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Water tariff increase is inevitable

Water-stressed South Africa needs to invest a massive R573 billion in water infrastructure, services and demand management over the next decade, but has budgeted for less than half this amount, government said on Monday.

This gap was a “significant shortfall”, water affairs chief operations officer Trevor Balzer told reporters at Parliament.

“If you look at [what is needed across] the total water value chain, you’re looking at a figure of R573 billion over 10 years.”

This included about R394 billion for water services; R162 billion for water resources infrastructure; and R16 billion for water demand management.

“If you look at the current budget allocations, taking into account all of the grant-funded programmes that National Treasury has put in place as well… our 10-year projection is that 44 percent is budgeted for. You’ve got a gap of 56 percent,” Balzer said.

The R573 billion total covered all departmental, municipal and water board infrastructure and services requirements, he said.

Water Affairs Minister Edna Molewa told journalists it was clear a “lot of money” was needed to meet the country’s growing demand for water.

Asked if above-inflation tariff increases to help fund this huge shortfall were now on the cards, she replied: “Probably.”

Molewa said that when a lot of money needed to be found, “it goes without saying that the cost is likely to be very high. And therefore the charges that have to be paid may also be high”.

The department was looking at standardising tariffs across the various sectors, and there was therefore a possibility of cross-subsidisation. This exercise would be completed by the end of the year, the minister said.

Source: Times live

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