Water debt spikes on punitive tariff

Nelson Mandela Bay residents are drowning in debt due to the extra charges on their bills since water restrictions were imposed. Shocking figures released by the municipality yesterday revealed that since the implementation of Part C of the water tariffs structure in June, the outstanding debt for water had risen by R272.1-million. The total amount owed by residents and businesses for water was sitting at a staggering R746.8-million last month. Adding to its money woes, the latest water loss figures for the city show that its strategies to cut down on wastage are not working. Between July last year and January this year, 44.3% of the city’s water was lost through leaks and unbilled water. The loss in monetary terms is about R26.52-million. The municipality’s political head of budget and treasury, Retief Odendaal, said the figure was high because it included the three-month period when staff were on a go-slow due to an impasse over overtime. He said the water loss figure would decrease. The news comes amid a crippling drought which has seen the Bay’s dam levels drop to a combined average of about 24.79%. The municipality is pinning its hopes on the R97-million drought-relief funding it will be receiving from the national Treasury. It is also relying on the extra water it will be getting from the Nooitgedacht water scheme to ensure water security. However, it emerged last week that construction work on phase three of the project is at a standstill as contractors claim they have not been paid by the national Department of Water and Sanitation, which is in charge of the project. The department appointed the Amatola Water Board to implement the project on its behalf.

The fact that the project was at a standstill came up at the infrastructure, engineering and energy committee meeting on Friday. At yesterday’s budget and treasury portfolio meeting, Odendaal raised concerns about the debt the city was saddled with as a result of the Part C water restrictions. “Water [charges] together with interest is of concern,” he said. “We all know the council decided to implement tariff C of the water charges. “Obviously we use the [steeper] tariff to encourage people not to use more water. “But it has the unfortunate effect that if you do have a substantial water leak, you sit with a situation whereby if you have a bill of R4 000 or R5 000 ordinarily, it can quickly shoot up to R150 000. “I get e-mails about this on a daily basis.” He questioned whether the city could not consider abandoning the Part C tariff in favour of a cheaper rate for residents. “We need an indication of whether we are still on the right track and if we should remain on tariff C given the fact that there are consequences.” He said they had to revisit their processes, namely the fact that households were having to foot hefty bills for underground leaks, even though the municipality offered a 50% rebate on underground leaks. “The reality is that a substantial amount is still left for the consumers to pay and we need to have a look at it.” Director of water and sanitation Barry Martin said while a household would normally pay R400 for using 30 kilolitres of water a month on Part A of the tariff structure, on Part C they would pay R900. Martin said if businesses did not decrease their water usage, their bills would be about R5 000 more than before the water restrictions. “What we have found is that raising the tariff is one of the most significant deterrents – for people to use less water,” he said. “People have become much more aware of what they pay.” ANC councillor Rory Riordan said the situation was disquieting.

“While revenue is rising fast, so are the debtors. We are sending bills but they are not being paid, particularly on the water side. “We are obviously outpricing ourselves, which is the same scenario that happened with our property rates issue. “What is the solution to the bills that people are not paying? “It’s causing us the distress of having to cut off people’s services,” Riordan said.

Acting chief financial officer Jackson Ngcelwane said the issue of water debt would be unpacked further at the next committee meeting. Infrastructure and engineering portfolio head Masizole Zinto said the city hoped to curtail the water losses with its 10-year water loss business plan. “This is what is being implemented by the municipality,” Zinto said. “Among [the efforts] was the appointment of 13 plumbers over the last year. “It is a work in progress, progressing fairly well, but there is a lot to be done.”