Issued by: Department of Water Affairs and Forestry
NEW WATER TARIFF POLICY ANNOUNCED
The Minister of Water Affairs and Forestry, Prof. Kader Asmal, MP, will hold a press conference on 28 February 1996 to announce a new water tariff policy for water supplied from Government water schemes.
Early in March the Department of Water Affairs and Forestry will publish the new tariffs for raw water supplied from Government water schemes for 1996/97 in the Government Gazette. Generally the increases will be 30% on previous tariffs. New tariffs are also to be announced for domestic consumers in rural areas.
A new tariff policy has been in development for some time, and has involved extensive consultation with affected parties, both inter-governmental and in the private sector. It represents a major step towards the achievement of economic pricing of water in South Africa as a part of the Department's commitment to the efficient, sustainable and equitable management and supply of water to all.
The current floods do not change the tough long term prognosis - South Africa will face growing water shortages aggravated by recurring drought, unless effective water management measures are taken, including the need to invest in preventive measures to protect South Africa from both flood and drought and recognising the value of water.
The 30% increase in raw water tariffs reflect a step towards establishing the true cost and value of water supply, without Government subsidies, with amendments for distortions caused by inflation, and with regard to future needs and objectives. To put this into perspective it has to be realised that in future the cost of additional raw water will be many times higher than before. An appropriate signal has been carefully scrutinised.
The 30% increase on the raw water tariff will translate to an approximate 10% increase of consumer tariffs and an average monthly household bill will increase between R3 and R6.
This will be the first step in a phased approach which has been adopted so as to minimise sudden negative impact on the economy, rather than a single, large increase. Similar increases will follow in the coming years until the objective of pricing water on economic principles has been achieved.
The increases in irrigation water costs from Government schemes will increase total farming costs by between 2% and 3%. These increased irrigation water costs can in all probability be countered by more efficient irrigation practices. Assistance to farmers cannot be offered through subsidy on this scarce resource although help will be offered to improve water use efficiency.
In a related more, tariffs for domestic and commercial consumers supplied directly from Government water schemes, mainly in the former homelands, are also being revised. The aim here is to first rationalize payment systems between different areas. This is also a further step to upgrade services, to implement tariff structures and to encourage the payment for services.
The Department supports the Masakhane initiatives and believes that all South Africans, farmers, industry, as well as urban and rural households must contribute to Masakhane if the goals of the Reconstruction and Development Programme are to be achieved.
The introduction of a new water tariff policy aimed at long term economic pricing of water is part of the National Water Conservation Campaign which aims to achieve efficient, sustainable and equitable water management, supply and use in South Africa.
The Press Conference will take place at 12h00 for 12h30 on 28 February 196 at 120 Plein Street, Cape Town.
ENQUIRIES: Antoinette Pietersen TEL: (012) 299 3133 CELL: 082 807 3547 28 Feb 1996