The Portfolio Committee on Water and Sanitation today welcomed early indications of improved payment patterns by certain municipalities to water boards following an earlier decision by National Treasury to withhold the Local Government Equitable Share of defaulting municipalities.
National Treasury intervened in terms of Section 216(2) of the Constitution in an effort to avert the financial collapse of several water boards.
Municipalities' debt to water boards amounted to R24.58 billion, a situation which the committee stressed was unsustainable and a threat to the entire water value chain. In response, National Treasury withheld equitable share allocations from 34 defaulting municipalities in December 2024, March 2025 and July 2025.
The Chairperson of the committee, Mr Leon Basson, noted that ballooning municipal debt has long burdened water boards. "Successive committees have raised concerns about the growing debt owed to water boards and its debilitating impact on their cash flow. The fact that this intervention resulted in a payment of R278 million between 7 July and 25 August 2025 highlights its positive impact," the Chairperson said.
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The committee noted improved payment patterns in municipalities such as Sekhukhune District Municipality, which paid R30.5 million towards its arrears in addition to its current invoices. The Govan Mbeki Local Municipality paid R70 million towards their current invoices, while Rand West City Local Municipality has since paid R72 million.
However, the committee cautioned that the intervention primarily addresses municipalities' current debt to water boards and not long-standing arrears. The committee also highlighted the need for a plan to address this historical debt in order to restore the financial viability of water boards. Some members called for increased investment in the maintenance and upgrading of water infrastructure to reduce non-revenue water losses, a major contributor to high water bills.
The committee further emphasised the need for water boards to continue enforcing standardised debt collection and credit-control measures. These include the consistent application of water restrictions, the attachment of municipal bank accounts, and, as a last resort, the withholding of the equitable share.
The Chairperson said it is encouraging that municipalities are beginning to pay for bulk water services. "Withholding the equitable share reinforces the importance of responsible governance and financial accountability at local government level."
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The committee also stressed the importance of paying for services as the most effective way to avoid such interventions. "This is not a punitive measure, but a corrective one aimed at ensuring that public funds are used effectively to benefit communities that have long endured inadequate water and sanitation services," said Mr Basson.
