15 August 2005
The Cabinet has approved the establishment of a National Water Resource Infrastructure Agency (NWRIA) by April 2008 to ensure long-term water security for South Africa.
The agency will take responsibility for developing and operating South Africa’s major national dams and water transfer schemes that are currently managed directly by the Department of Water Affairs and Forestry.
These include the Vaal Dam, the Tugela-Vaal transfer system, the Orange River Scheme and the Western Cape system.
The agency will also integrate the TCTA, the parastatal organisation responsible for funding the Lesotho Highlands Water Project.
However, it will not be responsible for domestic water supplies that remain the responsibility of municipalities and regional water boards.
The Department of Water Affairs and Forestry said in a statement earlier this month that the organisation would be a “major” business in its own right, with its assets currently valued at nearly R40-billion and bulk water sales bringing in more than R2-billion annually.
The decision to establish the agency resulted from studies on the management of national water resources infrastructure going back to the 1998 White Paper on a National Water Policy.
“The studies noted that water is a strategic resource for South Africa that faces many water-related challenges, notably extreme rainfall variability that is being aggravated by climate change as well as growing demands from all sectors of the economy and society,” the department said.
This required both close oversight by government of decisions related to the development and allocation of water, as well as effective management of the country’s infrastructure.
“A need was also identified to enable funds to be raised for development projects to serve large users from commercial sources in a manner which allows government’s limited finances to be focused on meeting social needs.”
The Ministry of Water Affairs and Forestry will still be responsible for deciding what projects need to be built, in terms of the National Water Resource Strategy.
The agency will be required to make funding arrangements, ensure that projects are designed and built according to appropriate technical, social and environmental standards, and ensure that they are operated effectively and efficiently.
The establishment of the agency will see a phased integration of the department’s water resource infrastructure branch and TCTA.
The TCTA has already been tasked to finance and implement projects such as the Berg Water Project in the Western Cape and a new R2-billion pipeline from Vaal Dam to assure supplies to Eskom and Sasol.
The department said the integration of TCTA into the new agency would be done in a manner that would not to affect its obligations to the financial markets, its project credit ratings, or explicit government guarantees relating to the Lesotho Highlands Water project.