Business Case for the Pongola to Umzimkulu CMA D: WMI Governance

1. Business Case for the Pongola to Umzimkulu CMAD: WMI Governance

2. Why develop a business case? • There are effectively two streams of work required in order to establish a CMA. Public Entity CMA National Water Act Proposal Business Case Public Finance Management Act Minister Joint Evaluation Panel Govt Gazette PFMA Schedules (3A) Approval from AG to open an account

3. Requirements of a Business Case • The business case will therefore be built around the following themes (capturing these elements): • Motivation for the entity • Corporate form of the entity • Functions of the CMA • Organisational considerations • Financial arrangements • Institutional and governance arrangements • Mechanisms for Regulation and Oversight • Change management • Risk management • Implementation plan • Various addenda may be developed on specific issues, such as remuneration, performance management and contracts.

5. Description of the Pongola-Umzimkulu WMA • Location • Topography • Climate • Socio-Economic Dynamics • Water Availability and • Requirements • Key Water Challenges

6. Description of the Pongola-Umzimkulu WMA • Location • Topography • Climate • Socio-Economic Dynamics • Water Availability and • Requirements • Key Water Challenges

7. Description of the Pongola-Umzimkulu WMA • Location • Topography • Climate • Socio-Economic Dynamics • Water Availability and • Requirements • Key Water Challenges

8. Description of the Pongola-Umzimkulu WMA • Location • Topography • Climate • Socio-Economic Dynamics • Water Availability and • Requirements • Key Water Challenges

9. Strategic motivation • Water as a finite resource • IWRM • Hydro boundaries • Subsidiarity • Development & empowerment • Viability • Framework for CMA Establishment • Evolution of the CMA • Legitimacy • Consolidation • Responsible Authority

10. Corporate Form • Public Service including: • National Government Agencies • Provincial Government Agencies • Public Entities including: • Stewardship and Research Entities • Service Delivery Entities • Regulatory and Statutory Advisory Entities • Government Enterprises including: • Statutory Corporations and Financial Intermediaries • State Owned Companies • Subsidiary Companies of public entities • State Interest Companies • Public Interest Institutions including: • Education, Welfare, Recreation Institutions and Professional Bodies • Legal nature of CMA • Service Delivery Entity • PFMA, Schedule 3A • A case for devolution • Stakeholder engagement • Ring-fencing risk • Access to skills, specialists • Appropriate corporate form

11. Legal Process • Introduction • Legal requirements • Amendment of the boundaries of the water management area • Disestablishment of the Thukela and Usuthu-Mhlatuze CMA • Amending of the water management area and name of the Pongola-Umzimkulu CMA

12. Functions of the CMA • Introduction • Delegation and assignment • Delegation of functions • Phased transfer of functions • Phase 1: Developing relationships and legitimacy • Phase 2: Build capacity and consolidate • Phase 3: Fully functional and responsible authority • Considerations for the delegation process • Implications for DWA structure and functions

13. Functions of the CMA • Phase 1: Developing relationships and legitimacy • Involvement in water use registration and verification of water use • Advising and supporting licence applicants on the licensing process and requirements • Advising DWA on water use authorisations and licenses • Checking of water use against licence conditions and informing DWA of the results where compliance enforcement is required. • Validation of information submitted for registration. • Phase 2: Build capacity and consolidate • Resource Directed Measures • Water Resources Monitoring • Disaster Management • Water Conservation and Demand Management • Operating of Waterworks • general authorisations and limited authorisation functions • Institutional Oversight • Phase 3: Fully functional and responsible authority • Water Use Authorisation and Licensing • Compulsory Licensing • Issuing of Directives

14. Organisational Arrangements • Proposed functional structure of the Pongola-Umzimkulu CMA

15. Organisational Requirements • Staffing requirements • Human resource considerations • Mechanisms for Regulation and Oversight • Change management • Internal change management • Rebranding and stakeholder engagement strategy

16. Organisational Requirements Yr0 Yr1 Yr2 Yr3 Yr4 Yr5 • Staffing requirements • Human resource considerations • Mechanisms for Regulation and Oversight • Change management • Internal change management • Rebranding and stakeholder engagement strategy Southern Central Northern Total Staff in Year 5 = 140

17. Organisational Requirements • Staffing requirements • Human resource considerations • Mechanisms for Regulation and Oversight • Change management • Internal change management • Rebranding and stakeholder engagement strategy

18. Financial Arrangements • Sources of Finance • Flow of capital • Financial systems arrangements • Financial analysis

19. Institutional and governance arrangements • Corporate Governance Principles • CMA Governing Board • Board membership • Process for appointment of board • Governance Committee Structures • Appointment of CEO

20. Risk & Risk Management • Complexity of the project • Spheres of Government • Stakeholder acceptability • Delegation of powers and functions • Financial management • Climate change and natural disasters • Human resources • Organisational technologies

21. Implementation Considerations • Institutional establishment • WMA boundaries • Ring fencing revenue • Development of the Business Case • Stakeholder engagement • Establishment of the CMA • Organisational development • Appoint the Governing Board • Establish initial systems • Appoint CEO • Transfer and appoint staff

22. Implementation Considerations • Operationalisation • Develop first Business Plan • Transfer of seed funds • Delegation of functions • Oversight and monitoring • Stakeholder engagement and capacity building • Establish and implement engagement plan • Establish and implement capacity building and support programme

23. Thank You!