Water boards battle to pay suppliers because municipalities don’t pay the boards

It took an average of 341 days for South Africa’s nine water boards to pay their suppliers, which is significantly longer than the required 30 days, parliament heard on Tuesday.

The office of auditor general Tsakani Maluleke was briefing the portfolio committee on water and sanitation on its water board 2020-21 audit outcomes, the first special report informing parliament and the public about the state of financial and performance management at the water boards.

The country’s water boards are Overberg Water, Magalies Water, Rand Water, Bloem Water, Mhlathuze Water, Lepelle Northern Water, Umgeni Water, Amatola Water and Sedibeng Water.

Municipalities are the main customers of water boards and account for most of their income (more than 80% at six of the nine water boards), according to the auditor general’s report. 

“The water boards experienced challenges with collecting these debts because of the worsening financial health in local government,” it noted.

Jolene Pillay, a senior manager in the office of the auditor general, told the portfolio committee: “A challenge for the water boards is how do they manage the collection of debt from municipalities, noting that a certain part of this might be out of their control. But it’s important that the water board determines how they are going to manage the relationship with municipalities and develop a … repayment agreement or some other mechanisms that they would use to ensure that they are eventually recovering money from the municipalities.”