Presentation to portfolio committee on water affairs and forestry
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PRESENTATION TO PORTFOLIO COMMITTEE ON WATER AFFAIRS AND FORESTRY PowerPoint PPT Presentation


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PRESENTATION TO PORTFOLIO COMMITTEE ON WATER AFFAIRS AND FORESTRY. WATER BOARDS’ ANNUAL REPORT HEARINGS 6-7 May 2008. Silas Mbedzi Chief Director: Institutional Oversight. DWAF’s OVERSIGHT ROLE OVER WATER BOARDS.

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PRESENTATION TO PORTFOLIO COMMITTEE ON WATER AFFAIRS AND FORESTRY

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Presentation to portfolio committee on water affairs and forestry

PRESENTATION TO PORTFOLIO COMMITTEE ON WATER AFFAIRS AND FORESTRY

WATER BOARDS’ ANNUAL REPORT HEARINGS

6-7 May 2008

Silas Mbedzi

Chief Director: Institutional Oversight


Dwaf s oversight role over water boards

DWAF’s OVERSIGHT ROLE OVER WATER BOARDS

  • Evaluated Shareholder Compacts to determine if five-year plans are viable & sustainable & if appropriate services are provided to WSA; followed by individual appraisal sessions, which provide guidance

  • Compare actual performance to projected performance in the business plan

  • Appraise financial performance through the annual reports & financial statements - individual meetings with boards to discuss DWAF comments & concerns

  • Ensure that tariff processes in terms of sec 42 of MFMA are complied with & tariff increases are timeously tabled in Parliament


Progress with oversight over water boards

PROGRESS WITH OVERSIGHT OVER WATER BOARDS


Reason for botshelo s non submission of ar fs

REASON FOR BOTSHELO’s NON-SUBMISSION OF AR & FS

  • The former acting Financial Manager & former Chief Executive left BW in Nov 2007 and Dec 2007 respectively, without ensuring that the AR & FS were ready for auditing

  • Compilation of FS has been outsourced & completion expected end Feb ’08

  • Auditing by Auditor General expected to be finalized end April ’08

  • AR & FS expected to be ready end May ‘08


Consolidated financial performance of water boards botshelo water s 2005 06 figures included

CONSOLIDATED FINANCIAL PERFORMANCE OF WATER BOARDS [Botshelo Water’s 2005/06 figures included]


Consolidated ratios

CONSOLIDATED RATIOS


Size of boards in terms of sales

SIZE OF BOARDS IN TERMS OF SALES


Profit loss making boards

PROFIT / LOSS MAKING BOARDS


Qualified audits

QUALIFIED AUDITS

SIX OUT OF FIFTEEN QUALIFIED

  • QUALIFIED AUDITS

    Albany Coast Water

    Magalies Water

    Mhlathuze Water

    Sedibeng (North West Region)

  • QUALIFIED WITH EMPHASIS OF MATTER

    Bushbuckridge Water

    Ikangala Water


Challenges solutions

CHALLENGES & SOLUTIONS


Challenges solutions1

CHALLENGES & SOLUTIONS


Issues raised by pc in 2007

ISSUES RAISED BY PC IN 2007

  • ALBANY COAST WATER

    Low book value of assets – a re-valuation of property was performed & reflected in 2007/08 FS

  • AMATOLA WATER

    Transfer of assets to AW- Once results from study on institutional models for water services provision are known, transfer of asset will be fast-tracked

  • BUSHBUCKRIDGE WATE

    Bohlabela DM has been disestablished & debt taken over by Bushbuckridge LM

    Debt owed by Bushbuckridge LM not yet fully recovered; new billing meters installed & credit control measures put in place to ensure recovery


Issues raised by pc in 20071

ISSUES RAISED BY PC IN 2007

  • BOTSHELO WATER

    Internal audit committee appointed in July 2007

    Forensic auditors are investigating the assets reflected as not owned by BW

    New board endeavours to get buy-in from Municipalities to pay their accounts in order to ensure future financial viability of BW

  • IKANGALA WATER

    A consultation process determined whether Board should be disestablished or not – a report was submitted to the Minister during Oct 07 – awaiting her final decision (decision imminent)


Issues raised by pc in 20072

ISSUES RAISED BY PC IN 2007

  • LEPELLE NORTHERN WATER

    Rehabilitation & refurbishment of existing infrastructure is being addressed – Board budgeted R66m for 2007/08 & secured R92m from DWAF & Anglo Platinum

    Upgrading of projects are in progress to increase capacity of schemes to address continuous increase in demand for water

    Ba-Phalaborwa LM paid R18 million of outstanding debt & LNW will write-off interest of R27m when principal debt is serviced

    Protracted sec 78 process prevents LNW from entering into SLA with WSAs

    Capacity constraints are being addressed (i) by enrolling employees in learner ships, apprenticeships & skills programmes

    (ii) With respect to recruitment strategy only qualified & skilled people are targeted for appointment

    (iii) Incentive Policy with retention clause will ensure scarce skills are retained


Issues raised by pc in 20073

ISSUES RAISED BY PC IN 2007

  • MAGALIES WATER

    Retail debtors not included in the FS have been addressed

    Fixed assets were re-valued & auditors provided their opinion in 2006/07 financial year audit

    An actuary re-evaluated the endowment policy in 2007

    SARS confirmed registration of MW as an entity exempt from income tax

  • MHLATHUZE WATER

    Debt collection has improved slightly & is continually monitored for improvement

  • NAMAKWA WATER

    Process to appoint a Manager (not CEO) is underway

    Nama Khoi Municipality cannot take over function of NW as they are struggling financially

    Sec 78 process is nearly completed & will resolve uncertainties concerning viability & future of NW


Issues raised by pc in 20074

ISSUES RAISED BY PC IN 2007

  • OVERBERG WATER

    Staff retention remains a challenge

    Long term contracts with Municipalities not yet concluded, although several meetings were held between DWAF & respective municipalities

    Disclosure of board meeting attendance & remuneration was done in 2006/07 Annual Report

  • PELLADRIFT WATER

    DWAF provided support with strategic planning session & development of BP & Shareholder Compact

  • SEDIBENG WATER

    Interest rate on long-term debt was renegotiated with DBSA, but higher penalties will be charged if loans are redeemed earlier than their maturity dates


The end

THE END

THANK YOU


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