By Lebone Rodah Mosima
Civil society organisation WaterCAN has raised concerns over Johannesburg Water’s financial position, alleging that the utility remains unable to meet its operational and financial obligations despite the City of Johannesburg’s commitment to ringfence water and sanitation revenue from 1 July.
The organisation said assurances that revenue generated from water services would remain with Johannesburg Water would be meaningless unless the utility had predictable and immediate access to the funds needed to pay suppliers, maintain infrastructure and keep water services operational.
“WaterCAN has learnt during a Presidential Working Group meeting that the practice of sweeping Johannesburg Water’s accounts has continued into the new financial year,” the organisation said.
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“The City has reportedly swept more than R6 billion from the utility’s bank accounts over the current term of office.”
According to WaterCAN, the transfers have effectively been treated as loans to the City’s shareholder without fixed repayment terms, leaving Johannesburg Water unable to predict when the money will be returned or made available for operational needs.
The organisation said it has repeatedly raised concerns over the City’s cash-sweeping system, under which revenue collected by Johannesburg Water is transferred into the City’s central accounts.
“The consequences of this cash-flow crisis extend far beyond delayed infrastructure projects,” WaterCAN said.
“Johannesburg Water is reportedly struggling to pay for essential operational costs, including telecommunications for depots, which directly affects the coordination of repair teams.”
It added that contracts for water tankers and chemical toilet servicing were under pressure, while critical maintenance and infrastructure projects had stalled because contractors could not be paid.
As a result, communities were waiting longer for repairs as water leaks, pipe bursts and sewer spills continued to increase.
WaterCAN said sustained pressure from the organisation and other civil society groups had contributed to the Presidency’s National Water Action Plan identifying the ringfencing of water revenue as a key strategy to stabilise water service authorities across the country.
WaterCAN executive director Ferrial Adam said the real measure of ringfencing was whether Johannesburg Water had access to the cash required to keep services running.
“You cannot claim to be protecting water revenue with one hand while taking away the cash needed to keep the system running with the other,” Adam said.
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“Ringfencing means nothing if the utility cannot access its own money when it needs to pay contractors, maintain infrastructure, and provide emergency services.”
While acknowledging that the City was under severe financial pressure and that there were no quick solutions, WaterCAN said residents deserved transparency about how essential services would be protected while the City’s finances were being restored.
The organisation argued that the financial difficulties facing Johannesburg Water also exposed wider problems within the municipality.
“Johannesburg Water is not the only municipal entity under financial strain. If City Power cannot pay its creditors and electricity supply becomes unreliable, Johannesburg Water cannot pump, treat and distribute water,” it said.
WaterCAN said the City’s entities were interdependent and that the financial distress of one service quickly affected another, with residents ultimately bearing the consequences.
The organisation called on the City to urgently clarify its plan to pay contractors and resume maintenance, repairs and infrastructure projects, explain how emergency services would be sustained, and provide a timeline for restoring Johannesburg Water’s financial stability.
It also urged Watercom to formally escalate Johannesburg Water’s financial crisis as a matter requiring urgent intervention.
Adam said the issue had evolved beyond an operational challenge.
“This is no longer simply an operational challenge, but a financial crisis that is undermining the City’s ability to provide a basic service and demands action at the highest levels of government,” he said.
“And this is the first real test for Watercom. If it is serious about addressing the country’s collapsing water infrastructure, it should start with the City of Johannesburg.
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“Don’t tell residents how many projects are planned. Tell them whether Johannesburg Water has the money to implement them.”
WaterCAN further called on the City to publicly disclose the mechanism through which water and sanitation revenue is being ringfenced, confirm whether Johannesburg Water has direct and predictable access to its revenue, end the practice of sweeping the utility’s funds into the City’s general accounts, disclose how water-related revenue is allocated and spent, and ensure infrastructure grants and loans are tied to specific projects, budgets, deadlines and publicly reported progress.
The organisation said these measures should be independently monitored through structures including the Presidential Johannesburg Working Group, with oversight from the National Treasury and the Department of Water and Sanitation where necessary.
