Rand Water, the prominent water utility provider in South Africa, has expressed deep concern over the mounting debts owed to them by several municipalities.
Gauteng water stability threatened by mounting debt
Despite entering into bulk water purchase and debt settlement agreements, these metros have failed to meet their financial obligations, posing a significant threat to the supplier’s financial sustainability and the provision of water in the region.
Unlike other utilities, Rand Water explained the organisation does not receive funding from the national fiscus and relies solely on revenue collected from its customers, primarily municipalities, to operate.
The timely payment of water bills by municipalities is crucial for the water authority to continue delivering clean and reliable water to communities. However, the non-payment of bulk water fees by these metros has reached an alarming level, jeopardising Rand Water’s financial stability and its ability to provide essential services in the long run.
Rand Water pursues legal action against these debt-owing municipalities
Efforts to address the issue through bilateral engagements and agreements in intergovernmental relations forums have proven unsuccessful.
Despite Rand Water’s willingness to find mutually beneficial solutions, the magnitude of the outstanding debts has forced them to resort to legal action.
The utility provider has decided to pursue court proceedings to enforce compliance with existing agreements and safeguard the integrity of their operations.
Rand Water emphasises that legal action is regrettable but necessary to protect their financial stability.
They have identified specific municipalities, including:
- the City of Tshwane;
- Emfuleni LM;
- Rand West LM;
- Merafong LM;
- Ngwathe LM; and Govan Mbeki LM
Collectively, the above-mentioned municipalities owe Rand Water more than R4 billion.
“It must be noted that the sustainable provision of clean and reliable water supply to millions of South Africans hinges on the responsible fulfillment of bulk water purchase agreements,” Rand Water warned.
While Rand Water remains dedicated to providing high-quality drinking water to its customers, urgent action is required from the implicated municipalities.