven tariff for households had metered stand the 15% metered households connections, breakeven would be a massive R7.764 per operations would require a kl, generating an average water tariff of R2.059 per kl of monthly bill of nearly R219 per water consumed. This would metered household. generate an average monthly water bill of R80 per metered These calculations indicate that it household. would be financially quite difficult to • If, alternatively, subsidies were introduce a phased program of to be phased out in 10 years, metered stand connections under the same 30% metered realistic conditions if subsidies are to households would face a water be phased out over the proposed 5- tariff of only R1.397 per kl, year period. Breakeven tariffs yielding an average monthly bill of R64 per metered household. • If, however, subsidies were to be phased out in the scheduled 5 years, those 30% metered households would face a water tariff of R4.048 per kl, translating into an average monthly bill of R128.50 per metered household. # The more pessimistic scenario is that 15% of the 37,500 households will have metered stand connections at the end of the 5- year transition period. • If subsidies were to be phased out in 8 years, with 15% of households metered, breakeven operations would require a water tariff of R4.37 per kl, equivalent to an average monthly bill of R136 per metered household. • If subsidies were to be phased out in 10 years, the 15% metered households would encounter a breakeven tariff of

64 would be unacceptably high under the most realistic assumptions, and more acceptable tariff levels would generate crippling operating deficits. Even if subsidies were extended to 8 or possibly 10 years, breakeven tariffs would remain moderately high, but perhaps not prohibitive. The lowest feasible monthly payment levels generated above are in the range of R60 to R80 per month per household. This range occurs with subsidies being phased out over a period of 8 or 10 years, rather than the currently announced 5 years. If the bulk water purchase price paid by the WSO were doubled to R2.00 per kl—a not-unreasonable figure—these average monthly water bills would increase by about half. Although these projections (and the other, higher estimates under various scenarios) seem unacceptably high, further study may not support that conclusion. The only documented evidence available (Fundile Africa 1996) suggests that some households might accept a monthly payment of R20 to R40 for good quality water service (of unspecified volume). As discussed elsewhere in this report, a phased program to gradually introduce metered stand connections should begin in those communities most capable of accepting such a program. Other communities would respond to the possible expansion of metering in light of the results in the first metered areas. The ultimate acceptability of monthly water bills in the R60-to-R80 range—if that were indeed the eventual result of these first initiatives—might depend as much on the quality and reliability of the improved service as on its cost.

65 66 6 TORECOMMENDATIONS LOCAL STRUCTURES FOR TRANSITION

This chapter presents some establish water service assumptions that can be derived from organizations. Financial support the discussion thus far and gives will be required to subsidize the suggestions for ways to move transition to full self-sufficiency forward. The outline of what a longer- for O&M (refer to Appendix E for a term transformation program could discussion of potential subsidy be and the type of technical assistance requirements). Local authorities required is proposed. And finally, a cannot have responsibilities forced short- and medium-term action plan on them without help. for next steps is suggested. # In order to move forward, the transitional issue must be defined 6.1 Key Assumptions for as “developing capacity for water Moving Forward distribution structures,” not as generically developing local government or building # This is a time of major transition community capacity. Elements of in the water sector as well as in development will need to happen local government throughout on all fronts, and setting up the South Africa. There are a lot of water distribution function can expectations for the transition provide positive examples to process (and some may be replicate in other areas of need in unrealistically high in terms of communities and local how long it will take and how government. However, the costly it will be). Realism and objective of capacity-building for leadership are needed to adjust expectations to the possible and to water distribution must be kept move forward. clearly in focus if a manageable # Local authorities will need change process is going to be defined. assistance in making the transition # from the present situation to The most appropriate organization taking full responsibility for water within the governmental structure distribution. to support the development of # Transformation will require WSOs at any level is the resources. Help will be required in Department of Water Affairs and two forms: technical assistance Forestry, even though it has little and financial assistance. Funds experience in this type of will be needed for the transition transformation process. DWAF will and capacity-building program and need assistance in developing and for the necessary equipment to managing a type of transition

67 program new to it, substantially # The capacity-building program different from engineering projects should be locally focused. Local it has managed in the past. staff or potential staff with the # Relationships among all the key most appropriate skills should stakeholders are critically receive training and support from important. Roles need to be kept a number of different sources. clear. Developing the Bushbuckridge Water Board is one 6.2 Dimensions of the project activity, with a set of goals Transformation Program related to overall bulk water supply and an implementing agent One of the major recommended assigned. Development of a water actions (mentioned in Section 6.3) is distribution capacity managed by to design a transformation program in local government is a related but its entirety, so that terms of reference separate activity which will require can be issued and project a different strategy and implementation begun. A suggested approach—using a technical set of goals and a basic framework for assistance team rather than an the transformation program are implementing agent. In this presented in this section. setting, provision of water supply and operation of the water Program Goal distribution system cannot be combined because the functions The goal of the transformation and interests differ so. To create a program should be to develop the balance between water suppliers capacity of future water distribution and end-users, local government organizations and community-based must to be able to buy bulk water water management services in from the new water board at rates Bushbuckridge, Greater Hazyview, which consumers can support. 10 and Nsikazi North. The purpose is to # The specific strategy for transfer of provide improved access to water water distribution services to local services for the population in the authorities will need to be project area while increasing local developed and a structure for capacity for sustainable and implementation beyond present participatory management. The efforts will be required. A ultimate goal of such a program is to transformation program moving improve the health of the population. from the current situation to the future must be broadly focused, with attention to human capacity- building at all levels. Technical 10 The terminology used by the DWAF areas—piping systems, policy paper is Water Service Providers (WSP), to maintenance and repair, workshop denote any organization that processes or facilities, etc.—will need attention distributes water under the management of a as well. In no sense should the Water Service Authority (WSA). In this instance transition be considered a build- the local government structure is the WSA, and the water distribution organization is the WSP operate-train-transfer (BOTT) (including Water Committees). In some cases, the project. WSA may also be the WSP.

68 Key Program Actors Figure 5 Key Program Actors As shown in Figure 5, the transformation program for developing water distribution organizations should be a collaborative effort among five broad categories of participants:

# Organizational clients (people who will be assisted in learning new roles and the recipients of skill transfer and training and technical assistance activities)11 This group includes 1) staff who will work within the water distribution

11Organizational clients are also referred to as “counterparts” to describe the relationship between the technical assistance providers (advisors) and those who receive technical assistance (clients).

69 70 # Sponsoring organization (DWAF or Constitutional Affairs) One lead institution will oversee the policy and norms of the water distribution function and secure funding for the transformation process from the national government, international donors, and possibly national nongovernmental sources. The sponsor will be responsible for ensuring that funds are properly used and for monitoring and supporting the transformation program and process. # Technical assistance team (TAT) Long-term and short-term advisors will support the various organizational clients as they learn how to manage the water distribution function. Long-term advisors should be considered a “core group” of key individuals who maintain a long-term relationship with local staff (counterparts) over the life of the transformation program to help them develop as managers and set up administrative and technical systems. This “TAT core group” should be supplemented by specific, short-term consultants who provide specific skill inputs as needed (for example, an accountant could be called in to provide training in bookkeeping). # Funding organizations (USAID, RDP, Foundations) organizations that are to be set up To date, funding for the (i.e., these who fill the jobs described Institutional Development Project in Chapter 5 in the model WSO); has been provided by USAID and 2) board members or town council the RDP; it has been channeled members who govern WSOs; 3) the through DWAF. Separate RDP community water committee members funding has also been provided who oversee local distribution, collect through DWAF to Mvula Trust to fees, and manage employees. support water committees and community-based programs. The

71 Leon Foundation Water Program # technical skills has received private funding to conduct its own program, which Characteristics of the Technical supports a number of water- Assistance Process related activities. Some combination of funding from these The change strategy will need to build and/or other donors may continue a new generation of managers and in the future, but additional empower key actors to move forward funding will also be needed. without external assistance at the end # External technical assistance of the transformation program. The USAID has provided a small technical assistance process should be amount of intermittent, external characterized as enabling, technical assistance in the form of empowering, helping, and supporting the current EHP team and an EHP individuals who will conduct the daily consultant in the past. It is business of water distribution and assumed that EHP could assist in serve on boards. Indicators for the future with overall project success for technical assistance will strategy guidance and monitoring measure the capacity of the WSP and for DWAF and the TAT and also WSA to conduct key business occasional, specific technical processes without outside assistance. training or advice in areas Skills and knowledge acquisition will unfamiliar to the core TAT. be demonstrated by successful performance at the individual and the Program Components organizational level. If the WSAs are doing the best job they can with the The program will aim to strengthen resources they have, water human resources; develop systems, distribution services to the people structures, and procedures; and should improve. However, it is not the provide commodity support (offices, responsibility of the TAT to achieve equipment). Areas for performance these results; that is the responsibility improvement can be broken down of the staff working for the WSP. The into several components (each area TAT’s job is a helping relationship, not will need specific advisory support): a “doing for” relationship. The TAT’s # organizational development and taking over responsibility for business structuring results (water service provision) # human resources would only serve to weaken the development—training in clients. Ultimately, the TAT- managerial and technical skills counterpart relationship should be and capacity-building one of trust. To build this trust the # consumer and outreach programs TAT personnel must live and work in # community water management the project area and serve as structure development consistent, reliable mentors to the # financial management clients, who will be “counterparts” in # business structures and a real sense. The TAT must bring administrative systems technical skills (in key activity areas) # project and program management; and communicative and mentoring developing a change strategy

72 skills (as supportive trainers) to the medium-term actions should take project. place. The short-term timeframe proposed is the four months from Characteristics of the Technical November 1997 through February Assistance Team 1998. The proposed medium-term timeframe extends through June The essential skill areas required of 1998. the TAT are the following: Short-Term Actions Senior Advisors (long-term): # management and organizational # Revitalize the project coordinating development committee and legitimize it. # finance and administration • Consider renaming the project # community participation and to reflect its purpose. A community management possible name might be “The # operation and maintenance Transformation Program for # human resources development Developing Local Government and Community Capacity for Technical Specialists (short-term/ Water Distribution in the intermittent): Bushbuckridge, Hazyview and # legal issues Nsikazi North Project Area.” # accounting • Ensure that the coordinating # communications and public committee has the awareness participation of two permanent # computer systems representatives from each # mechanical/technical TLC/LRDC, a representative # network maintenance from the Department of # maintenance management systems Constitutional Development, (setting up standard procedures Mpumalanga and Northern for maintaining networks) District representatives, two # administrative and personnel representatives from DWAF, a management BWB representative, five water # health education committee representatives. The # training coordination committee will # strategic planning eventually become the project steering committee for the 6.3 Recommended Actions for transformation program. The the Short- and Medium- organizations and authorities sending representatives should Term provide written authorization to appoint them formally. If the provisional coordinating • Identify a leader for the committee for the Institutional coordinating committee and Development Project finds this “issues empower that leader to act. and options report” acceptable and The EHP team recommends wants to move the process along, a that the DWAF representative number of specific short-term and act in a key facilitative role

73 with (financial) authorizing • Assign task force teams for power for immediate actions or each goal in the strategic plan. until the program is fully # Clarify the funding process for the operational. future IDP and determine # Disseminate this “issues and availability of funds through all options report.” sources. A dissemination task team should • The EHP team will speak with be formed as a subgroup of the USAID staff and ask them to coordination committee. It might clarify their possible future be possible to enlist the assistance role. The response will be of the RDP in Mpumalanga to help communicated to DWAF disseminate the report as well. directly by USAID. Those individuals most prepared • The coordinating committee and willing should plan a series of should assign a task force to follow-up meetings with each TLC. provide follow up. The task team should meet for as much as one day with each local Medium-Term Actions council and the LRDC to explain the issues and options report and # Conduct a follow-up review of the gather questions. At least two issues and options report. months should be allowed for the The EHP team should return and local committees to study and meet with the coordinating digest the report. Questions should committee in a workshop to be collected and summarized for review the draft report and review by members of the EHP incorporate observations as team when they make a follow-up appropriate. This workshop should visit (planned for early 1998). occur around February 1998. # Refocus the strategic plan for the # Further develop a program design IDP. for the transformation process, • Conduct a three-day strategic with enough detail to write a planning retreat. It might be project design and scope of work. possible to engage personnel Develop terms of reference for the from the Fredrich Ebert technical assistance team. (This Foundation to act as could be done by members of the facilitators, given their EHP team during their next visit.) involvement in facilitating the # Conduct an open solicitation and original strategic planning request for proposals to procure a meeting in May 1997. technical assistance team as a • Incorporate the proposed contractor (not an implementing program development steps agent). Pending funding, this recommended in this report solicitation and proposal process into the strategic plan. Review could take place from March the action items, aims, and through May 1998. strategies of the plan for # Set up a subgroup of the possible revision and adjust coordinating committee for project timelines, adding and dropping management. This group could items where appropriate. include one local

74 government representative, one RDP representative, one DWAF representative, one TLC/TRC representative, one water committee representative, and the team leader for the technical assistance team (once engaged). # Begin implementation of the transformation program.

6.4 Conclusions

This report has defined issues the essential problem to be addressed as a need to transform water distribution from the present ad hoc situation to a permanent local government structure. Each local government must decide on the exact organizational structure to adopt, given its unique needs and situation. Bulk supply of water is a related, but separate, developmental issue; a transformation strategy for that structure is underway and will continue. The general conditions for transfer of distribution services and the related policies and issues have been described, and a vision for the appropriate characteristics for successful devolution have been presented.

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