Defaulting municipalities hampering maintenance, warns Rand Water CEO
Rand Water CEO Sipho Mosai says the failure of municipalities to pay their water bills has made it difficult for the entity to fork out money for maintenance.
Mosai briefed the media on Wednesday morning on the state of the bulk water supply.
Gauteng has been battling with severe water supply problems that were recently exacerbated by the violent storms that swept across some parts of the province.
The utility says municipalities in Gauteng, Mpumalanga, and the Free State owe it approximately R5 billion.
It says some municipalities are struggling to pay within the agreed timelines while others are unable to make any payments.
"We are not going to be able to do all the infrastructure development if we are not paid on time. Our data days are still a challenge for Rand Water. As we speak now, end of September, we had a data book of just under R6 billion. As a result, thereof, our net trade receivable from our balance sheet is going to reduce from R6 billion to R3 billion.
“So we are seeing year-on-year, an expected credit loss that is increasing exponentially at a 35% jump from 2022 to R2,15 billion in 2023.”
Mosai singled out Joburg Water as one of the exceptions to the rule.
"Our biggest customer, Joburg Water, is paying us on time. We remain eternally grateful. We thank the mayor, the MMC, finance, water and sanitation infrastructure provision, the MD, and the board of Joburg Water.
“We thank Midvaal, Metsimaholo, Rustenburg and Thembisile Hani for being the best-performing municipalities in our value chain," he said.
Mosai says Tshwane and Ekurhuleni are two of the biggest culprits.
"They are paying, but they are not paying on time. We would like to receive all of the money at the end of the month.
“We have an outstanding amount of about R690,000 from the City of Tshwane and R440,000 from Ekurhuleni. We have received payments this month, and we are hopeful that between the 25 and the end of the month, the current account will be settled.
“Mogale City and Royal Bafokeng are the next two underperforming municipalities. They are paying, but not timeously within the 35 days.”
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