Johannesburg’s Water Crisis: Infrastructure Neglect and Budget Mismanagement

Johannesburg’s water system is facing a severe crisis, with nearly all areas of the city experiencing regular water outages. Some areas are without water for days or even weeks at a time. Despite this, water tariffs have risen by almost 200% over the past decade, outpacing inflation, which has placed additional strain on residents.

The city’s water system struggles due to aging and leaking infrastructure. Currently, 46% of Johannesburg’s water is lost as non-revenue water due to leaks, wasting 400 million liters daily. These leaks cost the city R6 million every day, totaling R2.2 billion annually. To cover these losses, water tariffs are increased, further burdening residents.

To improve water services and reduce costs, repairing the infrastructure is essential. However, Johannesburg Water needs R3 billion annually for the next 10 years for repairs but has only managed to allocate about R900 million for this year, creating a significant funding gap. The cost of repairs is nearly equal to the amount lost through leaks.

Financial Mismanagement and Priorities

At first glance, the “we cannot afford it” argument seems reasonable, as Johannesburg Water reported a negative cash flow after expenses, despite billing over R10 billion last year. However, the City of Johannesburg has the resources; it simply chooses to spend money on less essential services.

Johannesburg Water operates as a separate entity, with its own revenue ringfenced from the city’s general budget. While this is generally seen as good practice, it has become a barrier to addressing the city’s infrastructure issues. The city’s choice to underfund water infrastructure maintenance while spending on non-essential services highlights a significant misallocation of resources.

The Financial Reality

In the 2024 fiscal year, Johannesburg’s main sources of revenue included:

• Electricity: R19.2 billion
• Water: R10 billion
• Wastewater: R6.9 billion
• Waste: R3 billion
• Property rates: R17 billion
• National fuel levy: R3.8 billion

While property taxes generate substantial revenue, much of it is not directed toward essential services. The city spends on non-essentials like councillor lunches, unnecessary office space, and sponsorships, even writing off over R1.5 billion in irregular expenditures last year. This spending undermines the city’s ability to fulfill its constitutional obligations, especially the right to access water.

A Call for Change

Johannesburg must fundamentally revise its budgeting approach. It is crucial to prioritize essential services, such as water infrastructure, above non-essential expenditures. Property taxes, which are the city’s second-largest revenue source, should be used to fund critical services like water infrastructure maintenance.

The city has a constitutional responsibility to ensure that the most important services are funded first. By revising its budget to reflect these priorities and cutting unnecessary expenditures, Johannesburg can start addressing its infrastructure backlog. Without this shift, the city will continue to struggle with water shortages and rising costs, leaving residents without reliable access to water.

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Sourced:Daily Maverick