To address water challenges, eThekwini Municipality Water and Sanitation has been separated from the Trading Services Unit to be a standalone unit.
This was announced by the municipality mayor Cyril Xaba in a media briefing on Sunday. Xaba said by the end of May, Water and Sanitation would be a stand alone unit with all necessary support including its Human Resources.
To achieve this the mayor said the City has developed a Water Turnaround Strategy which has been adopted by Council and approved by National Treasury as part of the trading services reforms introduced to Metros in the country. The mayor said with these changes, the leadership will restore the City’s water and sanitation services back to its former glory
“You will agree with me that a few years ago, eThekwini water and sanitation was number one in the country. With this strategy, we want to restore the water business so that it becomes the utility of the future – consistent with the growth and new demands that are placed on the City,” said the mayor.
Xaba said the new City’s strategy has 13 objectives and key among them include sound financial management, adding that currently, the water and sanitation business is struggling financially, adding the operating cost coverage ratio is sitting at 0.85 and the intention is to reach between 1.2 to 1.5 over a period of five years.
The mayor also lamented the profit margin of the business which he said was very low as the City is sitting with an overdraft of R18 billion for water and R6 billion for sanitation. The mayor said it will take about three years to start to generate a surplus that the City can plough back into the business, particularly for infrastructure.
“We also want water and sanitation to have cash that can cover us for 90 days. Currently the cash collection is 67% and we want to increase our collection to 92% next year,” said the mayor.
With the new turn around strategy, the City also declared war on non-revenue water which is currently 58%. He vowed to reduce the water losses by 5% annually and by 25% over five years.
Secondly, with this strategy we want to address non-revenue water NRW). Currently, our NRW is sitting at 58%. With the strategy that we intend driving aggressively, we must reduce NRW by 5% annually. In five years’ time, we want to reduce NRW by 25%. To achieve the target of 5% reduction in non-revenue water annually, the mayor said the municipality will embark on a wide-range of initiatives which include replacing all water meters that are older than 15 years in the City as well as metering rural areas under Ingonyama Trust land but falling within eThekwini municipality.