PRESENTATION OF THE 2005/06 ANNUAL REPORT19 MARCH 2007IN THE NCOP BUILDING IN PARLIAMENT Presented By: Ms. TP. Nyakane – Maluka (Chairperson of BWB) Mr. RS. Matsebula (Chief Executive)
Table of Contents • Section A: The Chairperson’s Statement • Vision, Mission & Strategic Objectives • Appointment and Composition of the Board. • Board Committees • Governance of the Institution • Institutional Performance • Major Challenges • Section B: The Chief Executive’s Report
VisionTo be the best public water services utilityMission“BWB strives to provide sustainable water, sanitation and support services through optimal utilization of appropriate resources and contribute in water resource management to enhance socio-economic development”. Strategic Objectives Providing sustainable water and sanitation Services Pro-actively engaging in water resource management Providing support services to clients Exploring and exploiting strategic ways for organizational financial sustainability and business development activities Continuously participating in community development through corporate social responsibility
Appointment and Composition of the Board • Appointment: March 1, 2006 – February 28, 2010. • Comprises 9 non executive directors • Ms. TP. Nyakane – Maluka (Chairperson) • Mr. R. Ngomane (Deputy Chairperson) • Mr. C. Phiri • Mr. BL. Mavuso • Ms. N. Kubayi • Mr. B. Qokose • Mr. N. Nxumalo • Mr. M. Makhweyane • Ms. B. Ngobeni
Board Committees • Executive Committee: Ms. TP. Nyakane - Maluka • HR Committee: Ms. B. Ngobeni • Audit Committee: Mr. S. Ndlovu • Remunerations Committee: Ms. TP. Nyakane - Maluka • Technical Committee: Mr. M. Makhweyane • Business Dev. & Compliance Committee: Ms. N. Kubayi • Finance and Tender Committee: Mr. C. Phiri
Governance of the Institution • Policies: • Procurement Policy • Fraud Prevention Policy • Appointments: • Chief Executive • Chief Financial Officer • Internal Auditor
Progress on Forensic Audit (2003/4) • Chief Executive: Mr. SG. Nkuna • Suspended: July 13, 2005 • Invited for a disciplinary hearing: March 13, 2006 • Resignation letter: March 10, 2006 • His CCMA application failed • Criminal and Civil case against him • No benefits paid to him until cases are concluded.
Progress on Forensic Audit (2003/4) • Acting CFO: Mr. RH. Maluleke • Suspended: July 13, 2005 • Invited for a disciplinary hearing: April 21, 2006 • Resignation letter: April 20, 2006 • The Board is defending at the CCMA for alleged constructive dismissal. • Criminal and Civil case against him • No benefits paid to him until cases are concluded.
Institutional Performance • Internal Audit: • Price Waterhouse Coopers • Appointment of Internal Auditor is in progress. • MoU’s: • The MoU with Bohlabela District Municipality is being negotiated with the new WSA (BLM). • The MoU with SALGA-Mpumalanga is being implemented. • Strategic Business Focus • Name Change • Repositioning Head Quarters • Improved relationship with Local & Provincial Government and SALGA-Mpumalanga.
Major Challenges • Signing of Service Level Agreements & Cost Recovery. • Disestablishment of Bohlabela District Municipality (WSA) • New Councilors as a result of the Local Government General Elections. • Alleged water quality problems in the Mbombela Local Municipality area. • THANK YOU
The Chief Executive’s Report • Background • Institutional Arrangements • Water Service: Water Resource, Production Maintenance and Distribution. • Corporate Services • Financial Performance • Achievements • Challenges • Targets for 2006/07 • Acknowledgement • Conclusion
Background • Establishment: December 1997 in accordance with the Water Services Act, Act 108 of 1997 • PFMA Listing: A National Government Business Enterprise, listed as Schedule 3 (b). • Governance: 9 non executive directors (as the accounting authority appointed by the minister of DWAF) and the CE as the accounting officer. • Nature of Business: Bulk water service provider to support municipalities. • Employees: 252 people. • Socio-economic profile of the service area: Rural & semi-urban villages (1.2 million people in BLM and MLM areas).
Institutional Arrangements: BLM Area • Agreement: MoU ceded from the previous WSA (BDM). • Personnel: Transferred from DWAF to BWB in 2000. • Infrastructure: • Original infrastructure was handed to BWB in 2000. • New infrastructure is handed over to BWB after completion to operate and maintain. • Ownership of this infrastructure is not yet clarified. • Income: DWAF grants for salaries of DWAF transferred personnel and operation and maintenance of the original schemes. • The ultimate plan: Service level agreement for bulk water services in the BLM area.
Institutional Arrangements: MLM Area • Agreement: Tender Document (2 year contract with DWAF to a Month-Month with MLM until completion of the section 78 processes). • Personnel: Transferred from DWAF to BWB in 2001. • Infrastructure: Handed to BWB in 2001 to operate and maintain and later transferred to MLM on January 1, 2006. • Income: Monthly payment certificates to MLM. • The ultimate plan: Service level agreement for bulk water services in the MLM area.
Water Service: Water Resources • Raw Water Abstraction; • 5 rivers: Klein Sand, Sand, Mutlumuvi, Sabie and Crocodile • And 3 dams: Acornhoek, Edinburgh and Inyaka. • Strong Resources: Sabie river & Inyaka dam (62% lowest level recorded). • Weak Resources: • Mutlumuvi river (no flow during dry season), • the Crocodile river (put sand bags to control flow to the pump station). • Edinburgh and Acornhoek dams.
Water Services: Production • BWB operates 13 schemes; • 9 water schemes in Bushbuckridge Local Municipality (BLM), • 3 water schemes and 1 sewage treatment system in the Mbombela Local Municipality area (since 2001). • Average abstraction, production and loses; • 47.7 Ml/d, 45.5 Ml/d and 6.6% respectively: BLM area • 67.9 Ml/d, 65.3 Ml/d and 3.8% respectively: MLM area • Average Daily Production: 100.8 Ml/d.
Water Quality Monitoring • Sampling Schedules: • Thrice per day at all the works for operational purposes. • Twice per month from water resources water works and distribution networks. • Ad-hoc samples are collected as and when required to investigate specific pollutants. • Compliances: 100% for both physical and bacteriological characteristics and 98% for chemical characteristics. • Non compliance: Kabokweni ponds effluent due to the breach of the ponds. • Neither Cholera nor Typhoid were identified in the drinking water and raw water resources.
Planning and Development • Current Role: • Contribute during development of WSDP’s and IDP’s of the WSA’s. • Monitor implementation of Bulk Water infrastructure projects. • Completed Bulk Water Projects; • Inyaka WTW phase 1B: 5 to 25 Ml/d • Acornhoek WTW: 3 to 6 Ml/d • Shatale WTW: 0.3 to 1.2 Ml/d • Thulamahashe WTW: 3.5 to 7 Ml/d • Current Bulk Water Projects; • Inyaka WTW: 25 to 50 Ml/d • Hoxane WTW: 26 to 53 Ml/d • Bulk pipelines from Inyaka to Acornhoek & Mariti
Corporate Services • Employees: 252 people (85 people in the MLM area and 167 people in the BLM area). • Labor Unions: NEHAWU, PSA and SAMWU. • Employment Equity: • 3 females were appointed during the financial year; 2 accounting clerks, 1 x PA to CEO. • The workplace skills plan: It was submitted to the ESETA, focusing on process operators. • Compliance to OHSA: • Health and safety representatives together with safety committees were established.
Marketing and Communication • Customer Services: • The in-house call centre attends to customer complaints from the WSA and community members on a daily basis. • Community Programs: • The arts competition “ Water for health and economic development” • Monthly visits to WTW’s by student doctors, nurses and schools. • Conducted water conservation education programs at schools. • Participated during National Water Week and Arbor week. • Conducted “Captain Crime Stop programs” with the SAPS at schools.
Financial Performance • In the BDM/BLM Area; • Total Billed Water Sales @R2.67/kl: R44.6m. • Amount Recovered (from WSA’s plus grants): R25.5m • BLM Debt: R 19.1m • BDM Debt: R 26.4m. (carried over from previous financial year) • In the MLM Area; • Project net income: R14.8million. • Loss : R66 879.00 (salary increases and other changes) • BBBEE policy compliance: 20 % was recorded. • The independent auditor’s report; • Qualifications; Recoverability of debt and signing of SLA • Emphasis of matter; regarding ownership of infrastructure.
Latest Developments Towards Improved Cost Recovery • Challenges in the MLM Area; • Alleged water quality problem • Resolved to settle the matter and establish a long term relationship. • Challenges in the BLM Area; • Establishment of a Water Task Team; • Billing Points (identify and implement) Verification of water loss at bulk distribution • Conclude Service Level Agreements (within 3 weeks) • Credit control measures: Reduce water supply by 50% with effect from April 7, 2007. • Bohlabela District Municipality Debt; • Involved DPLG to recover the money from the disestablishment committee.
Achievements • 100% Compliance to water quality standards • IDP’s and WSDP: Participated in the formulation, compilation and review. • BBBEE Policy Compliance: 20%. • Extended Coverage: • Completion of Phase 1B of Inyaka added about 15Ml/day. • Implementation of the distribution plan. • Service Quality: • Uninterrupted service in spite of the difficult financial situation. • Effective support to BLM and MLM: Planning, Repairs.
Targets for 2006/07 • Service Level Agreements: pursue the signing with WSA • Recover debts from BDM and BLM. • Increase investment of infrastructure: Refurbishment/maintenance. • Cost recovery at retail: BWB and BLM will set up systems for billing and collection: Sustain water services. • Maximize production to address service backlog
Targets for 2006/07 (Cont.) • Business Expansion: Expand operations to neighboring municipalities. • Improve reporting to the executive authority and all stakeholders. • Establish corporate head quarters in a strategic area. • Improve on employment equity: Engineer and Director • Support to CMA: Coordinating WRM activities. • Improve on BBEEE by 5%
Challenges • WSA: Disestablishment of BDM require fresh negotiations with BLM • Poor Cost Recovery: Resulting in limited resources to maintain, repair and refurbishment infrastructure. • Business Competition: Difficult to match standard of internationals due to lack of financial resources • Infrastructure: • Lack of ownership dis-empowers the water board • Insufficient Capacity. • Severe drought (Rivers and dams).
Acknowledgement • BWB is acknowledges; • DWAF Regional and National for institutional support. • Bushbuckridge Local Municipality (BLM) for business.. • Mbombela Local Municipality (MLM) for business. • Ehlanzeni District Municipality (EDM) for support. • SALGA – Mpumalanga and DPLG for partnering with us. • South African Association of Water Utilities (SAAWU) for guidance. • The Portfolio Committee on Water Affairs and Forestry for guidance. • Your collective contributions have made us a better institution.
CONCLUSION • Bushbuckridge Water acknowledges that; • there is a duty on all spheres of government to ensure that National government priorities are implemented in a manner, which is efficient, equitable and sustainable. • eradication of poverty and attention to service backlogs are top on the national agenda • water has also become a key pivot for socio-economic development. • Provision of water services has become a major hard stick for measuring performance of Government. • Cooperation of all spheres of Government is inevitable to address service backlogs.