PRESENTATION TITLE Presented by: Name Surname

Transcript:PRESENTATION TITLE Presented by: Name Surname:
PRESENTATION TITLE Presented by: Name Surname Directorate Date BRIEFING BY THE DEPARTMENT OF WATER AND SANITATION TOWARDS THE ESTABLISHMENT OF AN INDEPENDENT ECONOMIC REGULATOR Presented by Director General: Sifiso Mkhize 8 November 2017 1 PRESENTATION OUTLINE BACKGROUND PROBLEM STATEMENT STATUS QUO A CASE FOR CHANGE AN EFFECTIVE ECONOMIC REGULATOR GOVERNANCE PROPOSED ORGANOGRAM ESTIMATED BUDGET SOURCES OF REVENUE TRANSITIONAL PLAN PROPOSED CONSULTATION PLAN CONCLUSION 2 1. BACKGROUND National regulatory function lies with the Minister = the Department is responsible for policy-making, support and the regulation of the sector. The implementation of these functions by the Department created a conflict of interest, which affects the decision-making process. The separation of powers and functions of the Department has been deemed necessary for the improvements in the sector, (promote improved sector performance). The Department instituted a project to investigate the most appropriate institutional model for effective economic regulator within the sector. The decision was made to have an internal component in 2014 and the Chief Directorate: Economic and Social Regulation was established 3 2. PROBLEM STATEMENT (1/2) There is a need for an independent Economic Regulator within the water sector to effectively address the following challenges: Insufficient investment in maintenance, refurbishment and replacement of infrastructure. Poor management of services – interrupted supply, water quality, etc High levels of unaccounted for water – theft, wastage, unbilled. Areas still unserved, particularly in sanitation. Weak tariff setting and billing. Value for money in use of grants, (e.g. MIG) and Equitable Share. High levels of debt within the sector. 4 PROBLEM STATEMENT… (2/2) These challenges leads to: unsustainable services; non‐viable institutions; degrading infrastructure, and water users do not get the services they are entitled to and paying for, as according to their human rights. 5 3. STATUS QUO (1/2) 1. Conflict of interest Dual mandate: support and regulate = affects the decision-making. A referee and a player for raw water charges - infrastructure developer and operator, as well as the management body that spends the revenue. 2. Legislative limitation No legal provision for the establishment of the regulator as one of the institutions of the department. 3. Water Services Authorities as regulators Self regulation for WSAs as bulk service providers Municipalities only require and accept support from the national government department. 4. Under capacitated regulated institutions Lack of capacity in both human resources and skills or experience within the sector. 6 7 STATUS QUO…(2/2) 5. Skills for regulatory