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Infrastructure Barometer 2006 - Development Bank of Southern Africa
2006 Economic and Municipal Infrastructure in South Africa THE DBSA INFRASTRUCTURE BAROMETER 2006 THE DBSA INFRASTRUCTURE BAROMETER Economic and Municipal Infrastructure in South Africa The DBSA Infrastructure Barometer 2006 Published by: Development Bank of Southern Africa Knowledge Management Division Policy Research Unit Midrand March 2006 The DBSA Infrastructure Barometer 2006 ISBN: 1-919692-72X Intellectual Property and Copyright © Development Bank of Southern Africa Limited This report is part of the knowledge products and services of the Development Bank of Southern Africa Limited and is therefore the intellectual property of the Development Bank of Southern Africa Limited. All rights are reserved. No part of this document may be reproduced, stored in a retrieval system or be transmitted in any form or by any means, whether electronic, mechanical, photocopied, recorded or otherwise, without the prior permission of the Development Bank of Southern Africa. Legal Disclaimer The findings, interpretations and conclusions expressed in this report are those of the author/s and are not necessarily those of the Development Bank of Southern Africa. In the preparation of this document, every effort has been made to offer the most current, correct and clearly expressed information possible. Nonetheless, inadvertent errors can occur, and applicable laws, rules and regulations may change. The Development Bank of Southern Africa Limited makes its documentation available without warranty of any kind and accepts no responsibility for its accuracy or for any consequences of its use. This document may be ordered from: DBSA Knowledge Centre Development Bank of Southern Africa PO Box 1234 Halfway House 1685 South Africa Telephone: +27 11 313 3911 Telefax: +27 11 318 1949 E-mail: [email protected] Preface The availability of appropriate economic and social infrastructure represents a major platform for promoting economic growth and the universal goal of ensuring that people have access to sustainable and affordable basic services, such as water, sanitation and power. The need to address backlogs, and to upgrade and expand key social and economic infrastructure are cornerstones of government’s policy, strategy and programmes to promote sustainable economic growth and to achieve a better life for all. This has recently been reiterated in the Accelerated and Shared Growth Initiative (ASGISA) announced by the President in his State of the Nation Address on 3 February 2006, and in the expenditure commitments made by the Minister of Finance in his Budget Speech on 15 February 2006. Sound policy decisions, programme design, budgeting and implementation require reliable data and information. This publication, accordingly, seeks to contribute to the body of knowledge regarding this complex sector, and to assist by providing current data and analysis as an input to decision-making. The DBSA Infrastructure Barometer 2006 provides an overview of the current state of infrastructure in the key sectors of water and sanitation, energy, ICT and transport; and it identifies backlogs and the challenges and constraints that face all spheres of government in addressing South Africa’s future needs. In this regard, municipal infrastructure services receive special attention. The local sphere of government plays a particularly important role in the delivery of basic services, as well as infrastructure to support local economic development. The challenges currently facing this sphere of government in fulfilling its key delivery role are daunting, and it is hoped that the Infrastructure Barometer 2006 will provide a useful tool for those responsible for project planning and implementation at this crucially important delivery interface. In the analysis and discussion, the publication attempts to identify key policy concerns and possible solutions to the many challenges posed by issues such as sustainability, affordability, appropriate levels of service and the capacity to deliver, maintain and operate infrastructure. While it is beyond the scope of the Infrastructure Barometer 2006 to provide definitive answers to these complex questions, I trust that it will contribute not only to the intellectual debates, but also in practical ways towards finding new and innovative solutions to the challenges of infrastructure delivery in South Africa. Mandla Gantsho Chief Executive Development Bank of Southern Africa PREFACE 1 Editor’s Note The DBSA Infrastructure Barometer team is proud to present this report on economic and municipal infrastructure in South Africa. As the development finance institution mandated to fund economic, social and institutional infrastructure in the SADC region, the DBSA is ideally placed to consolidate important information on infrastructure and to present such knowledge to our shareholder and our clients. This report is therefore first and foremost a knowledge product. It aims to provide its readers with up-to-date, relevant and interesting information. The focus of this report is on the history and current realities of South Africa’s infrastructure. The DBSA Infrastructure Barometer is the brainchild of the DBSA Chief Executive, Mandla Gantsho. He requested the Knowledge Management Division to publish this infrastructure barometer as an important source of information and knowledge to the many institutions and individuals concerned with the development and growth of infrastructure in the South Africa. We therefore approached the production of the report from a national interest point-of-view. This report is not about DBSA’s role in the development of infrastructure, but rather addresses infrastructure as a national asset. It carefully unpacks this complex sector, which consists of multiple parts and players, and presents the reader with a better insight into, and better comprehension of, this concept of “infrastructure”. The report consists of three Parts, each of which looks at South Africa’s infrastructure realities from a completely different perspective. Before readers approach Part I, they should read the introduction, as it sets the scene for the report as a whole. The Introduction provides the reader with tools to unpack and understand infrastructure in South Africa. Part I follows, consisting of three chapters, all of which are on economic infrastructure, viewed from a national or macro level perspective. Chapter 1 starts with a timeline illustrating key events contributing to the development of the four selected economic infrastructure sectors: transport, energy, water, and information and communications technology (ICT). Chapter 2 presents the same four sectors, and provides a detailed overview of the policy, regulatory, institutional and financial dynamics governing each of these four sectors in South Africa. Chapter 3 provides a visual overview, using maps and figures, to illustrate the scope and geographical spread of key investments in these four sectors. Part II, also consisting of three chapters, focusses on municipal infrastructure, and moves away from the macro level analysis to the household level. Chapter 4 describes infrastructure backlogs in South Africa, and unpacks each of the key household-level services (water, sanitation, electricity and telephones) by province to illustrate where and to what extent service backlogs remain throughout the country. Chapter 5 goes a step further and uses this backlog information to quantify the investment required to meet government’s infrastructure service targets. Chapter 6 adds further value to the facts and figures presented before by placing the spotlight on selected “marginal” communities. The chapter aims to unpack some of the typical constraints that these municipalities struggle with, and to suggest some solutions. Part III consists of a full and comprehensive set of municipal level service provision data, on a national, provincial, district and local municipal level. The report has been prepared by a DBSA team, assisted by a number of external experts. Refer to page 3 for a full list of contributors. I would like to acknowledge each of the DBSA team members, who managed always to envisage the final product, through our debates about a figure or a date or even a single sentence. I need to mention four people by name. Firstly, Janine Thorne, Manager of the Policy Research Unit, for giving me scope and freedom to conceptualise and complete this report. Secondly, Snowy Khoza, Executive Manager of the Knowledge Management Division for her encouragement and trust. Thirdly, Rina Roothman, who co-ordinated the process from start to end with never-ending efficiency and drive. Finally, Kevin Wall (CSIR BOUTEK), the technical editor, for his insight and thoroughness. The report is a product of the staff of the DBSA and, as such, the findings, interpretations and conclusions are those of the team. They do not necessarily reflect those of DBSA’s governance. The DBSA team took great care in presenting the data and facts, but complete accuracy cannot be guaranteed. Marié Kirsten Editor: The DBSA Infrastructure Barometer 2006 2 THE DBSA INFRASTRUCTURE BAROMETER Acknowledgements Editor Marié Kirsten Coordinator Rina Roothman Information Editor Andries Mouton Internal Core Team Dr Thuthula Balfour Callie Calitz Peter Copley Glynn Davies Dr Priscilla de Gasparis George Finger Barry Jackson Dr Patrick Karani Elsa Kruger-Cloete Jean Madzongwe Dr Moraka-Nakedi Makhura Mike Marler Richard Marwood Dr Andrew Shaw Mbulelo Tshangana Dr Tobie Verwey Background Paper Authors Johann Basson Dr Anthon Botha Dr Rolfe Eberhard Dr Malcolm Mitchell Caroline Ogutu Prof Richard Tomlinson Dr Kevin Wall External Reviewers Heloise Emdon Hassen Mohamed Malijeng Ngqaleni Technical Editor Dr Kevin Wall Language Editor Keith Sanderson Management Dr Snowy Khoza Janine Thorne ACKNOWLEDGEMENTS 3 Abbreviations 3G ACSA ADSL AEC AM AP ATNS BEE BEVA BOT BTSC CAA CAGR CBD CDM CEF CER CERN CFL CSIR CMA CRM CSSA CWSSP DBSA DCT DIU DME DOA DOC DOT DPLG DRS DSM DST DStv dti DWAF ECB EDC EDI(H) EDRC EIA ERWAT ESCOM ESI ESKOM FCCC FDI FFC FM GAMAP GAPD GCIS GDP GEAR GFB 4 Third Generation Airports Company of South Africa Asynchronous Digital Service Line Atomic Energy Corporation Amplitude Modulation Agent Position Air Traffic and Navigational Services Company Black Economic Empowerment Nuclear Fuel Fabrication Plant Build, Operate, Transfer Bangkok Transit System Corporation Civil Aviation Authority Compounded Annual Growth Rate Central Business District Clean Development Mechanism Central Energy Fund Carbon Emission Reduction European Centre for Nuclear Research Compact Fluorescent light Council for Scientific and Industrial Research Catchment Management Agency Customer Relationship Management Computer Society of South Africa Community Water Supply and Sanitation Programme Development Bank of Southern Africa Durban Coal Terminal Development Information Unit Department of Minerals and Energy Department of Agriculture Department of Communications Department of Transport Department of Provincial and Local Government Deeds Registry System Demand-Side Management Department of Science and Technology Digital satellite television Department of Trade and Industry Department of Water Affairs and Forestry Electricity Control Board Energy Development Corporation Electricity Distribution Industry (Holdings) Energy for Development Research Centre Environmental Impact Assessment East Rand waste water utility Electricity Supply Commission (until 1987) Electricity Supply Industry Eskom Holdings Ltd (since 2001) Framework Convention on Climate Change Foreign Direct Investment Financial and Fiscal Commission Frequency Modulation Generally Accepted Municipal Accounting Practice Governance, Administration, Planning and Development Government Communication and Information Service Gross Domestic Product Growth, Employment And Redistribution General Freight Business THE DBSA INFRASTRUCTURE BAROMETER GHG GHS GNP GPRS GRAP GSM GTZ HIV & AIDS HP IBA ICASA ICDL ICT IDC IDP IDZ IEA IFAW IGFR IPP ISDN ISP ISRDP ISSA IT JPTC LAN LHWP LNG LOS LPG MCT MFF mgt MIG MIIF MPCC MSA NEMISA NER NERI NERSA NLTTA NNR NPA NRA NRF NRF NSDP NTC PATU PBMR PC PDA PDG PIT POP Greenhouse gases General Household Survey Gross National Product General Packet Radio Services Generally Recognised Accounting Practice Global System for Mobile communication Gesellschaft für Technische Zusammenarbeit Human Immunodeficiency Virus & Acquired Immune Deficiency Syndrome Hewlett Packard Independent Broadcasting Authority Independent Communication Authority of South Africa International Computer Driving Licence Information and Communications Technology Industrial Development Corporation Integrated Development Plan Industrial Development Zone International Energy Agency International Fund for Animal Welfare Inter-Governmental Fiscal Review Independent Power Producer Integrated Services Digital Network Internet Service Provider Integrated Sustainable Rural Development Programme Institute for Satellite and Software Applications Information Technology Joint Permanent Technical Commission Local Area Network Lesotho Highlands Water Project Liquefied Natural Gas Level of Services Liquefied Petroleum Gas Matola Coal Terminal Municipal Fiscal Framework Million gross tonnes Municipal Infrastructure Grant Municipal Infrastructure Investment Framework Multi-Purpose Community Centre Moving South Africa National Electronic Media Institute of South Africa National Electricity Regulator National Energy Research Institute National Energy Regulator of South Africa National Land Transport Transition Act National Nuclear Regulator National Ports Authority National Roads Agency National Research Foundation National Road Fund National Spatial Development Perspective National Transport Commission Pan African Telecommunication Union Pebble-Bed Modular Nuclear Reactor Personal computer Personal Digital Assistant Palmer Development Group Public Information Terminals Point of Presence ABBREVIATIONS 5 PPP PWD PWR RBCT RDP RED RWB SAA SAAEE SABC SABS SADC SAIX SALGA SANRAL SAPIA SAPO SAPO SAPP SAR&H SARCC SASOL SATRA SATS SDI SEMA SFF SHS SITA SMME SMS SNO SOE TBVC TCTA tcf Telco teu URP USA USAL UTA VANS VFP VoIP WAN WASP WB WiFi WLAN WMA WSA WSDP WSI WSP WSSD WUA 6 Public Private Partnership Public Works Department Pressurised Water Nuclear Reactor Richards Bay Coal Terminal Reconstruction and Development Programme Regional Electricity Distributor Rand Water Board South African Airways South African Association for Energy Efficiency South African Broadcasting Corporation South African Bureau of Standards Southern African Development Community South African Internet Exchange South African Local Government Association South African National Roads Agency Ltd South African Petroleum Industry Association South African Port Operations South African Post Office South African Power Pool South African Railways and Harbours South African Rail Commuter Corporation South African Coal, Oil and Gas Corporation South African Telecommunications Regulatory Authority South African Transport Services Spatial Development Initiative South African Energy Management Association Strategic Fuel Fund Solar home system State Information Technology Agency Small, Medium and Micro Enterprise Short Messaging Service Second National Operator State-Owned Enterprise Transkei, Bophuthatswana, Venda, Ciskei Trans Caledon Tunnel Authority Trillion cubic feet Telecommunication company Twenty-foot equivalent unit Urban Renewal Programme Universal Service Agency Under-Serviced Area Licensee Urban Transport Act Value-Added Network Services Victoria Falls Power Company Voice over Internet Protocol Wide Area Network Wireless Application Service Providers Water Board Wireless Fidelity Wireless Local Area Network Water Management Area Water Services Authority Water Services Development Plan Water Services Infrastructure Water Services Provider World Summit on Sustainable Development Water User Association THE DBSA INFRASTRUCTURE BAROMETER Contents Preface ............................................................................................................................................................ 1 Editor’s Note ................................................................................................................................................... 2 Acknowledgements ....................................................................................................................................... 3 Abbreviations ................................................................................................................................................. 4 Contents .......................................................................................................................................................... 7 Executive Summary ............................................................................................................ 14 Introduction........................................................................................................................ 17 Background ................................................................................................................................................... 17 What development? ..................................................................................................................................... 17 What infrastructure? .................................................................................................................................... 20 How infrastructure supports development ................................................................................................ 21 Economic linkages – infrastructure and growth ........................................................................................ 22 Social linkages – infrastructure and poverty alleviation ............................................................................ 22 A concluding comment – reforming the role of government ................................................................... 23 Defining Infrastructure ................................................................................................................................ 26 PART I UNDERSTANDING ECONOMIC INFRASTRUCTURE IN SOUTH AFRICA Chapter 1: The Historical Context Introduction .................................................................................................................................................. 31 Infrastructure History “at a glance” ............................................................................................................ 32 Transport ....................................................................................................................................................... 34 Background ............................................................................................................................................... 34 Transport Infrastructure Development .................................................................................................... 34 Energy ........................................................................................................................................................... 43 Background ............................................................................................................................................... 43 Energy Sector Policy .................................................................................................................................. 44 Sources of Energy ...................................................................................................................................... 44 Water and Sanitation ................................................................................................................................... 50 Background ............................................................................................................................................... 50 Water Resources ........................................................................................................................................ 51 Water Services ........................................................................................................................................... 53 Irrigation .................................................................................................................................................... 55 Information and Communications Technology (ICT).................................................................................. 55 Background ............................................................................................................................................... 55 Historical Context ...................................................................................................................................... 56 Regulations ................................................................................................................................................ 56 Access to Broadcasting, Post and Telecommunications .......................................................................... 57 Technology ................................................................................................................................................ 58 Post-2000 ................................................................................................................................................... 58 Spotlight on New England Road Landfill, Msunduzi Municipality: Landfill Gas Use Study .......60 Chapter 2: The Operating Environment Introduction .................................................................................................................................................. 63 Transport ....................................................................................................................................................... 63 Introduction .............................................................................................................................................. 63 Policy .......................................................................................................................................................... 63 Regulatory Environment .......................................................................................................................... 65 CONTENTS 7 Institutional Environment ........................................................................................................................ 69 Financing Framework ............................................................................................................................... 70 Energy ........................................................................................................................................................... 73 Introduction .............................................................................................................................................. 73 Policy .......................................................................................................................................................... 73 Institutional Structure and Ownership .................................................................................................... 74 Regulatory Environment .......................................................................................................................... 78 Environmental Regulation ....................................................................................................................... 79 Financing Framework ............................................................................................................................... 80 Water and Sanitation ................................................................................................................................... 81 Introduction .............................................................................................................................................. 81 Policy .......................................................................................................................................................... 81 Institutional Structure ............................................................................................................................... 82 Regulation ................................................................................................................................................. 84 Financing Framework ............................................................................................................................... 85 Information and Communications Technology (ICT).................................................................................. 88 Introduction .............................................................................................................................................. 88 Policy .......................................................................................................................................................... 88 Institutional Structure ............................................................................................................................... 89 Regulatory Environment .......................................................................................................................... 92 Financing Framework ............................................................................................................................... 94 Investment Outlook .................................................................................................................................. 95 Spotlight on Restructuring of Urban Rail Systems .........................................................................96 Chapter 3: State of Infrastructure Introduction .................................................................................................................................................. 99 Transport ....................................................................................................................................................... 99 Introduction .............................................................................................................................................. 99 Road, Rail, Port and Pipeline Infrastructure ............................................................................................ 99 Conclusion ............................................................................................................................................... 108 Energy ......................................................................................................................................................... 108 Introduction ............................................................................................................................................ 108 Electricity ................................................................................................................................................. 108 Liquid Fuels .............................................................................................................................................. 116 Gas ........................................................................................................................................................... 117 Renewable Energy .................................................................................................................................. 118 Conclusion ............................................................................................................................................... 118 Water and Sanitation ................................................................................................................................. 119 Introduction ............................................................................................................................................ 119 Water Resources ...................................................................................................................................... 119 Water Services ......................................................................................................................................... 121 Irrigation .................................................................................................................................................. 123 Conclusion ............................................................................................................................................... 124 Information and Communications Technology (ICT)................................................................................ 124 Introduction ............................................................................................................................................ 124 Information Technology ......................................................................................................................... 124 Computers ............................................................................................................................................... 126 Communication Technology ................................................................................................................... 128 Convergence ............................................................................................................................................ 132 Conclusion ............................................................................................................................................... 133 Spotlight on the Tembisa/Kempton Park Electrification Programme .........................................134 Part I: Conclusion.............................................................................................................. 136 8 THE DBSA INFRASTRUCTURE BAROMETER PART II ACCESS TO INFRASTRUCTURE IN SOUTH AFRICA Chapter 4: Infrastructure Service Backlogs Background ................................................................................................................................................. 143 Introduction ................................................................................................................................................ 143 Water........................................................................................................................................................... 144 Sanitation .................................................................................................................................................... 147 Energy ......................................................................................................................................................... 149 Telephones .................................................................................................................................................. 152 Mode of Travel in Urban and Rural Areas ................................................................................................ 154 Other Surveys .............................................................................................................................................. 156 Conclusion ................................................................................................................................................... 158 Spotlight on the Somerspost Water Project .................................................................................160 Chapter 5: Modelling the Financial Implications of Municipal Service Delivery Introduction ................................................................................................................................................ 163 The Municipal Infrastructure Investment Framework ............................................................................. 163 Building a Financial Model ........................................................................................................................ 165 Elements of the Model ........................................................................................................................ 165 Services Included in the Model ............................................................................................................ 165 Types of Municipality ............................................................................................................................ 165 Current Access to Services .......................................................................................................................... 166 Base Data............................................................................................................................................... 166 Summary Data of Access to Services .................................................................................................... 167 Service Level Targets .................................................................................................................................. 168 Setting the Targets ............................................................................................................................... 168 Service Level Targets -- Summary ........................................................................................................ 169 Financing ..................................................................................................................................................... 170 Capital Expenditure .............................................................................................................................. 170 Sources of Capital ................................................................................................................................. 171 Operating Expenditure......................................................................................................................... 171 Operating Revenue............................................................................................................................... 171 Subsidy Allocation to Local Government ............................................................................................ 173 Cross Subsidy Potential ......................................................................................................................... 173 Operating Account ............................................................................................................................... 174 Results on a National Scale ........................................................................................................................ 174 Capital Spending and Sources of Funding: Capital Grant Implications ............................................. 174 Implications for MIG Subsidies ............................................................................................................. 176 Implications for Housing Subsidies ...................................................................................................... 176 Implications for the Use of Municipalities Own Capital Finance ....................................................... 176 Operating Budget Implications............................................................................................................ 177 Conclusions ................................................................................................................................................ 178 Spotlight on ICT making a difference in the lives of poor communities ....................................180 Chapter 6: Challenges for Municipal Infrastructure Service Delivery in Marginal Communities Introduction ................................................................................................................................................ 183 Marginal Communities and Services Delivery ........................................................................................... 183 Service Levels and Services Backlogs.................................................................................................... 183 Household Incomes .............................................................................................................................. 184 Location of Marginal Communities ..................................................................................................... 184 CONTENTS 9 Social Environment for Infrastructure Service Delivery ........................................................................... 185 Increase in the Number of Households ............................................................................................... 185 Changing Location of Low-Income Households ................................................................................. 186 HIV and AIDS, Services Levels and the Ability to Pay for Services ..................................................... 187 Consumers, Levels of Service and Affordability in Marginal Communities....................................... 188 The Policy and Legislative Environment ................................................................................................... 188 Developmental Local Government and the Role of Municipalities .................................................. 188 Municipal Legislation for Infrastructure and Services ........................................................................ 189 Policy Instruments for Infrastructure and Service Delivery to Marginal Communities .................... 189 Institutional Challenges to Service Delivery ............................................................................................. 190 Capacity Needed to Deliver Infrastructure .......................................................................................... 190 Institutional Capacity and Governance ............................................................................................... 191 Infrastructure Asset Management and Efficiency .............................................................................. 191 Municipalities Servicing Marginal Communities ................................................................................. 192 Financial Challenges ................................................................................................................................... 192 Difficulties of Cost Recovery from Consumers in Marginal Communities ........................................ 192 Finance and Risk ................................................................................................................................... 193 Conclusion .................................................................................................................................................. 195 Part II: Conclusion............................................................................................................. 196 References ........................................................................................................................ 199 BOXES, FIGURES AND TABLES Boxes Box 1 Box 2 Box 3 Box 4 Box 5 Box 6 Box 7 Box 8 Box 9 Box 10 Box 11 Box 12 Box 13 Box 14 Box 15 Box 16 Box 17 South Africa’s infrastructure and economic growth .......................................................... 19 The historical evolution of Infrastructure in South Africa................................................. 21 eThekwini Transport Authority ........................................................................................... 38 South Africa’s Energy Policy Objectives .............................................................................. 44 Energy and the economy ..................................................................................................... 46 Rand Water........................................................................................................................... 54 Reflections on the Rural Water Supply Programme .......................................................... 55 Moving South Africa ............................................................................................................ 64 Energy and the Environment .............................................................................................. 75 Energy efficiency and Eskom’s DSM programme ............................................................. 118 Increase in access ................................................................................................................ 144 Interpreting telecom data ................................................................................................. 153 A case of a typical B2/B3 municipality .............................................................................. 189 Institutional capacity and governance of a typical B2/B3 municipality .......................... 190 Challenges to generating revenue.................................................................................... 193 Financial management challenges of a typical B2/B3 municipality ................................ 194 Some interventions for a typical B2/B3 municipality ....................................................... 195 Figures Figure 1 Figure 2 Figure 3 Figure 4 Figure 5 Figure 6 10 Infrastructure investment as a percentage of GDP ............................................................ 19 Gross capital formation compared to growth.................................................................... 19 Infrastructure history “At a glance” ................................................................................... 32 Total government capital and maintenance expenditure on roads ................................. 35 Tonnages of freight moved by road and by rail ................................................................ 40 Patronage of South African commuter rail ........................................................................ 41 THE DBSA INFRASTRUCTURE BAROMETER Figure 7 Figure 8 Figure 9 Figure 10 Figure 11 Figure 12 Figure 13 Figure 14 Figure 15 Figure 16 Figure 17 Figure 18 Figure 19 Figure 20 Figure 21 Figure 22 Figure 23 Figure 24 Figure 25 Figure 26 Figure 27 Figure 28 Figure 29 Figure 30 Figure 31 Figure 32 Figure 33 Figure 34 Figure 35 Figure 36 Figure 37 Figure 38 Figure 39 Figure 40 Figure 41 Figure 42 Figure 43 Figure 44 Figure 45 Figure 46 Figure 47 Figure 48 Figure 49 Figure 50 Figure 51 Tonnages handled at South African ports, 2001/02 ........................................................... 42 Numbers of domestic and international passengers passing through ACSA managed airports ................................................................................................................. 43 Primary sources of energy in 2000 ...................................................................................... 45 Number of dams commissioned in South Africa (by decade)............................................ 51 DWAF capital expenditure on water resources in real terms (2000 prices) ...................... 52 Comparison between fixed line and mobile telephones................................................... 59 The proposed structure of Transnet .................................................................................... 67 Road funding financial flows, 2000/01 ............................................................................... 71 National electricity system (2002) ....................................................................................... 74 Schematic presentation of liquid fuel system .................................................................... 76 National Regulatory Framework for Water Services ......................................................... 84 Internet Solutions IS national backbone ............................................................................ 91 The impact of convergence on the ICT sector .................................................................... 93 Institutions and their roles in ICT financing ....................................................................... 94 Road infrastructure in South Africa .................................................................................. 100 The visual classification of South African route conditions............................................. 101 Annual Provincial Road Expenditure for South African Provinces, 2001 to 2005 .......... 102 Rail and port network of South Africa ............................................................................. 103 Capital expenditure as a proportion of turnover for Transnet ....................................... 105 Location and physical characteristics of South Africa’s 23 main airports ....................... 107 Eskom’s current generating capacity ................................................................................ 111 Major transmission lines .................................................................................................... 112 Households electrified, 2002 ............................................................................................. 114 Changes in the percentage of households electrified ..................................................... 114 Petronet pipelines .............................................................................................................. 116 Mean annual rainfall distribution in South Africa ........................................................... 119 The 20 largest dams in South Africa ................................................................................. 120 Water Management Areas (WMA) and inter-WMA transfers......................................... 121 Current Water Board service areas ................................................................................... 122 Composition of the South African IT market sub-sectors (percent)................................ 125 Expected growth in South African IT market sub-sectors, 2004 - 2009 .......................... 125 Distribution of IT expenditure by economic sector (percent) ......................................... 126 Cumulative investment in mobile telephony infrastructure in South Africa, 2000 - 2009 ...... 130 South Africa and provinces: Percentage of households without access to piped water, 1996 and 2001 .............................................................................................. 145 Provinces: Number of households without access to piped water, 1996 and 2001 .................................................................................................................... 145 South Africa: Main types of water source used by households (percent), 2001 ............ 146 South Africa and provinces: Percentage of households without access to sanitation, 1996 and 2001 .................................................................................................................... 147 Provinces: Number of households without access to sanitation, 1996 and 2001........... 148 South Africa: Main types of toilet used by households (percent), 2001 ......................... 149 South Africa and provinces: Percentage of households not using electricity as an energy source for lighting, 1996 and 2001 ............................................................. 150 Provinces: Number of households not using electricity as an energy source for lighting, 1996 and 2001 ............................................................. 150 South Africa: Main energy sources used by households for lighting (percent), 2001...........151 South Africa and provinces: Percentage of households with no access or no nearby access to telephones, 1996 and 2001 .............................................................. 152 Provinces: Number of households with no access or no nearby access to telephones, 1996 and 2001 ................................................................................ 153 South Africa: Main types of telephone used by households (percent), 2001................. 154 CONTENTS 11 Figure 52 Figure 53 Figure 54 Figure 55 Figure 56 Figure 57 Figure 58 Figure 59 Figure 60 Figure 61 Figure 62 South Africa: Mode of travel of the employed and scholars in urban areas (percent), 2001 ................................................................................................................... 155 South Africa: Mode of travel of the employed and scholars in rural areas (percent), 2001 ................................................................................................................... 155 Summary of number of households without access to adequate services, 2004 ........... 167 Progress in addressing backlogs, 2001 – 2004. ................................................................. 168 Service delivery targets by service type ............................................................................ 169 Operating account comparison for different types of municipality based on 2003/04 figures (municipalities only, excluding non-municipal service providers) ...................... 172 Estimated capital expenditure for municipal infrastructure (R million at constant 2004/05 prices) ............................................................................... 175 Predicted sources of capital required to cover estimated capital expenditure (R million at constant 2004/05 prices) ............................................................................... 175 Operating expenditure results for chosen scenario (constant 2003/04 prices) .............. 177 Predicted sources of revenue for chosen scenario (constant 2004/05 prices)................. 177 Operating account comparisons with detail of individual services (real terms, constant 2003/04) ........................................................................................... 178 Tables Table 1 Table 2 Table 3 Table 4 Table 5 Table 6 Table 7 Table 8 Table 9 Table 10 Table 11 Table 12 Table 13 Table 14 Table 15 Table 16 Table 17 Table 18 Table 19 Table 20 Table 21 Table 22 Table 23 Table 24 Table 25 Table 26 Table 27 Table 28 Table 29 Table 30 Table 31 Table 32 Table 33 Table 34 12 Defining infrastructure ........................................................................................................ 26 Approximate length of road networks in South Africa..................................................... 35 Extent (km) of proclaimed provincial road network, 2000 ............................................... 36 Uses of coal in 2000.............................................................................................................. 45 Summary of the number and capacity of power stations in 2002 .................................... 47 Refineries in operation in South Africa .............................................................................. 49 Licensed renewable energy systems producing electricity ................................................ 79 Summary of energy infrastructure funding ....................................................................... 80 Details of Water Boards ....................................................................................................... 83 Water and sanitation, budgeted capital expenditure by municipal group, 2002/03 ...... 86 Budgeted capital financing by source (all municipal services), 2002/03 ........................... 87 Capital expenditure by Water Boards ................................................................................. 87 Distribution of satellite infrastructure in South Africa ...................................................... 90 Outlook for telecoms sector capital investment, 2003 - 2012 ........................................... 95 Business performance of Spoornet’s three operating divisions, 2001/02 ....................... 104 South African port characteristics ..................................................................................... 106 ACSA airport statistics for the year ending March 2004.................................................. 107 Licensed Eskom power Stations, 2002 .............................................................................. 109 Licensed Municipal power stations, 2002 ......................................................................... 110 Licensed private power stations, 2002 .............................................................................. 110 Eskom transmission system ................................................................................................ 112 National electricity distribution system, 2002 .................................................................. 113 Change in status of electrification over time ................................................................... 115 Annual new connections and annual expenditure .......................................................... 115 South African liquid fuel refineries................................................................................... 117 Water Boards and the populations and municipalities that they serve ......................... 123 Distribution of irrigation capacity in South Africa........................................................... 123 Software spending categories ........................................................................................... 125 PCs sold in South Africa in 2004 ........................................................................................ 126 Fixed line service providers and their installed infrastructure base in South Africa, 1998 - 2004 ......................................................................................................................... 128 Total fixed line capital expenditure by Telkom, 1998 - 2004 ........................................... 128 Projection of fixed line infrastructure investment, 2004 - 2009...................................... 129 South Africa’s satellite infrastructure ............................................................................... 131 1996 and 2001 Census categories...................................................................................... 143 THE DBSA INFRASTRUCTURE BAROMETER Table 35 Table 36 Table 37 Table 38 Table 39 Table 40 Table 41 Table 42 Table 43 Table 44 Table 45 Table 46 Table 47 Table 48 Table 49 Table 50 Table 51 Table 52 Table 53 Table 54 Table 55 Table 56 Table 57 South Africa and provinces: Households with access to piped water, 1996 and 2001 ..........144 South Africa and provinces: Main types of water source used by households (percent), 2001 ............................................................................................... 146 South Africa and provinces: Households with access to sanitation, 1996 and 2001 .............147 South Africa and provinces: Main types of toilet facility used by households (percent), 2001 ............................................................................................... 148 South Africa and provinces: Households not using electricity as an energy source for lighting, 1996 and 2001 ............................................................. 150 South Africa and provinces: Main types of energy source used by households for lighting (percent), 2001 ............................................................. 151 South Africa and provinces: Households with access or nearby access to telephones, 1996 and 2001 ................................................................................ 152 South Africa and provinces: Main types of telephone used by households (percent), 2001 ............................................................................................... 153 South Africa and provinces: Mode of travel in urban areas expressed as percentage of workers and scholars, 2001................................................................... 154 South Africa and provinces: Mode of travel in rural areas expressed as percentage of workers and scholars, 2001................................................................... 155 South Africa: Access to services, number and percentage of households, 2003 ............ 157 Municipalities used in the modelling exercise ................................................................. 166 Summary of water, sanitation and electricity access to services (2004 estimates) ......... 167 Capital grant allocations in national budget (R million, nominal) ................................. 171 Sources of capital (R million, real, constant 2003/04 prices)............................................ 171 Estimates of municipal operating revenue sources (R billion) ........................................ 172 Subsidy allocations to local government (R billion) ......................................................... 173 Levels of surplus generated from high-income consumers (percent) ............................. 174 Relative trends relating to aggregated municipal services operating accounts (percent) ............................................................................................ 174 Predicted capital expenditure over 10 years for each type of municipality (2005/06 to 2014/15)........................................................................................................... 176 Percentage of households per area type earning less than R38 400 per annum........... 184 Percentage of households by area type, 2001 ................................................................. 185 Rate of increase in the number of households between 1996 and 2001 ....................... 186 PART III KEY HOUSEHOLD SERVICES INDICATORS .................................................209 Note on the Key Household Services Indicators ....................................................................................... 211 Contents......... ............................................................................................................................................. 212 CONTENTS 13 Executive Summary The DBSA Infrastructure Barometer addresses both economic and municipal infrastructure in South Africa. The first part examines the four key economic infrastructure sectors, i.e. transport, energy, water and sanitation, and information and communication technology (ICT). The second part takes those sectors to the local or municipal level and deals with access to roads, electricity, water and sanitation, and telephones. The third part contains a comprehensive set of data on access to municipal services. The Introduction provides an overview of the economic and social roles of infrastructure in South Africa. Studies have found a strong correlation between the availability of infrastructure and aggregate economic growth and they also indicate that investments in infrastructure appear to lead economic growth in South Africa. Electricity was singled out as the sector with the largest and most significant impact on economic growth. Part I starts with an historical overview of the growth and development of the key infrastructure sectors, and indicates how the country’s infrastructure development was both dependent on, and at the same time has facilitated, economic development. The history of the energy sector illustrates how economic development hinged on this important resource, and how the development of the mining industry stimulated the development of national infrastructure. South Africa’s water scarcity has always influenced development, and successive governments have expended much legislative effort and funding on clarifying water use rights and building infrastructure to manage this scarce resource. Transport networks are the country’s “arteries” connecting people, industries and ports, and there has always been an emphasis on transport for economic development. Since 1994, however, more attention has been devoted to transport as a tool for social development. Each of the four key sectors has its own character and set of issues. Transport is a complex sector with many modes (road, rail, sea, air and pipeline), several delivery agents and an array of delivery mechanisms. While ACSA airports and the national road network have been successfully reformed and are performing well, urban and freight rail, metropolitan public transport, and the renewal and maintenance of provincial roads are areas where delivery has generally deteriorated over the last 10 years. Abundant coal reserves have enabled South Africa to enjoy one the cheapest sources of electricity in the world. Since 1994, the main focus of national policy has been towards improving access to energy, and provision of an environmentally sustainable future for South Africa. Given the uneven distribution and high seasonality of rainfall in most parts of the country, the availability of a reliable source of water has always been an absolute priority. Since 1994 the entire water sector has benefited from a policy and legislative overhaul which addressed the severe inequities of the past and produced state-of-the-art water resources management. Water services have also been addressed and the new policies have been accompanied by massive fiscal injections to speed up the delivery of basic services throughout the country. The sector has demonstrated considerable achievement over the last decade; but many challenges remain. It is only over the past decade that the ICT sector really gained momentum. The world-wide web became available in 1993, and the first cellular networks were launched in 1994. ICT differs from the other three sectors in that it is characterized by mostly private sector (and parastatal) service delivery providers; and it is not constrained by physical boundaries, although it must comply with local policies. ICT consists of information and communication technologies, radio and TV broadcasting, mail services and networks. Many of the typical ICT components are rapidly converging into smaller, user friendly mobile devices that transform the way we work, transact and play. Taking the four sectors together, we can observe a number of common constraints, each of which is discussed in detail in the conclusions to Part I: • Infrastructure delivery suffers as a result of institutional and capacity constraints • Infrastructure assets need to be maintained, but is there sufficient capacity? • Inefficiency of operations and of regulatory mechanisms continue to hamper rather than support infrastructure development • Environmental consequences remain paramount especially in the energy, transport and water sectors. Part II focuses on access to municipal infrastructure services. It reviews the available data, examines projections for infrastructure investments and identifies many of the challenges related to improving access, 14 THE DBSA INFRASTRUCTURE BAROMETER especially for the poor and marginalised. These challenges are grouped into three areas: financial, social and institutional issues. Without doubt South Africa has made great strides in addressing the infrastructure dimensions of the socio-economic legacy of apartheid. Statistics vary, as described in Chapter 4, but the general picture is overwhelmingly positive as indicated by changes between the 1996 and 2001 censuses. National budget allocations have been consistently increased and backlogs are being rapidly reduced, although some concerns have been expressed over the sustainability of the municipal infrastructure being installed. Future growth and development will depend not so much on the rapid roll out of infrastructure itself but on the sustainable delivery of the services which that infrastructure makes possible. Government has committed itself to an ambitious investment programme with specific targets and timeframes for water supply, sanitation and electricity. Chapter 5 reports the interim results of the financial modelling for the proposed roll out which was undertaken by the DPLG in partnership with DBSA as part of a review of the MIIF. This work aims to inform future budgetary allocations for the Municipal Infrastructure Grant (MIG) and the equitable share of national revenue allocated to the municipal sphere. Taken together with the NSDP it will also inform government policy and municipal decisions on levels of service (LOS) that should be adopted to ensure sustainability. The scenario incorporating government’s current targets was modelled in detail. The financial modelling concludes that the proposed MIG budget allocations for the next few years are adequate but that there is a risk of insufficient funds if a change in policy on housing subsidies excludes the costs of infrastructure. However, the most significant conclusion is that even if the required amounts of capital can be mobilised the real problem is the affordability of operations and maintenance. Under the “preferred” scenario chosen for analysis, the majority of municipalities will have difficulty with recurrent costs, and when budget deficits affect operations and maintenance this may lead to the premature deterioration (or collapse) of expensive assets, environmental damage and it can even retard local economic growth. Even the modest levels of service proposed under this scenario may prove hard to sustain in an environment of low affordability and an obligation to provide free basic services. This highlights the need to explore other scenarios for national policy and for each municipality to undertake detailed infrastructure investment planning to ensure the selection of affordable levels of service. The conclusions above are carried through to the discussion on servicing marginalised communities in Chapter 6. The causes of marginalisation include a legacy of poor service delivery with extensive ongoing backlogs, generally depressed incomes, and problems of location and migration. In addressing these problems, most municipalities face a number of financial, social and institutional challenges in marginalised areas. The ability and willingness to pay of marginal communities has always been problematic. Consumers need to be involved in the choice of LOS to establish what they are willing to pay for; tariff structures must be pro-poor while ensuring sufficient income for the service provider and subsidies must be carefully managed to avoid unintended consequences. There are many social challenges in marginalised communities. The average household size has decreased and new household formation accelerated rapidly between the last two censuses. There is considerable migration between rural and urban areas, some of which is seasonal and circulatory, making planning difficult, and the impact of HIV and AIDS is dire. The pandemic is having serious effects on demographics, household characteristics and incomes, placing a strain on the demand for certain services and reducing the skilled workforce and productivity of service providers. A recurring theme throughout this whole report is the inadequate capacity of service providers to fulfill their responsibilities. South Africa has completely overhauled its legislative, fiscal, regulatory and policy environments to enhance service delivery to the poor and marginalised, but it is now clear that institutional capacity is the primary constraining factor. Delivering new infrastructure and operating it are complex activities but competent skilled persons are in short supply, especially away from the major urban centers. Some elements of public-private partnerships have been introduced to address this but more can be done, with due regard to their regulation. Furthermore, the technical activities of municipalities are dependent on good governance, which is also suffering from a lack of appropriate experience. Addressing the capacity limitations of local government is the greatest challenge facing municipal service delivery in South Africa today. INTRODUCTION 15 16 THE DBSA INFRASTRUCTURE BAROMETER Introduction Background The Development Bank of Southern Africa (DBSA) strongly holds the view that infrastructure is a means to an end. Therefore, in the context of development, the provision of infrastructure is about improving people’s quality of life through sustainable economic growth and equitable distribution of the benefits of that growth. The key to such sustainability is economic diversification and the mitigation of risks to the natural environment. Thus, if the infrastructure is purposefully managed and financed to deliver the services where or when the economy requires or people need, at prices affordable to both the economy and the individual, then development is more likely to be attainable. This requires institutions that are responsive to their constituencies and clients, providing incentives to direct investment and consumption in support of development goals (DBSA, 1998). The purpose of this introductory section is to set the scene for this report by briefly discussing and giving an overview of what role infrastructure plays and the impact it can have for development. Thus it provides key highlights on the evolution of thinking on development and its application to South Africa; describes infrastructure by distinguishing between economic and social characteristics; discusses how infrastructure supports both economic growth and poverty alleviation; and in conclusion, suggests that there is need for greater debate around structural issues. The rest of the report consists of three parts, each containing three chapters, and a separate concluding section. Part I has a chapter on each of the following: a brief historical overview of select infrastructure sectors in South Africa; a discussion on the institutional, regulatory and financial environment which provides context for infrastructure provision and operations; and lastly, to enrich the foregoing sectoral descriptions, maps are provided illustrating the location and scope of the selected infrastructure sectors. Part II also consists of three chapters. The first is a quantitative description of selected household service infrastructure; the second chapter, using a municipal infrastructure investment framework, discusses and illustrates household service and infrastructure options, together with financing implications for eradicating the backlogs; and the last chapter highlights and discusses challenges to municipalities of providing infrastructure to marginal communities. Part III provides a selection of infrastructure, household and other data in different formats. What development? Perspectives on growth and development have shifted markedly over the past 40 years. During the 1950s and 1960s, development was equated with growth in Gross National Product (GNP) or Gross Domestic Product (GDP), with per capita GNP (income per capita) being the preferred index. However, when it became apparent that economic growth did not necessarily lead to a reduction in poverty and a better quality of life for the population at large, analysts re-examined the concept of development. Eliminating poverty and inequality became major objectives, as did reducing unemployment, which was seen as a main element of poverty (DBSA, 2003). The World Development Report of 1991 (World Bank, 1991) described the challenge of development as an improvement in the quality of life. This is significant because the World Bank had earlier propagated economic growth as the measure and aim of development. While emphasising that a better quality of life requires growth in real income, the report states that development also encompasses, as ends in themselves, more equality of opportunity, greater individual freedom and richer cultural life. It also encompasses independence, self-esteem and freedom from ignorance, human misery and servitude. This was explored further in the 1994 World Development Report which highlighted links between infrastucture and development (World Bank, 1994). Achieving these aims, and not just materially through access to growing supplies of goods and services, was seen to determine quality of life. This theme was further elaborated on and discussed in the DBSA Development Report of 1998 as highlighted in the excerpts below: Economic growth. Although economic growth in itself cannot guarantee that development will take place, it is a crucial component of development. Sustainable and equitable economic growth requires structural change in economic activity. This is illustrated by the significance that development thinking accords the relatively faster growth of the manufacturing industry that accompanies a shift of resources out of less productive primary sectors, notably agriculture. However, even industrialised economies experience a continual process of structural change, characterised by sub-sectoral shifts in production (e.g. moving out of textiles and steel into high-tech industries and the service sector). INTRODUCTION 17 Income growth. High per capita income is often associated with economic development, but countries with similar average income levels may have different levels of development. One reason could be inequitable income distribution patterns. Where these patterns are highly skewed, even rapid growth in per capita income may not benefit a large part of the population. Consequently, a reasonably equal distribution of income is an important characteristic of development. Sustainable livelihoods. Development requires that people’s ability to achieve acceptable levels of living, or sustainable livelihoods, be strengthened. Creating secure, well-paid employment is an obvious way of doing this. However, most of the poor in developing countries will never find formal employment, and among those who do, many will earn too little to survive. People’s ability to maintain their livelihoods depends to a large extent on their accumulating and using assets, such as cattle, farming implements, tools for small manufacturing, natural resources and more important, their own labour. The provision of energy, water, sanitation and health and education services enables people to develop their labour and other assets, and is therefore another crucial component of development. Environmental sustainability. Development has close links with the environment. Both extreme poverty, with its lack of growth and development, and prosperity and very rapid growth can affect nature’s ability to sustain people and economic growth. Absolute poverty is often characterised by environmental degradation through deforestation, soil erosion and water pollution. Rapid industrialisation can also destroy the environment through air and water pollution, urban congestion and the degradation of the natural habitat. In both cases, human behaviour and structures conflict with the natural environment. However, sight should not be lost that it is the “world view or approach” (e.g. capitalist accumulation and economic relations) that predicate the form and nature of human behaviour and the structures underpinning it that create and nurture the conflict. Notwithstanding, this implies the need for structural changes to address the fundamental causes of the conflict, but it does not mean that attempts at mitigating conflict situations should be put on hold. Should the latter not be followed, there will be very little likelihood of even minimal improvement in the quality of life or increased opportunity for economic growth. Institutional capacity. Institutions are pivotal to development. They are not merely formal organisations governed by written constitutions, but entail shared understandings, attitudes and customs, interspersed with conflicts shaped by power relations, and they respond to the incentives set before them. Because of this complexity, institutions take time to develop, mature and become sustainable. It was against this changed world view on development that democratic South Africa emerged in 1994. The new government had an overwhelming mandate to transform and reconstruct the country – to create the conditions for poverty eradication and sustained prosperity – in short, to assure equitable and sustainable development. This vision was captured in, and given initial effect by, the Reconstruction and Development Programme (RDP). However, in terms of practical politics, the government was faced with the very real problem of making choices and trade-offs when addressing the issues of a stagnant economy versus the demands of large-scale unemployment and mass poverty. Due to these early prevailing conditions, growing the economy and ensuring macro-economic stability were therefore the chosen imperative. The GEAR policy placed considerable emphasis on fiscal discipline and determined South Africa’s development trajectory. As a result of the interventions, the country’s economic growth has improved. However, due to the tightly reined-in rate of public expenditure on infrastructure and the provision of public services, infrastructure provision and services availability continue to lag when compared with countries at a similar stage of development. In point of fact “investment per capita fell from R1268 in 1976 to R356 in 2002 (1995 prices) - a collapse of 72%” (Bogetic and Fedderke, 2005). Investments clearly need to both accelerate and expand if the full potential for growth in the economy is to be harnessed. 18 THE DBSA INFRASTRUCTURE BAROMETER Figure 1: Infrastructure investment as a percentage of GDP PG(%1 1SJWBUFCVTJOFTTFOUFSQSJTFT 3COJO Box 1: South Africa’s infrastructure and economic growth .VDIPGUIJTXBTVOFDPOPNJD .VDIPGUIJTXBTVOFDPOPNJD "QBSUIFJESFMBUFE "QBSUIFJESFMBUFE TFMGTVGmDJFODZBOE TFMGTVGmDJFODZBOE iTUSBUFHJDwQSPKFDUT iTUSBUFHJDwQSPKFDUT iPWFSJOWFTUNFOUwCZ&TLPN iPWFSJOWFTUNFOUwCZ&TLPN &DPOPNJDJOGSBTUSVDUVSF (FOFSBMHPWFSONFOU3CO 1VCMJDDPSQPSBUJPOT3CO 3CO 4PDJBMJOGSBTUSVDUVSF3COJO TTTTTT Figure 2: Gross capital formation compared to growth (SPTTDBQJUBMGPSNBUJPO (SPTT$BQJUBM'PSNBUJPO BTPG(%1 During the 1960s, South Africa’s growth in gross capital formation (investment in social and economic infrastructure as well as private business enterprise) as a percentage of GDP mirrored economic growth (Figures 1 & 2). Subsequent to the 1960s, trade sanctions against South Africa began to take effect and, notwithstanding continuing investment in economic infrastructure, economic growth declined. During the 1970s, much of the “balloon” of apartheid economic investment was aimed at selfsufficiency. During the next period, the rates of both investment and economic growth had dropped dramatically and, by the mid-1990s, had reached an all-time low. This trend is reversing and both investment and economic growth are increasing. However, matching the economic growth rates of the 1960s will require a significant leap in the rate of capital formation as a percentage of GDP. (SPXUIXJMMCF ESJWFOQSJNBSJMZ BTJOUIFT CZ mYFEJOWFTUNFOU TTTTTT Source: RMB Economics and Reserve Bank Quarterly Bulletin, 2004 The pattern of investment over the past decade has been further skewed by an emphasis on reducing backlogs in basic services, thus minimising expenditure on infrastructure used for economic production. The lack of investment, in particular into electricity is potentially serious “as it appears that this sector exerts the largest and most robust impact on aggregate growth” (Bogetic and Fedderke, p4, 2005). This challenge is now being addressed. For example, both Eskom and Transnet are embarking on the roll-out of massive capital expenditure programmes over the next few years. Refer to Chapter 2 as well as statements by the Minister of Public Enterprises, Alec Erwin, and the Chief Executive of Transnet, Maria Ramos, with regard to corporate rationalisation and expansion of investment in economic infrastructure. Structural issues necessary to gain longer-term efficiencies will however remain, and these challenges are discussed at the end of this chapter. In summary, in addressing development into the second decade of democracy, government has set itself the following two goals (derived from PCAS, 2003): • Increasing the rate of growth above an average of 2.8 percent per annum so that the economy can afford to pay for a better quality of life, and • Addressing the challenges of the second economy – those marginalised people who are unlikely to benefit from an improved rate of growth without government intervention. The first goal, focusing on the growth in the economy, is addressed in Part I of this report through an examination of selected infrastructure sectors, while the second goal focuses on poverty and is discussed in Part II which emphasises reducing backlogs in household infrastructure and services. INTRODUCTION 19 What infrastructure? Four infrastructure sectors were selected for further elaboration in this first Infrastructure Barometer because they are currently central to the debate on growing South Africa’s economy and achieving sustainable development. Transport, energy, water, and information and communications technology (ICT) are all imperative to improving macro-economic efficiency through, for example, reducing the cost of doing business. However, each is also important for delivering outcomes which are imperative to improving the quality of life and increasing workforce productivity. Thus, to explain some of the impacts, a distinction is suggested between economic infrastructure and social infrastructure, based on how each of these two infrastructure categories is characterised and generally understood. Economic infrastructure is that part of an economy’s capital stock that produces services to facilitate economic production or serves as inputs to production (e.g. electricity, roads and ports) or is consumed by households (e.g. water, sanitation and electricity). Economic infrastructure can be divided into three categories: public utilities (electricity, gas, water, telecommunications, sanitation, sewerage and solid waste disposal), public works (water catchment in dams, irrigation and roads) and other transport sub-sectors (railways, roads, seaports, airports and urban transport systems) (DBSA 1998). Government departments responsible for these infrastructure sectors are all involved in activities seeking to promote productive activities of companies and households. Government departments in the economic cluster engage mainly with parastatals and private sector agencies in investment in infrastructure (Department of Finance, 1998; Khosa, 2000). The harnessing of economic potential across the whole country is being attended to with the evolution of the National Spatial Development Perspective (NSDP), creating conditions for inter-ministry and interdepartment alignment and coordination (refer Chapter 6). For example, the Department of Trade and Industry (dti) is creating a complementary framework for encouraging and securing the spatial deployment of productive investment to areas of highest economic potential or, importantly, highest livelihood potential. In specific designated areas, economic infrastructure has been coordinated through the Spatial Development Initiative (SDI) programme. This consists of ten SDIs and four Industrial Development Zones (IDZ), each currently in a different stage of development. To achieve the key objective of economic growth and job creation, there is an emphasis on expanding infrastructure in these delineated areas to improve economic efficiency through reducing transactional costs. In this case, public investment in infrastructure tends to lead further productive investment. Social infrastructure provides services such as health, education and recreation and has both a direct and an indirect impact on the quality of life. Directly, it increases economic activity and employment creation, and indirectly, it enhances broader developmental outcomes. For example, improved productivity is the indirect benefit of improved primary health care, and in turn, improved productivity leads to higher real incomes. Social infrastructure also facilitates investment in human capital by using some of the economy’s physical capital stock to raise productivity of the workforce. The impact on growth is similar to an increase in the supply of capital, and a higher capital-to-labour ratio enables a given number of workers to produce more per capita. Notwithstanding the above discussion, South Africa’s social infrastructure sector is characterised by being largely concerned with the delivery of services to the poor – the bulk of the sector budget is from the national fiscus. Much of this expenditure is administered through provincial and local governments. However, this can be problematic as they do not necessarily have much control or influence over the actual spending of the funds (Khosa, 2000). More coherence of priorities across social infrastructure sectors would enhance coordination and the attainment of improved developmental outcomes within local areas or settlements (Khosa, 2000; Department of Finance, 1998). The Urban Renewal Programme (URP) and the Integrated Sustainable Rural Development Programme (ISRDP), both introduced in 2001, went some way in creating a spatially-defined programme within which these sectors could find coherence and be better coordinated. However, to date, they have met with mixed results (refer Chapter 6). In concluding this section, it is clear that it is not only the type of infrastructure that is important but also who takes the initial and ongoing responsibility, as well as the institutional arrangements necessary to give all this effect. There needs to be coherence and coordination both vertically and horizontally across and between spheres of government and departments. The current debate in the Financial and Fiscal Commission (FFC) on the need to place funds at the disposal of local governments to enable them to undertake responsibilities (e.g. housing and transport) which up until now have not clearly been theirs (but can be argued should be), is part of this realisation. 20 THE DBSA INFRASTRUCTURE BAROMETER How infrastructure supports development Several studies and reports (World Bank, 1994; DBSA, 1998; Bogetic and Fedderke, 2005) have suggested that there is a positive association between infrastructure and a country’s level of development. The economies of developed countries generally have a sophisticated infrastructure which supplies services that sustain their efficiency and competitive advantage. Clearly, the economic link is important but should not be emphasised to the detriment of either the social or institutional dimensions. Infrastructure provision affects, and is affected by, both the level of economic development and its change over time. Economic development is characterised by structural change, that is, the diversification of economic activity. Such diversification entails changes in the relative importance of individual sectors, industries or groups of industries within an economy. A developed economy typically has a broad economic base with high-productivity activity in advanced, high value-added manufacturing and sophisticated services. However, such diversification, although a necessary condition for sustainable growth and development, is insufficient to ensure it. Diversifying an economic base entails a series of changes in the relative importance of categories of economic activity. Infrastructure services play an important role in this pattern, supporting growth in economic output, opening up opportunities for poor people and contributing to environmental sustainability. It would, however, be incorrect to read a deterministic linear pattern into the process of economic development, as one stage does not necessarily follow on from another. Neither can it be categorically stated that infrastructure necessarily needs to lead development, or alternatively, that it should await concrete demand signals and thus lag behind productive investment decisions. What is true is that infrastructure provision needs to be sensitive to context in order to most effectively enable and support the translation of productive investment into efficient economic growth and equitable development. Historically, there have been shifts over time in infrastructure spending across sectors (shown graphically in Chapter 2). As an example, the development of railways was a dominant trend at the turn of the previous century, while at the turn of this century, ICT had become an important technological focus. This raises fundamental questions as to how government and the private sector should prioritise infrastructure for this millennium. It means grappling with shifts in technology, changes in the economy and changing social needs. For example, fixing badly located railway lines because their physical condition is poor may not currently represent the best use of scarce resources. As the economy becomes more global and its manufacturing and service orientation grows, it will be more important that its infrastructure is aligned to enhance national competitive advantage. This may imply a greater proportion of spending on telecommunications, energy, air freight and seaports. Box 2: The Historical Evolution of Infrastructure in South Africa Source: Fedderke, Perkins and Luiz, 2005 quoted in Bogetic and Fedderke, 2005. 200 180 160 140 Index (2000=100) The first wave of infrastructure investment went into railways during the period 1875 - 1930, followed by intercity, provincial and national roads. This was the precursor to the accelerated and sustained growth in road transport which has for some time exceeded that of rail. The last phase is charactarised by investment into electricity and telephony with the myriad challanges and opportunities of ICT being the current important focus. 120 100 80 60 40 20 0 1875 1885 1895 Railway lines 1905 1915 1925 Goods stock (rail) 1935 1945 Paved roads 1955 1965 Electricity 1975 1985 1995 2005 Phone lines: incl mobile In addition to the shifts in economic infrastructure that are precipitated by exogenous factors, demographic trends also impact on infrastructure needs. Whereas overall population growth has slowed, the movement of people from rural to urban areas has continued. Meanwhile, growth in the number of households has INTRODUCTION 21 accelerated due to the formation of smaller households. These have led to an increased need for housing and associated services and infrastructure, especially in the urban areas. The incidence and severity of HIV/AIDS is also a trend that, while not yet well understood, creates new dynamics and pressures for infrastructure and service delivery and management. In examining infrastructure in development, it is clear that there are broadly two types of linkage: the economic linkages between infrastructure and economic growth and the social linkages between infrastructure and poverty alleviation. The following section highlights some of these linkages. Economic linkages - infrastructure and growth In general, infrastructure reduces the cost of production and consumption, and makes it easier for participants in the economy to enter into transactions. Thus, if the efficiency of infrastructure is increased, there should be a concomitant improvement in growth performance, service provision and development outcomes. Overall, this should also result in improved economic competitiveness. However, although important, the efficiency of infrastructure alone is not sufficient, as it also needs to be utilised effectively if economic competitiveness is to be attained and sustained. Recognition should be given to the fact that there need to be shifts in infrastructure sector emphasis and usage, and that careful consideration needs to be given to where to deploy expenditure to achieve the greatest developmental return. In this regard, World Bank research findings, based on cross-country analyses (Leipziger, 2005), have indicated that there is a direct correlation between infrastructure accumulation and growth, as measured by improvements in GDP per worker and growth in infrastructure stocks per worker. Thus, clearly, infrastructure is both essential for and can accelerate growth. Conversely, based on comparative analysis between Latin America and Asia, it was also shown that under-investment in infrastructure has serious consequences for growth and competitiveness, particularly when such holding costs as inventory are taken into account. It is suggested that the availability or absence of the “right” infrastructure often influences the decisions of producers and consumers about where to live or work, whether to produce, and also what to produce. This in turn affects the ability of the economy as a whole to adjust to changes and external shocks. Further, most infrastructure has a fixed location. To use it, producers and consumers must be in the same place as the infrastructure facility. The availability of different types of infrastructure in a particular area often leads to an agglomeration of economic activity in regions, cities and other localities. The effect is enhanced production, consumption and trade, and thus potential competitiveness. When compared with countries of similar development level, South Africa continues to lag behind in its investment in infrastructure. The result of this is clearly illustrated by the findings of the recent IMD World Competitiveness Yearbook which indicates that, although South Africa moved up three places in the rankings to 46 out of 60, its competitiveness remains very low. This is a composite index of which infrastructure is only one indicator. For infrastructure, the ranking is 58/60, which again is a composite reflecting the individual rankings of different kinds of infrastructure. Basic infrastructure provision ranks the best at 51/60. All the various types of infrastructure rated and taken together are critical to enhancing productivity growth. This further underscores the imperative for South Africa to both accelerate and expand investment in infrastructure. Social linkages – infrastructure and poverty alleviation Developmental infrastructure concerns more than just economic growth and diversification. One measure of its empowering effect is its contribution to reducing poverty. The vulnerability of poor people can be countered by redressing low income levels, hazardous conditions, social powerlessness and isolation. Infrastructure has considerable potential in this regard. For example, energy provision can ensure a better work and study environment, access to information through the media, and more time for productive activities. As another example, improved transport provides access to markets, employment opportunities, social and medical services, education opportunities, and friends and family. However, infrastructure provision does not inevitably contribute to the eradication of poverty. Ill-designed infrastructure could have more costs than benefits for poor people because of inadequate targeting or adverse social, health, financial and environmental effects. Infrastructure provision can also widen the gap between poor and non-poor people when access to services is expensive, or where infrastructure services were not planned specifically around the needs of the poor. Delivery can also be disempowering if it turns the poor into passive recipients of services rather than central actors in their own development. 22 THE DBSA INFRASTRUCTURE BAROMETER International and South African case studies show that the contribution of infrastructure investment to the eradication of poverty is influenced by the way in which the investment and subsequent services are planned and managed. In short, to reduce poverty, public investment must reach poor people with the right mix of services, involving them in a way that ensures sustained improvement in their quality of life and contributes to their own economic empowerment. A concluding comment – reforming the role of government This report does not address structural reform in significant detail. It focuses rather on a snapshot of infrastructure condition and constraints to provision within the present environment. It would, however, be negligent to avoid the ongoing debate about the structural conditions necessary to achieve enhanced service delivery. In the past, the neo-liberal view centred simply on the need to privatise part of the public sector delivery chain, and it was assumed that this would be a necessary precursor to improved service delivery. The debate has moved considerably from this position and now reflects on the role of the state in managing service delivery, whether by the public or private sector. It questions the traditional public sector model and introduces an approach which considers the natural monopoly tendency of many services provided by the state, the structure of the state apparatus and also the more careful or calculated involvement of the private sector (Batley and Larbi, 2004). In every sense, it is a more cautious approach. Designing and presenting options for structural reform is therefore an important topic and its urgency will be all the more evident if government is to enhance spending on infrastructure. Getting the most from resources devoted to infrastructure provision, whether public or private, cannot be independent from the regulatory, structural or competitive environment that exists in each sector. Infrastructure spending will not transform sectors that suffer from forms of entrenched inefficiency. Capital investment by monopoly parastatals to modernise and expand their infrastructure capacity will only be truly developmental once efficiencies in operation are evident. Evidence from other countries suggests that continued protection of state-owned monopolies, irrespective of the emphasis placed on improving internal efficiencies limits the effectiveness of service delivery. For many nations, this has implied full or partial privatisation, with a chequered history of both considerable success and dismal failure. In the light of the new debate, structural reform should now be regarded as a reassessment of the public sector delivery chain. For each sector or sub-sector, this may require formulating innovative responses to enhance and incentivise delivery. Where the private sector is involved, it may require a carefully considered approach to regulation in the public interest. Where the public sector is involved, it may involve structural reform to incentivise public agencies to be more delivery-oriented. In the case of the South African parastatals, the purpose of such structural reform should be to reduce their natural monopoly tendencies. This could occur through separating activities into distinct, more manageable and often less monopolistic entities, creating transparency and shifting into the private sector those elements of the business that would benefit from more direct forms of competition (Kessides, 2004). These reforms would need to be sustained by greater independent public sector regulation. It is easier to regulate separate parts of a business that provide intermediate outputs than to regulate a monolithic monopoly. Such monopolies are able to hide behind their own presentation of business characteristics such as capital spending, cost recovery, efficiency, pricing and customer delivery. In the case of conventional government, the purpose of structural reform would be to place emphasis on fast-tracking the delivery chain. It would consider the nature of the bureaucracy, the capability of delivering within the present environment and the incentives created to maximise effective delivery (Batley and Larbi, 2004). Such approaches may see the establishment of specialist state agencies with clear delivery objectives and a more commercial focus. A critical component would also be to create an environment to attract and retain the necessary skills base. Involving the private sector to enhance delivery may require a different approach, dependent on the nature of the competitive environment that is created (Gonenc and Nicoletti, 2001). The first case would recognise those components of public services that could be competitively provided by more than one private sector entity. These are likely to be the operational components of delivery, such as providing transport, telecommunication or other services to customers. INTRODUCTION 23 The second case would be in respect of activities with strong natural monopoly tendencies. These would tend to be, but not limited to, the more infrastructure-dominant parts of shared networks, such as the telecoms, electricity, road or rail networks. Here, infrastructure could be provided by the private sector, but within contractual constraints of state control and more often than not through a process of competitive bidding. This is more closely aligned to the more traditional approach to public private partnership (PPP) involvement of the private sector, such as is provided by Treasury’s PPP unit. In either case, the involvement of the private sector needs to be linked to effective structural reform within the public sector. This is, perhaps, one of the principal lessons of the ongoing debate. 24 THE DBSA INFRASTRUCTURE BAROMETER INTRODUCTION 25 Table 1: Defining Infrastructure PRIMARY FOCUS AREA 26 SECONDARY FOCUS AREAS TRANSPORTATION AVIATION RAIL ROAD MODAL TRANSFER PORTS & PIPELINES Infrastructure related to the process of transporting goods, people etc. Airports and related infrastructure and aircraft catering for air transport (e.g. airside and landside facilities, air traffic control equipment, etc). Railway lines and related infrastructure, and rolling stock catering for rail transport (e.g. stations, marshalling yards, signalling equipment, etc). Roads and related infrastructure (e.g. drainage systems, tunnels, bridges, parking areas, purchasing of land for servitudes, etc) and motorised vehicles to cater for land surface transport. Infrastructure (not included elsewhere) related to the means of transferring goods, people, etc from one mode of transport to another (e.g. bus- and taxi-ranks). Ports, pipelines and related infrastructure and sea-going vessels catering for maritime transport (e.g. harbours, docks, terminals, waterways, oil and gas pipelines, etc). ENERGY CONVERSION TRANSMISSION DISTRIBUTION Energy conversion, transmission and distribution/transport using different primary energy sources (e.g. coal, hydro, wind, solar, gas, steam, bio-diesel, wave power, nuclear, etc). Generation and/or storage of energy and fuel using different primary energy sources. Bulk transmission and transport of secondary energy and fuel of different types Distribution or reticulation of energy and fuel to different types of end-users. Examples of these market operations are independant filling stations and the Regional Energy Distributors (RED). WATER & WASTE WATER WASTE WATER ON-SITE SANITATION SOLID WASTE Infrastructure related to any service which stores, supplies, purifies, transfers and distributes water, and treats and disposes of waste water and solid waste. Infrastructure related to the provision of sanitation services. Infrastructure related to any service which supplies, stores, purifies, distributes untreated or potable water. (e.g. dams, water purification works, distribution networks, bulk pipelines etc). Infrastructure for collecting and treating waste or waste water. On-site treatment of human waste and sullage water. Infrastructure for collecting, sorting, recycling and disposing of domestic and industrial solid waste (including hazardous waste). INFORMATION AND COMMUNICATIONS TECHNOLOGY (ICT) TELECOMMUNICATIONS RADIO AND TELEVISION BROADCASTING POSTAL INFORMATION TECHNOLOGY Infrastructure related to providing access to information and communication services, including the convergence of voice and/or data and/or image. Backbone and local loop infrastructure for fixed line, cell-phone or cable communications of voice, data or image by utilising microwave and satellite technology infrastructure providing bandwidth for data, audio, visual and internet communication purposes. Infrastructure required for transmission of voice, image and data via airwaves or satellite orbits for broadcasting and data exchange. Infrastructure required for the exchange of physical mail. Provision of the hardware and / or software required to interconnect data processing facilities. SOCIAL INFRASTRUCTURE HEALTH EDUCATION COMMUNITY FACILITIES MUNICIPAL End-user infrastructure related to the provision of services for the benefit of the community. Facilities which facilitate the maintenance and improvement of personal health (e.g. clinics, hospitals, etc). Infrastructure related to an institution for the provision of tertiary and private sector education, including residences and recreational facilities. Infrastructure which provides a service to the communities (e.g. community halls, cemeteries, parks and recreational sports facilities, AIDs orphanages, etc). Infrastructure which provides a service to Municipalities (e.g. municipal buildings, fire stations, licensing offices, depots, plant, etc). URBAN RENEWAL AND HOUSING URBAN RENEWAL HOUSING Rehabilitation and upgrading of infrastructure, buildings and housing stock, as well as neglected and brown field sites related to the renewal of existing urban areas, thereby enabling investment and support to improve the general performance of the urban sector. Revitalising the economic role and safety of the urban area. Any form of formal or informal shelter for low- to middle-income groups. TOURISM PRIMARY INFRASTRUCTURE SECONDARY INFRASTRUCTURE ENABLING INFRASTRUCTURE Primary, secondary and enabling infrastructure associated with tourism. Infrastructure associated with tourism attractions (e.g. natural, cultural, man-made, business, conference, sport, immigration, etc). Accommodation, catering and retail facilities associated with tourism. Tour operator maps and guides. Planning, policy, strategic guidelines, etc associated with tourism. THE DBSA INFRASTRUCTURE BAROMETER PRIMARY FOCUS AREA SECONDARY FOCUS AREAS MANUFACTURING, COMMERCIAL AND RETAIL FACTORIES INDUSTRIAL DEVELOPMENT ZONES LED DEVELOPMENT ENTREPRENEURIAL Infrastructure and support for manufacturing, commercial or retail activities. Production and storage facilities, such as factories, warehouses, etc, linked to Local Economic Development and Industrial Development Zones. Real estate industrial development. Assistance to Municipalities in furthering the role of sectors active in their areas of jurisdiction. Infrastructure supporting small-, micro- and medium-sized entrepreneurs involved in retail trading or in the provision of services in any economic sector, as well as involving physical facilities for the entrepreneurs (e.g. shopping centres, equipment, buildings). RURAL, AGRICULTURE, FISHERY AND FORESTRY OFF-FARM INFRASTRUCTURE ON-FARM INFRASTRUCTURE AGRO-INDUSTRIAL INFRASTRUCTURE MARKETS Infrastructure and support related to rural development and all forms of agriculture. The bulk infrastructure is the entire infrastructure that is associated with a particular project but that is not within the physical boundaries of the project, although essential to it. The infrastructure includes storage dams, access roads, power supplies, water supply lines, etc. This infrastructure is not redeemed in full from the project and is often subsidised. There is normally some kind of cost recovery via levies, etc. This infrastructure is normally not dedicated infrastructure but rather shared infrastructure. The costs are normally fully recovered. This category includes items such as infield roads, major and minor water supply lines, balancing dams, loading zones,orchard development, cultivating the soil, crop irrigation and rearing animals (cattle or game); on-farm pump stations, land preparation, liming the land, foundations for broiler houses, superior genetic material, etc. This is a vast category of infrastructure and would cover everything from large sugar mills, organic fertilizer plants, juice extractor plants, etc, to small local market stalls through intermediaries. Establishment of, management of and access to markets for agricultural produce. MINING INDUSTRIAL MINING MINING EQUIPMENT Support to mining ventures (e.g. establishment of mining infrastructure, equipment, etc). Support through the establishment of mining infrastructure (e.g. quarrying, service infrastructure, shafts, etc). Support with the purchasing of capital items required for mining operations. FINANCIAL MARKETS FINANCIAL INSTRUMENTS The provision of financial support where market failure occurs. The application of a variety of financial derivatives / instruments in order to address client needs (e.g. project/ income bond, municipal bonds, debt recovery / restructuring mechanisms, securitisation measures, credit risk diversification portfolios, etc). ENVIRONMENTAL INFRASTRUCTURE ECOSYSTEM MANAGEMENT POLLUTION MANAGEMENT SUSTAINABLE RESOURCE USE DISASTER PREVENTION MARKETS FOR ENVIRONMENTAL GOODS AND SERVICES The creation, maintenance and rehabilitation of a functioning global environment and its constituent ecosystems in support of sustainable development. Infrastructure that supports the creation, maintenance and rehabilitation of ecosystems and their biodiversity assets, such as the creation of protected environments. Infrastructure that manages and reduces pollution and its impact at a local, regional and global level, such as waste treatment, cleaner production initiatives and infrastructure that leads to the rehabilitation of polluted environments. Infrastructure that supports more efficient and effective means of utilising natural resources such as energy efficiency, waste minimisation and water conservation. Infrastructure that reduces the vulnerability to environmental hazards (e.g. extreme weather events as a result of climate change, coastal and flood protection infrastructure). Mechanisms that generate tangible income streams that reflect the real benefits of environmental goods and services, such as carbon finance. Disclaimer: The Development Bank of Southern Africa regards the above classification of services purely as a contribution to the national and international debate on the “Classification of Infrastructure for Developmental Purposes” and merely uses it as a guideline in supporting development infrastructure. The list is by no means regarded as “complete or accurate” and is regularly updated. TABLE 1: DEFINING INFRASTRUCTURE 27 PART I UNDERSTANDING ECONOMIC INFRASTRUCTURE IN SOUTH AFRICA CHAPTER 1 The Historical Context Chapter 1 places the development of Introduction This chapter provides a historical overview of the development of the four infrastructure sectors selected for in-depth analysis in this report, the sectors being transport, energy, water and sanitation and information and communications technology (ICT). The historical context serves to introduce the reader to the dynamics determining the past development and the current nature of these four sectors. The history of each sector is both unique and intertwined with those of other sectors and key historical events. Figure 3 provides a visual overview of the historical milestones for each of the sectors, and shows how the development of each sector is characterised by a different set of events, happening at different times. The sequence of the presentation is deliberate, with transport representing the basis of infrastructure investment. Transport allows movement of goods and people, reduces operating costs and increases the flow of information. The energy sector, described next, assists the economy to produce goods and services and to move these to markets. Energy is followed by water, South Africa’s scarcest natural resource. Access to water resources ensures food production and clean water supplies to support urban development and industrial production, and to facilitate improved sanitation and health in general. The ICT sector, the youngest in South Africa’s suite of economic infrastructure sectors, is discussed last. The historical context for each sector is described by unpacking the particular sector into its subsectors and describing key processes and events which have determined the current state of the sector. See Figure 3 for a historical overview of significant infrastructure events over the past almost 150 years. This timeline presents all four sectors, and highlights events that were noteworthy and influenced the development of the particular sector at that point in time. This chapter sets the scene for Chapter 2, in which the current policy, institutional, regulatory and financial environments governing the four sectors are discussed. transport, energy, water and sanitation, and ICT infrastructure in a South African historical context. The origins and development of each of these four sectors and their sub-sectors are traced through time. The Union Buildings in South Africa’s administrative capital, Pretoria, Gauteng. PART I CHAPTER 1 31 Figure 3: Infrastructure History “At a glance” Pre 1900 1900 1910 1920 1930 1940 1930s Depression 1871 Diamonds & Kimberley 1886 Gold & Johannesburg 1899-1902 Anglo-Boer War 1910 Union of South Africa 1914 – 18 World War 1 1950 1939 – 45 World War 2 1948 National Party Government Apartheid Laws (e.g. Group Areas Act 1950 & Homeland development) TRANSPORT Pre 1900 1900 – 1930 1930 – 1960 Local road solutions. Widely differing standards of road provision between provinces and municipalities. National Roads Board established, culminating in a Road Fund in 1948 and a shift towards common standards. Ports developed in isolation. Creation of SAR&H. Continued centralised control in ports. Separate early rail systems commenced from coast to the interior. 1859: First railway Primary rail network extended into Sub-Saharan Africa. Demand for branch lines began to be met. Apartheid era “townships” led to calls for fairly massive central government subsidy into both bus and rail commuter systems. No flying prior to 1900 Municipalities constructed own regional airports with, in some cases, military assistance. 1909: First powered flight took place in East London. Civil Aviation Branch of the DOT responsible for international and regional airports. 1934: SAA established. Fuel distribution largely through carrying own fuel. Service stations developed by private sector with inter-city fuel distribution by rail from coastal refineries. Development of SASOL 1 to augment coastal refineries capacity. ENERGY Pre 1900 1900 – 1930 1930 – 1960 Discovery of gold and development of mining sector led to exploitation of abundant coal for electricity production. 1906: Victoria Falls Power Company established to supply power to the mining industry in the Transvaal and Orange Free State 1931: Unlawful Determination of Prices Act; fuel prices to be market-driven. Importing fuel from multinational oil companies. 1923: Eskom started providing power to railroads and non-mining industry. 1945: Industrial development from ferro-metals and aluminium increase demand for electricity. 1922: Electricity Act. Creation of Electricity Control Board & Electricity Supply Commission. 1948: Eskom bought Victoria Falls Power Company. 1882: First electricity power station in Kimberly WATER AND SANITATION Pre 1900 1900 – 1930 1930 – 1960 Separate municipal supplies. Central Government dam building commenced. 1930s: Vaalharts Irrigation Scheme. Bucket latrines in Johannesburg and Cape Town. 1903: Rand Water bulk supplier for Witwatersrand. 1956: Water Act. 1904: Sewerage in Johannesburg. 1950s: Dam building stepped up. 1912: Irrigation Act. 1924: Athlone sewage works, Cape Town. ICT Pre 1900 1900 – 1930 1930 – 1960 1791: First Post Office at Cape Town castle. 1901: Radio service introduced. 1932: First overseas airmail service introduced. 1853: First South African stamp with the figure Hope on triangle-shaped stamp. 1902: First public payphone in Bloemfontein. 1932: First overseas telephone call between Cape Town and London. 1905: “Cullinan” diamond posted to London as ordinary registered mail article. 1936: SA Broadcasting established. 1910: Four main Post Office administrations amalgamated. Before 1950: Radio starts. 1876: First telephone installed in Cape Town. 1924: First overseas radio telegraph message received from London. 32 THE DBSA INFRASTRUCTURE BAROMETER 1960 1970 1980 1990 2000 post 2000 1994 Democratic Government Amalgamation of racial local authorities Demarcation of 284 contiguous municipalities 1976–81 “Independence” of Transkei, Bophuthatswana, Venda & Ciskei TRANSPORT 1960 – 1982 Post 1982 Post 1996 Freeway construction continued in earnest. Homeland policy led to a skewed road system developing. 1982 National Transport Policy Study shifted transport’s role from being supply-driven. New constitution established “concurrent” responsibility and supported continued deregulation. Richards Bay and Saldanha ports developed. Ports continue to operate as an oligopoly. NPA established. Ngqura Port under construction. Trucks became a meaningful means of moving freight. Many freight branch lines closed down in rural areas. SARCC created in 1990 as owner and oversear of commuter rail infrastructure. Taxis now dominant mode of commuter transport. Issues of poor efficiency and decline in asset condition reduce rail’s competitiveness against road freight operators. Advent of larger jet aircraft forced consolidation of primary airports and a reduction in light aircraft movements. ACSA established to operate 9 regional airports on behalf of the Department of Transport. 20% of ACSA sold to private sector in 1998. High levels of investment in South African airports and primary roads. Pipeline network continued to expand, overall capacity protected by the Official Secrets Act. Pipeline network marginally extended to Rustenburg. Portions of the fuel pipeline system converted to transporting gas and Pande gas pipeline installed. ENERGY 1960 – 1980 1980 – 1990 Post 1994 1950s: Development of crude oil refineries to reduce dependence on imports. 1982: Discovery of natural gas at Mossel Bay and development of Mossgas. Commencement of roll-out of National Electrification Programme - led by Eskom. 1950: Sasol formed. 1984: Commissioning of first nuclear power plant at Koeberg. 1998: White Paper focus on social equity and increasing access to energy. 1986: Oil price crisis. 2000: Liquid Fuel Charter with BEE target. 1986: Nuclear fuel enrichment Z-Plant. 2001: Eskom Conversion Act establishes Eskom Holdings as a public company. 1988: BEVA Nuclear fuel fabrication plant. 2002: Restructuring of the distribution industry - EDI Holdings Company. 1995: National Electricity Regulator. 1972: Eskom’s role as central generating authority established. 1973: Oil price crisis. 2004: Sasol gas pipeline from Mozambique. 2004: National Energy Regulator Act (Regulator to be formed in 2005). WATER AND SANITATION 1960 – 1994 Post 1994 Massive dam building increase and irrigation schemes. Legislative overhaul for both resources & services. Formation of 10+ Water Boards. Central Government focus on rural water supplies and sanitation. Investment in homeland rural water supplies. 2001: On-site sanitation emphasis, phasing out all bucket latrines. Homeland “toilets in the veld” often not appropriate. 1986: Lesotho Highlands Water Project Treaty. ICT 1960 – 1970 1970s – 1990s 1990s – 2000 New Millenium Integrated postal and telecom services. Separated postal and telecom services. 1990: Five millionth telephone issued. Mobile commerce and wireless networks - medium and long range radio networks. 1993: Internet - optical fibre and bandwidth. Satellites for communications, broadcasts, navigation and surveillance - downlinks to the subscriber. Privatisation of Telcos (unbundling of Telcos in smaller specialist units). Competition in the fixed line service. Introduction of the Personal Computer- hardware and software. Limited mainframe computers and mini-computers. Fixed-line communications, copper-based and limited microwave. The World Wide Web (CERN, 1989). Satellite communications - base stations and satellites. Introduction of private radio stations. Submarine cables, copper-based. 1974: Post Office Savings Bank. Voice traffic dominates. 5 January 1976: Television started. The beginnings of the Internet. Competition among mobile service providers. Data traffic starting to dominate telecommunication thinking. 31 March 1994: Introduction of mobile telephony, cellular networks. Convergence of computers, cameras and mobile phones. 2003: Telkom listed. Sub-marine cables - optical fibre based. Satellite communications expand. FIGURE 3: INFRASTRUCTURE HISTORY “AT A GLANCE” 33 Transport Background Transport has played a significant historical role in the development of the sub-continent. This section describes transport sector development since the beginning of the 20th Century, with emphasis on changes since 1994. It covers the evolution of the various modes of transport such as roads, rail, ports, airports and pipelines. Details are provided of the more recent policy debate and, specifically, the impact of the 1996 White Paper (Department of Transport, 1996), which continues to provide the core of current policy direction. Urban transport represents a particular challenge and, for this reason, is dealt with under a separate heading. Institutional and financial arrangements and the impact of the regulatory environment are contained in Chapter 2. Early emphasis on expanding particularly the rail network demonstrated the importance of rail in linking emerging urban settlements and in giving access to the developing mining and agricultural areas. Rail provides a cost-effective means of transporting high-volume low-value goods over considerable distances. In so doing, it has played a crucial role in facilitating South Africa’s mineral exports. The development of bulk export terminals at the ports of Richards Bay and Saldanha in the 1970s created dedicated rail and port infrastructure for such purposes. The development of a national road network from the 1930s onwards was followed in the 1960s and 1970s by an intensive public sector financed road construction programme. This helped to consolidate the national road network and provided much of the urban motorway network now heavily relied upon within the major metropolitan areas. In urban areas, transport has also played an important role. It was used to foster the economic development of urban conurbations and was also used to facilitate the separate land use development policies of Apartheid. From 1994 onwards, more emphasis in infrastructure development was placed on social development. Road infrastructure was provided in support of lower-income housing development and increased accessibility to previously marginalised rural areas. Whilst this contributed to the wellbeing of a substantial number of people, it did have the downside that very little public sector investment in “economic” infrastructure in the transport sector has been made since 1994. This has led to a shortfall, particularly in the rail and port sectors, with a consequential negative impact on national competitiveness and growth. Transport Infrastructure Development Road Infrastructure Roads carried approximately 75 percent of freight, in tonnage terms, on the dominant inter-city freight corridors in 2003 (Creamer, 2005). Road-based modes also dominate the inter-city and urban passenger market. Roads are the only means of access to most rural communities. The primary characteristic of the South African road network is the great variance in standards and serviceability that exists within the network – more so than in most countries of the world. This variance is primarily attributable to past fund allocation and the skewed capability of institutional support. The “modern” element of the network comprises high-standard roads, including freeways such as the M2 in Johannesburg which carries in excess of 120 000 vehicles per 24 hours. The other extreme embraces hundreds of thousands of kilometres of dirt/gravel roads, some of which carry traffic volumes of 2 000 vehicles per day (e.g. the Ulundi to Nongoma road) but which, in the main, carry less than 50 vehicles per day, predominantly in deep rural environments. The road network in South Africa can be classified into primary (national), secondary (provincial), and tertiary (regional) rural roads, and urban roads and streets (Table 2). 34 THE DBSA INFRASTRUCTURE BAROMETER Table 2: Approximate length of road networks in South Africa Road Authority Length (km) National roads Percentage split 6 700 1 Provincial roads 357 000 47 Unproclaimed rural roads 221 000 29 168 000 23 752 700 100 Metropolitan, Municipal and other Total Source: National Department of Transport, 2002 South Africa embarked on a considerable roads enhancement programme from the mid-1960s through to about 1978. Much of the emphasis of this programme was devoted to enhancing the primary or national roads network, but also included elements of the dominant secondary, or provincial, roads network. Emphasis was also given to constructing dual-carriageway motorway infrastructure where traffic volumes warranted such improvements. Total expenditure on capital and ongoing maintenance for roads by all levels of Government since the mid-1990s has increased marginally in real terms, although major maintenance and rehabilitation backlogs remain (National Department of Transport, 2002) (Figure 4). Figure 4: Total government capital and maintenance expenditure on roads &YQFOEJUVSF3N Financial year Nominal expenditure (Rm) Expenditure in constant 2000 (Rm) Source: National Department of Transport, 2002 Primary Roads (National Roads) Until the mid 1980s, the emphasis of primary road infrastructure development was on handling traffic demand between the main centres of the country, and the links to neighbouring states. Under the influence of the transport policy studies in the 1980s and 1990s, a new strategy emerged. This strategy was directed towards the promotion of the development of export-related freight movements, both locally and internationally, and also towards improving mobility in metropolitan areas. The necessity for efficient and safe linkages between the main towns and cities of the country did not diminish, but merely assumed a lesser priority. PART I CHAPTER 1 35 The proposed primary road network is very similar in layout to the 1971 network, albeit associated with considerably different standards and overall infrastructure quality. A major institutional change is to increase the nearly 6 700 km under the control of the National Roads Agency (SANRAL) in 2002 to 20 000 km, through the transfer of selected roads from the provinces (Le Roux, 2005; SANRAL Annual Report, 2005). A commercial approach towards the provision of primary roads has facilitated the growth of road provision concessions to the private sector on a large portion of the heavily trafficked primary road network. 2 500 km of road have already been concessioned (Le Roux, 2005) and the SANRAL “twenty ten” plan proposes a further 3 383 km to be tolled over the next five years (SANRAL, 2002). This is expected to grow to a toll road network of 7 000 km once completed (Le Roux, 2005). Rural Secondary and Tertiary Roads Secondary and tertiary roads cater mainly for intra-provincial travel and are, in the main, the responsibility of provincial governments. The predominant characteristic of roads under the jurisdiction of provinces is the vast network of gravel and access roads. The national average for provincial roads that are either gravel or unsurfaced is 83 percent (Table 3). A process of transferring some of the lower level or intra-district roads to district councils is currently underway. Table 3: Extent (km) of proclaimed provincial road network, 2000 Province Surfaced roads Gravel roads Unsurfaced access roads (km) (km) (km) Eastern Cape 6 233 34 718 7 631 Free State 7 070 22 046 20 000 Gauteng 3 487 1 771 2 410 KwaZulu-Natal 7 489 19 347 10 571 Limpopo 6 403 11 866 10 578 Mpumalanga 7 062 10 517 7 479 Northern Cape 5 630 53 725 12 023 North-West 6 723 19 161 10 017 Western Cape 7 172 24 991 7 822 57 269 198 142 88 531 TOTAL Source: National Department of Transport, 2002 While it was possible, even in the face of severe financial constraints, to sustain the quality of the provincial road system of secondary and tertiary roads in relatively consistent condition up until the mid-1980s, it has not been possible to do so during the subsequent period. From this time, the funds provided were barely able to meet basic maintenance requirements, and this had been escalating due to previous financial constraints and also as a result of the ever-increasing age of the network (National Department of Transport, 2002). Severe overloading by heavy vehicles has exacerbated this position, and has led to major structural damage on certain haulage routes. 36 THE DBSA INFRASTRUCTURE BAROMETER A Department of Transport study in 1991 showed that, whereas in 1975 only 17 percent of the countrywide expenditure on roads was needed for maintenance and rehabilitation, this proportion had risen to 52 percent by 1990. This was directly due to the continued deterioration of the overall road network as a consequence of the continuous under-investment in road provision, particularly in the rehabilitation of roads past their economic life-span of 20 years (Mitchell, 2004). This situation has been considerably worsened by the fact that, in constant rand values, total road expenditure on rural roads in 1975 had halved by 1990. These figures relate to the total road network, including national roads, which are generally more favourably positioned financially than provincial roads (largely as a consequence of the contribution of road tolling). This last period of some 10 years probably represents the low point for the provincial roads departments over the past 60 years. The advent of a democratic dispensation in 1994 saw a change from four provincial road administrations and various homeland road administrations to nine provincial road authorities. Bloated personnel establishments, a shortage of skills and a re-allocation of responsibility for various components of the road network continue to present a challenge to road provision agencies in both the rural and urban environments. Since 1994, provincial road planners have recognised that the absence of a road network in deep rural areas constrains delivery of other services necessary for social and economic development of rural populations. New housing projects and other social infrastructure require supporting road infrastructure to accommodate the transport needs which will facilitate social integration of these areas with the broader community. Further features of this era are the involvement of central government in low-volume road provision and the development of emerging contractors. This latter endeavour is promoted through the requirement that a percentage of the work of all large construction and maintenance projects be entrusted to small emerging contractors. The “Moving South Africa” (National Department of Transport, 1998/1999) transport strategy (refer Box 8) suggests that 32 percent of the rural roads to farming areas are in a very poor state, while this proportion increases to 82 percent for rural villages. Another facet of the country’s road activities that has received attention during the past 10 years is the need to “grow” the tourist industry by providing access to tourism facilities, through the provision of adequate road links to the primary network. A crucial but frequently overlooked aspect of transport is adequate signage. Urban Transport Development In this document, the term “urban transport infrastructure” is used to denote infrastructure for the efficient movement of people and goods within developed urban areas. The importance of urban transport infrastructure is emphasised by the fact that by far the greatest proportion of the South African population lives in cities (58 percent in 2001) (DBSA, 2003). Unfortunately, the urban transport infrastructure milieu in South Africa during the past three decades is a story of lost opportunities, caused by a failure to “grasp the nettle” in addressing the burgeoning traffic problem, the poor accessibility of many marginal communities and the challenges posed by South Africa’s inefficient urban form. One of the essential requirements of efficient urban transport is an integrated and efficient public transport system. Efficiency implies using urban public transport modes such as minibus, bus and rail optimally, and matching the capacity provided by these modes with demand levels on various routes and corridors across each urban area. The absence of appropriate institutional arrangements over the past 30 years or more to promote coordinated public transport delivery, as well as grossly inadequate levels of funding, have created car dependence among that portion of the population which can aspire, and afford, to acquire a private vehicle, together with reliance on inadequate, unsafe and dilapidated public transport among those who do not have access to a car (Khoza, 1998). South African cities have emerged from a form of spatial planning which has emphasised separate development. Before 1994, the Group Areas Act (1950) and a form of National Government top-down spatial structuring of cities dominated South African urban development. Public transport usage during this period was high for two reasons. Firstly, there was complete reliance on public transport by low-income township dwellers who, through financial constraints, had no access to private cars. Secondly, a tightly structured urban form meant that commercial retail and industrial areas were all well served by public transport, even though overlapping public transport services were racially delineated and integration was actively discouraged. PART I CHAPTER 1 37 Box 3: eThekwini Transport Authority eThekwini Transport Authority is the first metropolitan-level (local government) transport authority set up under the National Land Transport Transition Act (NLTTA) of 2000. It is assigned all functions and powers relating to transport in the city and represents a key shift towards effective institutional management of the transport function at local authority level. Effective local level institutional control is key to addressing issues of fragmentation in the management and control of transport, wasteful subsidisation, integration between modes and services, control and enforcement of public transport operators and effective management of key supporting infrastructure such as roads. The eThekwini Transport Authority comprises three departments: transport, strategic planning and road system management (www.durban.gov.za/ eThekwini/Services/eta). This enables the integrated management of public transport operations, including outsourcing, contract management, enforcement, customer liaison, planning and service design. The Transport Authority will be responsible for all planning and implementation functions and represents a separate juristic entity with a governing body including the representation of councillors as part of its structure (Peters, 2001). The NLTTA makes allowances for a Transport Authority to have an influence over land use policy and to integrate transport plans with the IDP planning process. However, in reality, the transport and land use functions continue to remain separate. Centralising the decision for the funding and subsidisation of transport within the Transport Authority will ultimately be a key element to allowing the authority to begin making trade-offs between different parts of the services it provides to the public. This represents a considerable ongoing challenge, especially with a lack of clarity on the devolution of powers and with provinces wishing to control some public transport expenditure, such as some components of the subsidy provided to busses. In addition, further challenges remain, such as the effective and sufficient funding of Transport Authorities, the regulation and co-ordination of the involvement of minibus ”taxis” in a more formal public transport service delivery environment. The basis for the devolution of the commuter rail function to metropolitan level is a necessary requirement for effective city-wide integration of public transport. From a transport infrastructure perspective, the constraints emerging from historic patterns of urban form are twofold: • Separate high-density urban townships some distance from the dominant urban economy (1st economy), with integration of these areas often constrained by “buffer zones” in the form of watercourses, major infrastructure lines and industrial areas. • Low-density suburban development characterised by high dependence on private car usage and an associated well-developed supporting road network. The spatial structure of apartheid cities started to change after 1994 (South African Cities Network, 2004). However, the levels of efficiency from an urban transport infrastructure perspective have tended to worsen rather than improve. These more recent shifts in urban form are characterised by the following changes: • The de-densification of commercial and industrial activity, often to areas in closer proximity to low-density suburban areas and to major primary and secondary road infrastructure. A consequence of a shift away from traditional urban centres is that commercial and industrial activity has moved away from the dominant public transport networks, and usually further away from dense township development. • Further extensive low-density sprawl, largely as an extension to existing low-density suburban areas, often in areas where road access was originally good but where development pressure has exceeded the ability of the road infrastructure to cope with the influx of private car users. • The development of low-income housing as an extension to existing spatially marginalised townships. On the basis of one family per plot, this has further exacerbated the ineffectiveness of high-volume public transport modes such as urban rail. This situation has resulted in substantially increased congestion levels, with average travel time to work in Johannesburg having reached 50 minutes in 2003, a 17 percent increase since 1995 (South African Cities Network, 2004). The land use/transport situation is exacerbated by the fact that different levels of government are responsible for land use and transport provision decisions. Little coordination exists between these two primary functions which dictate how and where transport facilities are provided. The Integrated Development Planning (IDP) process, now a legal requirement, partly addresses this historic deficiency, but continues to see land use and transport as separate components. The rapid growth in the minibus “taxi” mode and a decline in both patronage of and funding for urban bus and rail modes, have both created much pressure on the existing road infrastructure. This is exacerbated by little real success in creating a multi-modal urban public transport system, and the emergence of a city form which is incompatible with promoting efficient and integrated public transport. The 1980s saw attention being given to various, and isolated, public transport infrastructure projects to make public transport more attractive to the commuter. These included “pilot projects” promoting “park-and-ride” facilities, improved bus services, modal transfer stations, improved rail stations, many new taxi ranks and a few exclusive bus lanes. Unfortunately, many of these changes occurred without the necessary supporting legislation provided by the National Land Transport Transition Act (NLTTA) and 38 THE DBSA INFRASTRUCTURE BAROMETER without sustained funding to the responsible metropolitan authorities. Many local governments failed to use the strong powers assigned to them by the Urban Transport Act to reduce traffic on congested parts of the road network. This was partly through an unwillingness to increase the costs to road users without providing them with realistic alternative options, and partly through a lack of appropriate funding support to provide improved public transport systems and supporting infrastructure. The bus industry was also in trouble during the mid-1980s and onwards, due to the lack of adequate urban infrastructure, such as busways and good “rural” roads on which to operate. It is an anachronism of public urban transport in South Africa that many commuters travel on a daily basis up to 80 km or more from rural areas to their places of work in cities. This problem still persists today in the northern part of Gauteng Province and in the Northern Cape Province. The major problems for urban transport over the past two decades are inadequate funding and the lack of an effective Passenger Transport Authority in the various metropolitan areas. The exception is the recently constituted eThekwini Public Transport Authority (refer Box 3). The bus industry has historically emerged as a subsidised formal mode of public transport. Its method of operation has not changed significantly since the 1980s. Subsidised bus routes tend to service either suburban areas with high levels of car ownership, as commonly served by municipal bus operators, or longdistance services, originally conceived to support apartheid land use planning, between low density rural and peri-urban areas and commercial centres, such as central business districts (CBD) and industrial areas. Low-income townships within the larger cities were traditionally served by rail and bus services, and it is these services that have been characterisd by a consumer shift from commuter rail to minibus “taxi”. Seventy percent (Department of Transport Annual Report, 2004) of all commuter transport journeys are now made by an only nominally, but not de facto, regulated minibus “taxi” industry, which operates completely outside an integrated public transport system, and often by destructively competing with other more formal modes of transport. The minibus “taxi” industry is still largely informal in nature and operates outside the legal and commercial spheres of the economy. It is widely characterised as being financially unsustainable (although levels of profitability may differ from route to route) due to low barriers to entry, a highly competitive marketplace and a lack of reinvestment into capital assets (Fourie and Pretorius, 2003). Attempts have been made to regulate the industry and Provincial Governments administer the issue of permits to operators. Permit issue should be based on the planning requirements of the NLTTA, but restrictions to the number of permits issued to enhance entry barriers are low, and levels of enforcement are insufficient to make the permit system an effective regulatory tool. A R7.7 billion government programme to recapitalise the minibus “taxi” industry is proposed (Mokopanele, 2005). Ideally, this programme should be used as a catalyst to integrate the minibus “taxi” mode more formally with other public transport service providers, improve safety and reduce destructive competition and overtrading on key urban corridors. Rail Infrastructure State ownership and control of railways began in the 1870s when two pioneer railways in the then Cape and Natal became government property. An Act of Parliament in 1916 merged all railways and ports into a single entity known as South African Railways and Harbours (SAR&H). Railways and ports expanded considerably from that time and, by 1981, were organised into the South African Transport Services (SATS). The Legal Succession to the South African Transport Services Act, 1989, transformed SATS from a government department to a public parastatal company. With responsibility for all rail infrastructure and operations, Spoornet became the largest of eight operating divisions of this company, known as Transnet (Kleingeld, 2003; www.transnet.co.za). As the railways on the sub-continent developed, so the focus of their use changed: • The initial emphasis was access and the development of the sub-continent, with passenger services being an important component of what was otherwise a freight-dominated railway service. • As inland areas began to develop and industrialise, the emphasis changed to a general freight railway, with access to relatively remote areas and where railways moved almost all freight goods and a considerable proportion of passengers. • As the road network developed and private vehicle ownership became more entrenched, railways were focussed on hauling bulk goods over long distances, with high-volume low-cost commodities such as minerals, agricultural products and primary manufactured goods, such as steel and chemicals, being the areas where competitive advantage was sustained. PART I CHAPTER 1 39 There are two implications of this last shift in focus. The first implication, and the partial cause of the shift, was the deregulation of the road freight market in 1988. This removed the protection of rail from road competition (Stander and Pienaar, 2002) and came in the wake of changes in the economy, the provision of a more effective road network and a situation where road freight operators could now compete costeffectively, not possible only a few decades before. The second implication is a consolidation and reduction in the network size which rail was then able to serve. Many branch lines were constructed in the heyday of rail, linking small predominantly rural settlements to the main rail network. With the railways under complete public sector control during this time, many of these branch lines were also created for political rather than economic reasons, and have quickly become redundant as road freight became a more cost-effective mover of smaller freight volumes. The dominance of rail as a freight mode has shifted as the relative cost of road transport has fallen and as the quality of the rail service has declined. A further factor favouring faster, more reliable and flexible road transport is the shifting needs of the economy. There is now stronger emphasis on active supply chain management, with emphasis on reducing goods in transit or in inventory, and with greater emphasis on smaller volumes delivered more reliably to support “just-in-time” production techniques. The result has been a steady shift from rail to road over the last decade, as demonstrated in Figure 5. Figure 5: Tonnages of freight moved by road and by rail 'SFJHIUNPWFEQFSBOOVNNUPOOFT 3PBE 3BJM Source: Department of Transport, 2005b In illustration of this shift, finished goods moved over a distance of 775 km in 1991 were some 15 percent more expensive when moved by road rather than by rail. Six years later (1997), when the same goods were moved over the same distance, rail transport was 15 percent more expensive than road transport (Business Times, 18 July 1999). This rapid shift over a relatively short timeframe is a consequence of the following: • An increase in the allowable road vehicle mass from 48 to 56 tonnes during this period. This was further compounded by vehicle overloading, which is continuously being monitored by the respective road agencies, and more recently, by private sector toll road operators. • A vicious cycle within the rail environment of declining cash flows, which led to under-investment, and a reduction in demand which reduced asset utilisation and increased the unit cost of moving ever-declining freight tonnages. This situation is by no means unique to South Africa and is a worldwide phenomenon, exacerbated by railways that are often bloated and inefficient public sector monopolies that are unable to adjust to shifts in demand. Similar to the decline in the dominance of rail in the inter-city freight market, so rail has also declined as an urban transport mode. Part of the reason for this decline is the flexibility of road services, particularly in responding to new or emerging residential and commercial locations not served by rail. The changing urban 40 THE DBSA INFRASTRUCTURE BAROMETER form of South Africa’s cities has further exacerbated the decline of rail as an urban public transport mode. The decline is also influenced by poor rail service quality, with safety and security being particularly important issues. Commuter rail is also poorly integrated with other modes of public transport. The result has been a steady decline in the use of rail as a public transport mode within urban conurbations, as demonstrated in Figure 6. Figure 6: Patronage of South African commuter rail 1BTTFOHFSTNPWFEQFSBOOVNNJMMJPOT Source: Department of Transport, 2001 and SARCC, 2002 - 2004 In the late 1990s, the commuter rail system was identified as being in extremely poor condition, with much of its rolling stock exceeding 30 years old (National Department of Transport, 1999) and with, in some places, dangerously inadequate signalling systems and permanent way. Rail commuter transport was becoming, in certain instances, dangerous and was losing its attractiveness to the commuter. Since then, the state of infrastructure has further declined and, while an ongoing programme of rolling stock rehabilitation continues, this investment is insufficient to neutralise the negative impact of ageing and inadequately maintained assets. In an attempt to remedy the rail infrastructure problem, the Department of Transport made proposals in 1996 for rail commuter services to be concessioned to the private sector as a means of improving operating efficiency and enhancing customer focus, in a similar fashion to the successful endeavour in Argentina. Unfortunately, this proposal was unacceptable to organised labour and was subsequently shelved. From the 1980s to the end of the century, as the use of road traffic to convey freight grew rapidly, the rail “branch lines”, which were a feature of the early development of the rail network, and which brought a “form of comfort” to many remote villages, became uneconomical. With much opposition from local communities, Spoornet embarked upon a programme of closing branch-lines down, with the consequence that many remote villages suffered economic deterioration. Other villages, however, enjoyed good road access and they survived. With the recent advent of “tourist rail” routes, there has been an expressed interest in the revival of some of these branch lines. From the mid-1980s to very recently, the attraction of rail transport to commerce and industry has waned considerably in relation to road transport. The rail system has gradually deteriorated and, despite its surplus infrastructural capacity on certain lines, it has not succeeded in winning back general freight transport from the road sector. The iron ore and coal lines remain very well used. Many within the rail industry have said much about the “unevenness of the playing field” between rail and road, and attempts are being made to win traffic back to rail. Very recently, in May 2004, Spoornet announced a plan to spend more than R14 billion over five years to upgrade and revamp assets and infrastructure in an attempt to win back customers. The involvement of the private sector in such investments has been clearly articulated by the Transnet Chief Executive who identifies the potential to use public private partnerships (PPP) to spread risk, bring in skills and enhance efficiency (Creamer, 2005). PART I CHAPTER 1 41 Port Infrastructure During the past 50 years or so, port authorities have attempted to match infrastructure supply with demand at all South African ports, rather than analysing the overall logistical approach to the handling of imports and exports. The Moving South Africa (MSA) strategy has suggested a “hub and spoke” approach to the development of port facilities in the country. The proposal envisages two deep-water hub ports for the country, one east-facing and one west-facing, with coastal “feeder shipping” and specialist users serving the remaining ports. Two new ports have been developed during the last 50 years, Richards Bay and Saldanha, while the construction of the Ngqura Port has been initiated in the last two years. Focussing on enhancing economies of scale at South African ports, improving their efficiency and promoting greater levels of specialisation, remain the core issues for continued development of the country’s port infrastructure. The tonnages handled at South African ports (Figure 7) demonstrate the importance of the bulk sector which is largely confined to the export of iron ore and coal through the ports of Saldanha and Richards Bay respectively. While this sector grew at 7.5 percent for the five years to March 2002, it is the 19 percent growth in containerised tonnages over the same period that provides the more substantial challenge to infrastructure upgrade and renewal at South African ports. As is common internationally, the break-bulk sector has slowly declined over the last five years. Figure 7: Tonnages handled at South African ports, 2001/02 $POUBJOFSJTFE NUPOOFT HSPXUIPWFSZFBST #SFBLCVMLDBSHP NUPOOFT EFDMJOFPWFSZFBST #VMLDBSHP NUPOOFT HSPXUIPWFSZFBST Source: NPA, 2005 Airport Infrastructure The Constitution of South Africa mandates “airports” as a function of all three levels of government. However, it is necessary to draw a distinction between airports and aerodromes. Airports are taken here to refer to manned and controlled runways for aircraft, and aerodromes to be unmanned, although licensed, “landing strips”, of which more than 600 exist in the country. This short history of the development of airport infrastructure is restricted to national or state airports, currently administered by the Airports Company of South Africa (ACSA) and previously, jointly by the Department of Transport (DOT) and the Public Works Department (PWD). The PWD was responsible for building and the DOT for the civil and other works. Other than Johannesburg International, the two primary airports in South Africa are Durban International and Cape Town International. Substantial growth in both international and domestic air travel, both having almost doubled over the period 1996 to 2003 (Figure 8), has placed considerable pressure on ACSA to increase the size and quality of infrastructure at airports. It has been widely credited with having implemented infrastructure well in advance of demand, albeit based on a strong revenue stream from air ticket sales. 42 THE DBSA INFRASTRUCTURE BAROMETER Figure 8: Numbers of domestic and international passengers passing through ACSA managed airports 1BTTFOHFSBSSJWBMTQFSBOOVN NJMMJPO %PNFTUJD QBTTFOHFST *OUFSOBUJPOBM QBTTFOHFST Source: Department of Transport, 2001; ACSA, 2005 While significant upgrades at airports continue, it is the proposal to shift Durban Airport to La Mercy that is perhaps the latest potential new airport infrastructure project. There has been repeated pressure by local politicians and others for the construction of the King Shaka Airport, which ACSA has strenuously resisted on financial grounds. The latest proposal from local interests is to combine the construction of an initial freighthandling airport with a “trade port” – the Dube Trade Port. Pipeline Infrastructure Approximately 3 900 km in length for the conveyance of petroleum products, pipeline infrastructure was first introduced into South Africa during the mid-1960s by the then South African Railways & Harbours Administration (SAR&H). In 2004, approximately 14 billion litres of petroleum products were transported annually through the Petronet pipelines. As the products transported are all energy-related products, the topic is more fully addressed in the Energy section of this chapter. The recent completion by Sasol of the Pande to Secunda gas pipeline is starting to change the ownership and primary function pattern of pipelines in South Africa. Energy Background This section provides a historical overview of the energy sector in South Africa over the past five and a half decades. Energy is fundamental to the social and economic development of South Africa. Over the years, the economy has largely depended on mining and highly energy-intensive industries. Of importance has been the shift in policy towards a more equitable, secure and sustainable distribution of energy resources on a national level. However, progress in the various sub-sectors has been diverse, with coal providing the major primary source of energy - and the cheapest electricity in the world. Reference is also made to the strategies engaged to ensure sufficient fuel reserves during the embargo years. Today, South Africa leads the world in converting coal and natural gas into liquid fuels and chemicals. The design of the pebble-bed modular reactor (PBMR) in the nuclear field, and progress in new and renewable forms of energy, are ongoing challenges for the development of the sector. The historical objective of the South African energy policy was to satisfy the needs for energy provision to all parts of the economy at the lowest possible financial cost. In addition, security of supply and balance of payments were considered important to the development of the sector, especially in the 1970s and 1980s. The discovery of gold in the late 1800s and the subsequent development of the mining sector were the initial driving force for the development of the electricity sector, based on cheap and abundant coal. This was followed by the development of the industrial sector and the founding of the steel industry. Later, high PART I CHAPTER 1 43 Box 4: South Africa’s Energy Policy is based on the following key objectives: • Attaining universal access to energy by 2014 • Accessible, affordable and reliable energy especially for the poor • Diversifying primary energy sources and reducing dependency on coal • Good governance which must also facilitate and encourage private sector investments in the energy sector • Environmentally responsible energy provision. Source: Budget speech, Minister of Minerals and Energy, 19 May 2005. electricity demand emanated from growth by large energy-intensive ferro-metal and aluminium industries. Development of the crude oil refineries took place in the 1950s, primarily to satisfy the growing demand for liquid fuels, to improve self-sufficiency and to reduce payments to fuel-exporting countries. In 1950, Sasol was formally incorporated as a state-owned company with the purpose of producing oil from coal, and it established its first plant in the new town of Sasolburg. The political embargo of the 1970s and the oil price crises of 1973 and 1986 led to local nuclear developments (Koeberg) and a huge increase in the capacity of the synfuel industry (Sasol 2 and 3 in the 1970s and Mossgas in the 1980s). Subsequently, the rising concern for social equity led to the initial electrification of households in specific townships from the late 1970s, and the development in terms of the National Electrification Programe by Eskom in the early 1990s. Energy Sector Policy Two White Papers on Energy Policy were published: • The 1986 White Paper The objective of the energy policy was primarily to ensure: • Security of supply • Adequate and uninterrupted provision of energy • Its efficient utilisation, in order to promote optimum economic and social development in South Africa. Limited attention was given to this last objective. • The 1998 White Paper The objectives of the energy policy moved significantly from security of supply to that of social equity. Five specific objectives were formulated and used to develop sub-sector strategies: • Increasing access to affordable energy services • Improving energy governance • Stimulating economic development (including competition, addressing market failures, cost-reflective pricing, transparent subsidies, appropriate energy taxation) • Managing energy-related environmental impacts, and • Securing supply through diversity (including energy trade within the SADC). Sources of Energy One major secondary source of energy is electricity generated in thermal power stations, which takes advantage of South Africa’s abundant coal resources. The other major secondary energy source is petroleum products, refined from imported crude oil. South Africa has very small oil resources and modest natural gas resources which are used on a limited scale. Liquid fuels are also sourced from coal conversion through Sasol and liquefaction of natural gas from PetroSA, the latter supplying about 8 percent of liquid fuel requirements. Initially uranium production was a by-product of gold mining, and used to fuel nuclear power production. Eskom now procures conversion, enrichment and fuel fabrication services on world markets to feed the only nuclear station, Koeberg. Hydroelectric power is generated on a limited scale including a few pumped storage schemes on the Drakensberg escarpment and in the Western Cape. The use of renewable energy sources, mainly biomass in the form of firewood, dung, crop residues and other organic matter, is extensive. It is very difficult to obtain an accurate estimate of total biomass use and reserves. However, it was estimated in 2000 to comprise 8-10 percent of South Africa’s primary energy consumption. In rural and peri-urban areas, biomass is the main form of household energy, used mainly for cooking and heating, but it is often used in an unsustainable manner. Technologies in wind generation are new and there is also limited solar energy production in the form of solar water heaters. Other renewable sources include bagasse and municipal waste or biogas, but their use is limited and still on a small-scale basis. Figure 9 shows the primary sources of energy in 2000. 44 THE DBSA INFRASTRUCTURE BAROMETER Figure 9: Primary sources of energy in 2000 $PBM $SVEFPJM /BUVSBMHBT )ZESP #JPNBTT 6SBOJVN Source: Department of Minerals and Energy Coal Coal is by far the largest source of local primary energy, not forgetting that large volumes of coal are also exported. The coal reserves are mainly bituminous, with relatively high ash content (45 percent) and low sulphur content (1 percent). Recoverable reserves are estimated at 55 billion tonnes, which is the fifth largest in the world and about 5 percent of the total global reserve. The large Waterberg Coal Field, with about 50 percent of South Africa’s resources, is situated in the Limpopo Province close to Thabazimbe. Coal mining is largely a private sector activity, involving large companies such as Anglo Coal, Ingwe Coal (subsidiary of BHP Billiton), Eyesizwe Coal, Kumba Resources, Sasol Mining and Swiss-based Xstrata Coal. South Africa has more than 60 collieries, ranging from small-scale producers to some of the largest in the world, with outputs in the range of 5 000 to 1 million tonnes per month. About 45 percent of South Africa’s coal is mined by opencast methods. The low cost of mining coal led to its extensive use for electricity generation, mineral exports and the development of the large synfuel industry that uses coal as a feedstock. The national consumption of coal in 2000 is given in Table 4. Table 4: Uses of coal in 2000 Use of coal Million tonnes Percent of total Exports 69.2 31 Electricity production 89.3 41 41.7 19 17.6 7.9 2.5 1.1 220.3 100 Synfuels (including chemical production) Direct use in industry Households Total PART I CHAPTER 1 45 The Richards Bay Coal Terminal (RBCT) is the world’s largest coal export facility, with a capacity of 97.4 million tonnes per annum. It handles 95 percent (2001) of South Africa’s coal exports. Other small export facilities are the Durban Coal Terminal (DCT), handling 2.2 million tonnes, and the Matola Coal Terminal in Maputo (MCT), handling 1.4 million tonnes. Coal is transported to these terminals by railway line. The Richards Bay link was upgraded in the 1990s and the Maputo link recently underwent a US$13.8 million upgrade. Conveyor belt, railcar or road trucks transport coal for inland use. The cost of coal transport tends to be very high, thus reducing the use of coal with increasing distance from the coal mining areas. Box 5: Energy and the economy Energy is fundamental for South Africa’s social and economic development. The energy sector contributes about 15% of South Africa’s Gross Domestic Product (GDP) and employs more than 250 000 people. The economy is highly energyintensive and is dominated by mining and primary processing, metal smelting and synfuel production. Energy consumption in South Africa is dominated by industry at 42%, comprising mining, iron and steel, other metals, chemicals, pulp and paper, food, tobacco, etc. Growth in this sector is inevitable and driven by international competition. The transport sector is the next largest energy consumer and mainly uses liquid fuels. Land passenger transport is the largest, followed by land freight and then air transport. Although the commercial sector, which includes financial services, IT, retail, tourism and education, consumes a smaller quantity of energy, the opportunities for energy efficiency are large, particularly in buildings. The agriculture sector includes large modern farms as well as small subsistence farmers. Most energy comes from diesel for modern farming and vegetable wastes for subsistence farms. Finally, the residential sector includes households which rely on electricity and traditional energy such as woodfuel, dung and paraffin. The level of access to electricity in South Africa is among the highest in the region, at 71%. The Government is committed to improving the level of access through its support to the National Electrification Programme. Electricity The electricity industry initially developed around the mines during the late 19th Century, mainly in Kimberley and the Witwatersrand (Conradie and Messerschmidt, 2000; Department of Minerals and Energy, 1992). At that time, it consisted of local distribution systems and a number of small independent power stations. Electricity in municipal areas was initially utilised for tramways and lighting. In parallel with this development, four provinces passed legislation after 1910 concerning the establishment of electricity undertakings in local government areas. The Victoria Falls Power Company (VFP) was formed as a private initiative. Demand by the mines and urban areas increased sharply, and government passed the Electricity Act of 1922, which allowed for: • The creation of the Electricity Control Board (ECB), the first national regulator • Creation of the Electricity Supply Commission (Escom), with wide statutory power to acquire and/or establish power generation and supply undertakings wherever necessary or desirable, and • The requirement for all undertakings to obtain licences for the selling of electricity. Over time, Escom took over the existing undertakings, including the VFP in 1948. Construction began on a national transmission grid at 400 kV in 1969 (Department of Minerals and Energy, 1992). The integrated national transmission system was completed during the 1970s, interconnecting the northern and southern parts of the country. Eventually in 1972, the central generating undertaking of Escom was established and consisted of all non-municipal power stations. During Source: South Africa Energy Profile 2003 this period, a number of smaller and old municipal power stations were no longer cost-effective and were closed down. In 1983, Government appointed the De Villiers Commission of Inquiry (Government Printer, 1984) to investigate tariff policy and structures in the electricity supply industry (ESI). The Commission made a number of drastic recommendations on the institutional structure of the then Escom, its governance, efficiency of operations and tariff policy. The governance of Escom was restructured by means of an Electricity Council (appointed by Government) with a Management Board appointed by the Council. In 1987, Escom was renamed Eskom. The Eskom Act (Act 40 of 1987) did away with the capital development and reserve funds and created the brand name “Eskom” that was no longer an abbreviation for the Electricity Supply Commission. More than a decade later, the Eskom Conversion Act (No 13 of 2001) created the public company, Eskom Holdings Limited, with effect from 1 July 2001. This company is wholly-owned by the State, and for the first time, Eskom became liable for the payment of taxes and dividends, and its borrowings would be secured against revenues and assets and not by Government guarantees. At the time, national government saw this legislation as a first step in commercialising Eskom, and created a public company in terms of the Companies Act with its share capital held by the State. 46 THE DBSA INFRASTRUCTURE BAROMETER Eskom enjoys a practical monopoly in bulk electricity sales. Thus, in 2002, it supplied 96.5 percent of the electricity generated in South Africa (NER, 2002a). It sells electricity in bulk to local municipalities and, since 1994, has been involved in the roll-out of the major part of the national electrification programme. At the end of 2002, it was calculated that 80 percent of all urban households and 50 percent of all rural households had been supplied with an electricity connection (NER, 2002b). However, a review of the programme undertaken in 2001 identified some weaknesses resulting from the low level of consumption per customer, poor recovery of operational costs and the lack of resultant socio-economic development (EDRC/DBSA, 2001). A summary of the generation facilities as a function of primary energy technology is given in Table 5. Table 5: Summary of the number and capacity of power stations in 2002 Type of power station Number of facilities Eskom Coal-fired Municipal Total capacity MW Private Eskom, percent of total capacity 10 7 4 34 668 92 Nuclear 1 - - 1 800 100 Bagasse - - 5 105 0 Hydro 6 3 1 668 99 Pumped storage 2 1 - 1 580 89 Gas turbines 2 9 - 672 51 Mothballed coal-fired 3 - - 3 541 100 - - 1 17 - - - 1 13 - 24 20 12 43 064 92 Biomass under construction (i) Wind under construction (ii) Total (i) Biomass Energy Ventures, 17.4 MW capacity (ii) Darling Demonstration Wind Project, 13 MW capacity Source: NER, 2002a Generation and transmission have been centrally controlled by Eskom. In the distribution arena, Eskom and 188 large municipalities and small town councils play a role. Latest developments include the planned restructuring of the electricity distribution industry (EDI) into six Regional Electricity Distributors (RED). This will consist of a merger between the distribution components of local governments and Eskom on a regional basis. This is the largest industry restructuring process in South Africa for an EDI valued at some R50 billion. The Electricity Restructuring Bill was published in 2002, but the legislation that should be forthcoming is still being debated in Parliament. In 2003, EDI Holdings Company was formed, and is responsible for all planning and functions of this process. The first RED will be established in Cape Town during 2005. The Electricity Restructuring Committee in 1996 recommended that the entire industry should move towards cost-reflective tariffs with separate and transparent taxes to fund electrification. In 2000, Cabinet accepted a policy for free basic services. Paraffin was zero-rated for VAT in mid-2001. In 2002, the DME introduced “free basic electricity” in the form of pilot projects for a number of selected areas. This consisted of the first 50kWh of consumption in each month being supplied free to “qualifying PART I CHAPTER 1 47 households”, as defined by each respective local authority. This policy was implemented nationally in mid-2003 with the intention of cross-subsidising this cost with higher use customers. It has been implemented by all distributors, that is, Eskom and municipalities. Liquid Fuels The liquid fuel industry started with the import of refined products and local marketing late in the 19th Century. By the 1920s, a number of multinational oil companies, such as British Imperial Oil Company (now Shell), Vacuum Oil Company (now Mobil) and Texaco (now Caltex), were selling liquid fuel products in South Africa. In response to cartel-driven prices, the Government passed the Unlawful Determination of Prices Act of 1931, with the aim of leaving price determination to market forces. This Act was amended in 1937 and made provision for regulated prices of fuel that was sold by approved filling stations only. Subsequent Acts and policies swung between regulation and free market principles, and this remains the situation today. The first oil refinery was constructed by the Standard-Vacuum Oil Company (later split into Mobil and Exxon) in Durban and commissioned in 1954. In 1963, Shell and BP joined forces to erect a second refinery in Durban. The Caltex refinery was erected in Cape Town in 1966. The oil companies financed these developments privately. In 1950, the South African Coal, Oil and Gas Corporation (Sasol) was formed to produce oil from coal at Sasolburg. By 1971, Sasol joined forces with the Iranian National Oil Company and Total SA in refining crude oil at the new Natref Refinery in Sasolburg. Following large global oil price increases and sanctions on South Africa in the 1970s, Sasol was extended with additional plants to increase the production of synfuels. Thereafter, Sasol was privatised and is now listed on the JSE Securities Exchange (Sasol Limited, 1979). The South African Government founded Soekor in 1965 to initiate an oil and gas exploration programme. Initial inland exploration yielded no results and was abandoned in 1978. In 1982, a major discovery of natural gas was made off-shore from Mossel Bay. Development of the Mossgas liquid fuel refinery was approved in 1985 and required funding of about R12 billion for the 45 000 barrel per day facility. Mossgas was funded through the Central Energy Fund (CEF) by means of commercial loans and a levy on liquid fuel sales. Mossgas merged with Soekor in 2002 to form PetroSA. Together with Energy Africa and Pioneer, PetroSA owns and operates the limited amount of oil reserves on the south coast (Oribi/Oryx fields and the Sable field in the Bredasdorp Basin), with proven reserves of 49 million barrels. Sasol’s 15th oxygen plant at Sasol Synfuels operation at Secunda During the embargo years, Government created the CEF out of the activities of the Strategic Fuel Fund (SFF) that was housed at the Industrial Development Corporation (IDC). The Fund also housed the Strategic Oil Fund Association. CEF constructed a number of storage tank farms at Saldanha, Durban, Milnerton and Ogies as strategic stocks of fuel, sufficient to last the country for up to two years. Crude oil and refined products were transported by rail until 1962. In that year, a 700 km pipeline was constructed from Durban to the Witwatersrand. 48 THE DBSA INFRASTRUCTURE BAROMETER The liquid fuel sector is highly regulated in terms of retail price maintenance and limitations to vertical integration. Government signed the Liquid Fuel Charter with industry in 2000. The Charter states that 25 percent of the equity of the sector needs to be in empowerment hands by 2010, and only then will attention be given to the deregulation of the sector. Other new targets include the removal of all lead from petrol and the reduction of sulphur in diesel to a maximum of 0.05 percent by 2006 (also see Box 9 on page 75). Today, the Petroleum Agency of South Africa (not to be confused with PetroSA, the producer of liquid fuel from gas, as described above), is the regulator and marketer for the exploration of oil and gas resources. The International Petroleum Encyclopaedia 2001 reports South Africa’s reserves as 29.4 billion barrels for oil and 780 billion cubic feet for gas. Table 6 gives a summary of refineries in the country. Table 6: Refineries in operation in South Africa Refinery Location Capacity (barrels/day) 1992 Ownership 2002 Sapref Durban 120 000 165 000 BP 50%, Shell 50% Genref Durban 70 000 105 000 Engen Calref Cape Town 50 000 100 000 Caltex Natref Sasolburg 78 000 86 000 Sasol Secunda 150 000 150 000 PetroSA Mossel Bay 45 000 45 000 513 000 698 000 Total Sasol 64%, Total 34% Sasol Central Energy Fund Natural Gas PetroSA owns the only gas field in production, with an estimated reserve of 1 trillion cubic feet (tcf), located south of Mossel Bay. This supplies the Mossgas synfuel plant that produces petrol, diesel and paraffin. South Africa also has sizeable reserves of coal-bed methane of about 3 tcf in the Waterberg and Perdekop region, and these have not yet been exploited. Sasol Gas markets and distributes both hydrogen- and methane-rich gas produced from coal at Sasolburg and Secunda respectively (Sasol, 2003). The company delivers pipeline gas through a 1 550 km pipeline network to more than 500 industrial and commercial customers in Gauteng, Mpumalanga, Free-State and KwaZulu-Natal. More than twenty years ago, Sasol developed the distribution networks in Gauteng/Mpumalanga and the assets have since been written off (Greeff, 2004). The replacement cost is estimated at R2 billion. In the late 1990s, Sasol researched the piping of natural gas from Mozambique as a feedstock for its existing synfuels plants. This project started in 2002 and involved the development of the Pande and Temane gas fields in Mozambique and the construction of an 865 kilometre pipeline to Secunda. The line commenced operation at the beginning of 2004. The cost of this project was $1 200 million of which Sasol and the governments of South Africa and Mozambique are the major shareholders in the pipeline component (Greeff, 2004). Nuclear Energy The success of the pilot enrichment programme by the Atomic Energy Corporation (AEC), the euphoria with nuclear energy in the global power sector in the 1960s and 1970s, the potential of cost-competitive power generation, and the diversification from the concentration of coal fired electricity generation in the north of the country, were all factors that contributed to the decision to construct the Koeberg Nuclear Power Station close to Cape Town. The decision to build the 1 840 MW pressurised water reactor (PWR) Koeberg power station was taken in 1974, with the first reactor being commissioned in 1984. The actual cost of Koeberg remains unknown, although Eskom calculated its net present value between R2.3 and R2.8 billion in 1995. PART I CHAPTER 1 49 Extensive problems were experienced in obtaining fuel for this plant because of the numerous international requirements, embargoes, political decisions and policies, some being of South African origin. The AEC developed its own fuel enrichment plant called the Z-plant, which started operating in 1986 using a novel local technology. This was followed by the construction of a fuel fabrication plant, the BEVA-plant, which was commissioned in 1988. Limited information is available on the cost of these activities as they were classified as top-secret. The cost of the locally produced fuel assemblies was also much higher than purchasing on global markets and, in March 1995, the uneconomic Z-plant was closed down, followed by the closure of the BEVA-facility in 1997. Eskom has supported the development of an experimental pebble-bed modular reactor (PBMR) from about 1995. The technology of the PBMR is reported to be inherently safe and environmentally friendly. The PBMR would be constructed in approximately 150 MW modules which could also be suitable for export. However, opposition from specific organisations in regard to the high cost of the technology, nuclear safety and proliferation and the handling of waste products, has delayed its development. Renewable Energy Although the use of firewood and crop residues is extensive in specific rural areas, other more modern forms of renewable energy form a very small part of the energy sector, and many of the projects are still at the experimental stage. In addition, the cost efficiency of electricity produced by renewable technologies in relation to the low price of coal-generated electricity presents a challenge for the growth of this sub-sector. The main components are: • Household and institutional solar water heaters • Photovoltaic systems in remote telecommunications facilities • Large wind generators in areas with high wind speeds • Sugar mills utilising bagasse in co-generation plants • Mini-hydro plants and pumped storage installed in isolated parts of the country • A rural household solar photovoltaic system pilot project, and • Refuse in landfill sites converted to biogas and methane (refer case study on New England Road landfill) (end Chapter 1). The DME released a White Paper on Renewable Energy in 2003 (DME, 2002b). Among others, this sets a target for renewable energy-based electricity of 10 000 GWh by 2013. In January 2004, the government created the Energy Development Corporation (EDC) within the CEF group of companies (www.cef.org.za). The EDC supports the development of modern renewable energy and energy efficiency projects, especially in markets where there is insufficient private sector activity. A number of projects and initiatives are underway, including a low-smoke fuel project, solar water heating, hydropower and biodiesel. The government is looking into supporting and subsidising renewable energy investments. Water and Sanitation Background This section provides an overview of major developments since the beginning of the 20th Century, with in-depth examples of certain features such as the evolution of water services in the Witwatersrand, predominantly the southern portion of Gauteng, and the more recent emphasis on rural areas. Further detail on current policies, institutional and financial arrangements, and coverage are contained in subsequent chapters. For the purposes of this report, “water sector infrastructure” is defined as follows (Eberhard, 2004): • Water resources infrastructure includes dams, inter-basin transfer schemes and related infrastructure. Water may be used for domestic, industrial, power or irrigation use • Water services infrastructure includes the infrastructure necessary for the conveyance, treatment, storage and distribution of water to end-users; and sanitation infrastructure for the conveyance, treatment and disposal of waste water, and on-site treatment of domestic human waste • Irrigation infrastructure is the infrastructure necessary to undertake irrigation but excludes multi-purpose water resources infrastructure as defined above. 50 THE DBSA INFRASTRUCTURE BAROMETER South Africa is a semi-arid country with unevenly distributed rainfall (43 percent of the rain falls on 13 percent of the land) and with high annual variability and unpredictability. Until the 20th Century, most farming was rain-fed with only isolated pockets of irrigation, but from the early 1900s, successive governments concentrated on the provision of water for irrigation to increase agricultural productivity and to absorb surplus (usually white) labour (Wall, 1983). By the mid-1900s, the demand for water was beginning to shift towards the needs of a growing industrial economy, but the growth areas did not coincide with the availability of water. The industrial heartland of the country, the area surrounding Johannesburg, is situated in an arid zone and straddles a continental divide. As a consequence, inter-basin transfer schemes have been developed which are amongst the largest in the world (Abrams, 1996). Historically, government ideology and its manifestation in policy have had a profound influence on the development of water infrastructure in South Africa. Subsequent to the foundation of the Union of South Africa, the strong centralised government set up a sizeable and technically proficient Department of Water Affairs (initially known as the Department of Irrigation), and directed explicitly social irrigation schemes such as the Vaal-Harts Scheme. The Orange River Development Project and the development of water infrastructure to support strong state enterprises, such as Eskom, followed in later years. The uneconomic homelands system and the associated regional and geographically-dispersed spending on irrigation and rural water schemes were pursued for several decades. After 1994, the focus on the part of the Department of Water Affairs and Forestry (DWAF) was radically shifted to one of meeting basic needs. Water Resources The number of dams commissioned in South Africa is shown in Figure 10 by decade (World Commission on Dams, 2000). It illustrates the political imperative to support commercial farming through irrigation which was accelerated following the accession in 1948 of the National Party with a large and vocal rural constituency. Figure 11 provides fiscal capital expenditure on water resource development from 1960 onwards. While most dam construction up to that time had been primarily to serve agricultural needs, attention in the decades after World War II turned increasingly to the water needs to support mining, industry, power production and the burgeoning urban populations, especially in the metropolitan areas. The current serious water shortages in Cape Town provide a vivid example of the pressures of urbanisation. The projected water shortages on the Witwatersrand were a major factor in stimulating the Lesotho Highlands Water Project (LHWP). In addition, because of the generally low flows and major seasonal variations in base river flows, DWAF promulgated stringent discharge regulations to protect streams from pollution, especially during the dry months. Figure 10: Number of dams commissioned in South Africa (by decade) UP /PQFSEFDBEF %FDBEF PART I CHAPTER 1 51 Figure 11: DWAF capital expenditure on water resources in real terms (2000 prices) 3NJMMJPOQFS': 'JOBODJBM:FBS Note: Excludes approx R16 billion spent on LHWP in Lesotho and in South Africa between 1990 and 2004. The signing of the LHWP Treaty by the Governments of Lesotho and the Republic of South Africa on 24 October 1986 established the Joint Permanent Technical Commission (JPTC) to represent the two countries in the implementation and operation of the LHWP. The first Phase (1A) of the proposed four-phased scheme comprises a large dam at Katse in the central Maluti Mountains, an 82 km transfer and delivery tunnel system reaching to the Ash River across the border in South Africa, and a hydropower station. This phase was commissioned in 1998 and an average of 1 470 Megalitres of water per day is now being delivered to South Africa. Phase 1B, comprising Mohale dam and a 32 km long transfer tunnel between Mohale and Katse reservoirs, was completed in 2004 and will add 1 000 Megalitres per day to the yield of Katse. The LHWP was a very significant infrastructure development which sought to secure adequate quality supplies for the industrial heartland of South Africa. It has been argued that the demand projections for the Vaal River system were overly ambitious and that the development of the infrastructure comprising the LHWP could have been delayed through better raw water pricing and more efficient use, with substantial savings to consumers. Energy experts indicate that South Africa has moderate hydroelectric potential, and that the establishment of small hydroelectric projects around the country could provide a sustainable future energy supply. The US Department of Energy estimates that 6 000 to 8 000 potential sites in South Africa are suitable for small hydroutilisation below 100 megawatts, with the provinces of KwaZulu-Natal and the Eastern Cape offering the best prospects (Southafrica.Info Reporter, 2004). The largest hydroelectric power plant in South Africa is the 1 000 megawatt Drakensberg Pumped-Storage Facility, part of a larger scheme of water management that brings water from the Tugela River into the Vaal watershed. The country’s second-largest plant, also a pumped-storage scheme, is situated on the Palmiet River outside Cape Town. Water transfer between Lesotho and South Africa also generates electricity at the Muela Hydropower Plant, making Lesotho self-sufficient in electricity generation. The electricity generation industry is a large consumer of water and the choice of cooling technology has a highly significant impact on water demand. Water-cooled coal-fired power stations typically consume some 2 litres/kWh (efficient ones slightly lower, at about 1.7 litres/kWh), whereas dry-cooled power stations consume only about 0.1 litres/kWh. There is also a relationship between specific water consumption and plant age, as the newer water-cooled plants show an improvement in water use efficiency. The most recent plants are drycooled and offer a very significant reduction in specific water consumption. The recent proposal to re-commission several of the older mothballed plants to increase generation capacity could have a marked impact on water requirements from the systems that supply them. Water resource management also includes controlling effluent discharges, since these are an integral part of South Africa’s limited water resources. Because of the seasonal flow of most streams, all municipal sewage discharges to surface water streams are required to be treated to specified standards. Most have the requisite facilities installed but poor operations and maintenance sometimes result in poor quality discharges (refer Chapter 3 for more detail). 52 THE DBSA INFRASTRUCTURE BAROMETER Water Services Urban water services Municipalities Almost all early human settlement was dictated by the availability of fresh water. An important exception to this was the gold mines of the Witwatersrand where settlement was situated on a watershed with very limited local sources of water. In the early years, the provision of water to cities and towns was largely the responsibility of the towns themselves. In well-watered areas, early urban water supplies began as river flow diverted into open canals through the settlement (e.g. Cape Town, Stellenbosch, Grahamstown). Over time, these were superseded by combinations of weirs, pipes and reservoirs, and increasingly larger and more distant storage dams. In semi-arid areas, initial supplies depended largely on groundwater but increased demand has, in many cases, required extensive investment in more distant sources. During the second half of the 20th Century, the National Department of Water Affairs assumed greater responsibility for the planning of water resources and the development of water resources infrastructure for cities and towns, especially where this infrastructure was significant and where water schemes were constructed for multiple uses. Most towns and cities have been challenged for decades to keep apace with population growth due to urbanisation. Most recently, the newly demarcated municipalities are even more challenged to provide services in those rural areas that have been incorporated into municipal areas. Since 1994, two sets of demarcation of service areas, successive reorganisations and a re-allocation of powers and functions have all impacted on the ability of local government to render water services efficiently. A small number of attempts have been made to involve the private sector as operators of urban water services (two 30-year concessions and several management contracts, including Johannesburg Water). While these can be described as qualified successes, there is much unease about public-private partnerships and the political and regulatory environments are not currently conducive to this form of restructuring (Jackson, 2002). The provision of sanitation services and treatment of waste water has always been a local authority function (except where homeland governments managed certain urban areas within their jurisdiction). One regional waste water utility, ERWAT (East Rand Watercare Company), was set up 1992 and is owned by several municipalities in the East Rand. Anecdotal history records that, within five years of Johannesburg’s foundation, a bucket removal system was set up (circa 1890), and Cape Town began installing a “modest” sewerage system in 1895 and Johannesburg in 1904. Recent policies that have greatly influenced the sector include: • The 1994 White Paper on Community Water Supply and Sanitation, which introduced an “RDP Standard” for basic water services • The Free Basic Services Policy of 2001 • The National Water Services Strategy of 2003 (refer Chapter 2), and • The transfer of rural schemes from DWAF to municipalities (refer Chapter 2). Apart from two sets of legislation aimed at local government, Municipal Structures Act (1998) and Municipal Systems Act (2000), the most significant and comprehensive legislation has been the Water Services Act of 1997. This declared the right of citizens to basic water supply and sanitation; it laid down the basis for regulations on standards and tariffs; it drew a distinction between water services authorities (local government) and water service providers; and spelled out their responsibilities. It also gathered a uniform set of requirements for all Water Boards. Water Boards From the time of the discovery of gold on the Witwatersrand in 1886, the supply of water to the area was entirely in the hands of private companies. The price was high and the supply erratic. After various governmental commissions, it was decided that the Rand Water Supply Board (RWB) should be constituted by legislation. The Board, established in 1903, was given certain powers for the exploitation of water, could raise loans and arrange for their repayment, and could lay down tariffs for the sale of water. The RWB was initially constituted under a Transvaal Provincial Ordinance. In 1950, a Private Act was created, being the Rand Water PART I CHAPTER 1 53 Board Statutes (Private) Act 17 of 1950. A number of amendments and consolidations followed. This Act coexisted with the Water Act of 1956 but was replaced by the Water Services Act (Act No. 108) in 1997. Rand Water was the forerunner of a family of public utilities or Water Boards which emulated, in many respects, the purpose, mandate and modus operandi of the pioneering water utility in South Africa. Before 1997, the activities of these Water Boards were governed by the Water Act of 1956. The enactment of the Water Services Act of 1997 brought all Water Boards under its ambit. The Water Services Act allows the Minister of Water Affairs and Forestry to establish and dis-establish Water Boards. A total of 15 Water Boards have been created to date (refer Chapter 2 for more detail). Water Boards are public entities in terms of the newly enacted Public Finance Management Act, with shareholding and control held by national government. After 1994, DWAF encouraged Water Boards to play a more proactive role in the delivery of retail services, especially to poor consumers. Several became actively involved in the retail water distribution business. This was undertaken in an ad hoc manner until the Water Services Act 1997 effectively authorised Water Boards to undertake retail services. Another form of bulk and retail water services provider has been created in KwaZulu-Natal. uThukela Water is a multi-jurisdictional Box 6: Rand Water service district set up in 2004 in terms of the Municipal Systems Act. It Rand Water was the first professionally-run and managed water utility to be established in South is owned and controlled by three district municipalities and one local Africa. It was established as a self-funding bulk water municipality. utility to provide water to mines and urban areas in the Witwatersrand area. The initial guarantors for the RWB were, interestingly, the local authorities and not the mining houses. Together with the major mining houses, the local authorities formed the so-called foundation members and each had a representative on the management board of the utility. In 1915, the dolomitic waters were fully exploited and it was decided to turn to the Vaal River for further water supplies. The Vaal Barrage was built in 1921 (built and financed jointly by Rand Water and the National Government) and water pumped to the Witwatersrand from 1923. This development secured a reliable and expandable supply and enabled the RWB to extend its area of supply. RWB supply was extended to Pretoria in the 1940s, the far West Rand in the 1950s, the Eastern Goldfields in the 1960s and Rustenburg for the platinum mines in 1966. Further expansion of the supply area has continued to the present day. Rural Water Services Until the creation of the homelands in the 1970s, little or no government attention was given to the provision of water services in rural areas. Water supplies were typically community activities supported by missions. These areas were largely populated by dispersed traditional settlements, or artificial resettlement villages made up of people displaced from so-called “white areas”, plus some formal urban settlements. Later, the newly-established homeland governments sought to provide water supplies to rural areas but they had insufficient resources and paid scant attention to operations and maintenance and securing the funds needed for operations and maintenance. Many formal homeland towns received full services, including sewerage, funded directly by the South African government, but struggled to maintain them. Soon after the new government was formed in 1994, DWAF established a Community Water Supply and Sanitation Programme (CWSSP) which was strongly aligned with RDP objectives. This Source: Eberhard, 2004 programme focused primarily on water supply in rural areas, but probably less than 10 percent of the funds were allocated to sanitation. A total of R7.1 billion has been spent by DWAF on water supplies between 1994 and March 2005, and an estimated 10.2 million people have been provided with access to a piped clean water supply (DWAF, 2005a). This is one of the largest and most rapid programmes of service provision in Africa (WSP, 2002). In the absence of a formal and stable local government framework and prevailing weak capacity, a flexible approach to delivery was adopted at the time. As partners in delivery, the programme made use of Water Boards, NGOs (notably the Mvula Trust), some transitional local government bodies and private sector companies. In 1996, the programme was accelerated in four provinces through the use of four private-sector partnerships contracted to build, operate, and transfer (BOT). These partnerships had mixed results. Although speed of delivery was increased, capacity was not optimally used and high unit costs resulted. The approach emphasised construction and thus, as a result, issues of cost recovery and sustainability suffered (Jackson, 1999). Until recently, little attention had been given to sanitation facilities, but this is now a major DWAF thrust, with targets of more than 300 000 improved latrines per annum in order to address the backlog by 2010. A white paper and a strategy for sanitation were approved in 2001 and momentum has been building steadily 54 THE DBSA INFRASTRUCTURE BAROMETER since then. In particular, sanitation programmes are not just exercises in building facilities but emphasise the need for user education. R1.2 billion has now been allocated to this programme and a priority target is to phase out the 460 000 bucket latrines by the end of 2006. The CWSSP has been a major achievement in terms of infrastructure delivery. New means of involving communities in the planning of projects have been implemented and new implementing agent arrangements tested. Problems are evident with the operation of many (but not all) of the water supply systems constructed under the programme. The CWSSP programme is in the process of being wound down. Capital subsidies are now being channelled through the consolidated Municipal Infrastructure Grant (MIG), so consequently the direct role of DWAF in water services infrastructure delivery will diminish and the role of local government will increase. Irrigation Box 7: Reflections on the Rural Water Supply Programme Some lessons arising from this large and significant programme in providing basic water services infrastructure include the following: 1) Capacity. DWAF was able to harness its relatively strong institutional (technical and operational) capacity (developed in earlier years and focussed on resources) in a new direction and endeavour. However, local government has very weak capacity in many areas of South Africa and this poses a risk to the sustainability of water services infrastructure now that responsibility for this has been transferred to local government. 2) The operational sustainability of the schemes developed poses a significant challenge to the sector as a whole. Standards were engineer-driven and may prove to be unsustainable in certain circumstances. 3) Multiple roles. DWAF was the financier, policymaker and regulator (as well as provider). The role of DWAF will change in future. 4) Private participation was important for the delivery of the infrastructure (design and construction) but has not been a major force in the operation of infrastructure. The political context indicates that future take-up of the private sector in service provision will be slow. The Roman-Dutch water law in the early colonies and Boer Republics empowered the state to divide water as it thought fit in the interests of the people. The common law of England was later introduced, a law evolved to deal with problems of, for example, driving water wheels, but not conducive to the use of water for growing crops under irrigation. In particular, the owners of riparian land (adjoining or containing a river) were the sole owners of all the water in the stream (Wall, 1983). Source: Eberhard, 2004, based on WSP, 2002 The Irrigation and Conservation of Waters Act of 1912 created the means to set up irrigation boards for the purposes of controlling cooperative irrigation schemes. This effectively enabled farmers to organise and lobby for the construction of storage schemes for a number of beneficiaries who had riparian rights to the stored water. Almost all such dams were constructed with public funds. There were notable exceptions to the riparian principle, the main one being the government-sponsored Vaal-Harts Irrigation Scheme in the 1930s. The 1956 Water Act allowed for government control of water rights for the most beneficial use, but such control was required to respect pre-existing rights of individuals, provided that they were exercised beneficially and with due regard to the rights of other consumers. The National Water Act of 1998 marked a significant departure in the treatment of water rights, moving from a (largely) riparian system to one of administratively authorised and time-limited water use, effectively separating water rights from land ownership (more detail in Chapter 2) (Eberhard, 2003). Further, South African agricultural policy has aimed since 1998 to increase the income of the poorest groups in society. The National Agricultural Policy prepared by the Department of Agriculture (DOA, 1998) gives particular attention to small-scale agriculture, including supporting production and stimulating an increase in the number of new small-scale and medium-scale farmers. DWAF reports that it has developed a common approach with the Department of Agriculture in order to assist small farmers to access the water reserved for them (Sonjica, 2005). Information and Communications Technology (ICT) Background This section captures the historical context in which information and communications technology (ICT) has evolved in South Africa over the past 50 years, and gained momentum during the last two decades. The context of infrastructure in the ICT sector should be seen in the widest possible sense. In a globalised world, information infrastructure has no boundaries, however policy and physical infrastructure remain local issues. PART I CHAPTER 1 55 While facing the challenge of providing basic infrastructure, South Africa has the advantage of being able to leapfrog technologies and to develop modern infrastructure, applications and content of a knowledge-based economy based on ICT. The sector, commonly known as ICT, includes information technology (IT), radio, TV, broadcasting, cellular and fixed-line, mail services and networks. As experienced worldwide, this sector has developed enormously in South Africa over the last 20 to 30 years. Historical Context From the 1950s to the 1990s, South African telephone services were provided by the Department of Posts, Telecommunications and Broadcasting. During this time, the Post Office was responsible for running both telecommunications (fixed telephone and telegraph lines) and postal services. Documents were sent by paperbased mail, either by rail, road, air or sea. The fastest way to get a formal document to another country, or to remote areas within the country, was by airmail. The cost of the mail service was recovered by means of postage and the postage stamp, which is still the payment medium today (and which makes an interesting collector’s item). Phased liberalisation of telecommunications was implemented shortly after 1990 with the creation of Telkom as a distinct public corporation in 1991. Authority for telecommunications services was transferred from the Post Office to Telkom, and hence, Telkom SA received the responsibility to license other operators in telecommunications. The policy flux within the telecommunications sector is indicative of enormous political and social transformation at the national level and reflects the rapid changes in the global telecommunications market. Regulations The Department of Posts, Telecommunications and Broadcasting regulated all nationwide communications networks until 1990. In anticipation of possible privatisation, the government formed two state-owned companies in 1991, the telecommunications corporation, Telkom, and the South African Post Office (SAPO) to deliver the mail. However, institutional arrangements resulting from the policy reform soon required a more complete break from the past and an end to regulation of the sector by Telkom and the Department of Posts and Telecommunications. An independent regulator, the South African Telecommunications Regulatory Authority (SATRA) was established to oversee the liberalisation of various telecommunications market segments in a phased process and to regulate them in the public interest. In 1999, the Minister changed the name to the Department of Communications, and it assumed responsibility for setting policy on telecommunications and the radio frequency spectrum, while the Regulator became responsible for impartial implementation of that policy. Apart from its post and telecommunications policies, the South African Government had no policies relating to ICT before 1994. Some of the important Acts and policies that have governed ICT in South Africa since 1994 are listed (Botha, 2004): • Green Paper on Telecommunications (1995) • White Paper on Telecommunications (1996) • Telecommunications Act (1996) • Independent Communications Authority of South Africa Act (2000) • Telecommunications Amendment Act (2001) • Regulation of Interception of Communications and Provision of Communication-related Information Act (2002) • Electronic Communication and Transactions Act (2002) • Promotion of Access to Information Act (2003). The Convergence Bill that will assemble all current legislation is being debated in Parliament. The Independent Communications Authority of South Africa (ICASA) is the regulator of the telecommunications and broadcasting sectors. ICASA was created in 2000 in terms of the Telecommunications Act, following the merger of the South African Telecommunications Regulatory Authority (SATRA) and the Independent Broadcasting Authority (IBA). 56 THE DBSA INFRASTRUCTURE BAROMETER Access to Broadcasting, Post and Telecommunications Telecommunications The telephone service became a symbol of racial disparity under Apartheid, especially during the 1980s when per capita access to a telephone service in black communities was less than one-tenth of that in white areas. For this reason, early-1990s plans for a cellular telephone network in rural and township areas, as well as the creation of Telkom in 1991, assumed symbolic as well as economic importance as a means of black economic empowerment. The two cellular operators, MTN and Vodacom, started operations in April 1994. Their licences required them to deploy a community telephone service in areas under-provided with telephone services and at a tariff less than the normal cellular tariff. In this way, they provided the first telephone service to many rural areas, assisting local entrepreneurs for whom communication had often been a major obstacle in the past. Within five years, the cellular phone industry has created at least 4 500 jobs directly, and it has also contributed to the creation of some 40 000 or more jobs in related industries. The continued phased liberalisation policy of Government culminated in the privatisation of Telkom in 1997. From the perspective of promoting universality, the strategy to boost telephone penetration through the granting of five-year exclusivity to Telkom in exchange for doubling the network, has not produced the desired outcome. According to the Census Report (2001), 23.8 percent of households have fixed line telephones in their dwellings. At the time of its privatisation and granting of exclusivity in 1997, Telkom was given mandatory service obligations to install 3 million new lines. During the next five years, Telkom installed 2.8 million new lines but only about 670 000 of these lines remain connected to end users. This situation has resulted in a drop in the overall fixed line network penetration during the three years of the exclusivity period up to 2002. To meet its licence targets, Telkom installed a significant number of access lines that proved to be uneconomic and have since been disconnected. Price increases way beyond those anticipated by the rate rebalancing price control model regulated by ICASA, contributed to this dire situation. Charges have increased by an average of more than 27 percent each year (Gillwald and Kane, 2003). The government began allowing the private sector to provide data transmission services in 1994. The plan was to allow companies to use Telkom facilities to provide customers with value-added services, such as the electronic transfer of funds and messages, management of corporate data networks, and the remote processing of corporate information. Telkom retained control over the independent telecommunications services to continue the company’s statutory monopoly overall and to regulate competition in the field. Private companies were able to lease facilities, such as data lines, from Telkom and charge customers only for value added to these services. The Value-Added Network Services (VANS) market, which includes Internet Service Providers in South Africa, is liberalised but its activities have been stunted by restrictions which stipulate that it acquires facilities from Telkom SA (Gillwald and Kane, 2003). Broadcasting The South African Broadcasting Corporation (SABC) initiated a national television service in 1976, and enjoyed a near-monopoly until the independent television company, M-Net, inaugurated its services in January 1991. In 1993, the government placed SABC broadcasts under the supervision of the Independent Broadcasting Authority (IBA), as a step toward greater media independence from political control. The television service in the 1990s consisted of four channels broadcasting in English, Afrikaans and five African languages. Residents of some of the former black homelands, and those near the border with Swaziland, received separate broadcasts from other areas until 1994. After that, the television service in the former homelands was incorporated into the nationwide system. A reorganisation of SABC was implemented in the mid-1990s to cater for greater diversity in its broadcasting. The SABC operates 300 frequency modulation (FM) and 14 amplitude modulation (AM) radio stations. Before the early 1990s, programmes were primarily in English and Afrikaans, but several low-power FM stations broadcast in at least a dozen African languages and the use of African languages was increasing. One short-wave external service, Radio RSA, broadcasts worldwide, while several of the stations stream on the Internet. South Africa installed its first satellite earth station in 1975 to supplement existing undersea telecommunication cables. PART I CHAPTER 1 57 Postal services The South African Post Office (SAPO) provides postal and money-transfer services, as well as operating postal savings accounts, and has one of the most diffused network of post offices and presence in remote areas. South Africa was readmitted to the Universal Postal Union in 1994, enabling it to participate in international technical assistance programmes and accounting facilities within the Union. Technology The country had no infrastructure to broadcast, receive and distribute television signals until the late 1970s. Private, emergency and security communication used radio bands. All other communication lines were copper-based, with limited microwave links that required expensive infrastructure over long distances. These microwave links are still operational today, but serve mainly as backup communication lines should the main links, which are now optical fibre, be temporarily unavailable. The era of the mainframe came to an abrupt downturn with the advent of the personal computer (PC), which was introduced into the workplace towards the latter half of the 1980s. The advent of the facsimile machine in the same period eroded the need for telex. PCs were not initially connected, but the first Local Area Networking (LAN) infrastructure started to appear at the end of the 1980s (Botha, 2004). The World Wide Web was introduced in 1989 by Tim Banners-Lee at CERN (European Centre for Nuclear Research) as a way to connect information on computers at the global level. As a result of browser development, the Web became available to the world in 1993. South Africa was not left behind and gained access to the Internet and Web in 1994, first through the academic world (Rhodes University), and later in the corporate business and government arenas. About 3.3 million South Africans had access to the Internet by the end of 2003. Post-2000 Today, the telephone system includes a network of coaxial and fibre optic cable and radio-relay, three ground stations that communicate with satellites over the Atlantic and Indian Oceans, and an undersea coaxial cable between South Africa and the Canary Islands that joins other cables linking Europe with South America. Mobile telephony - cellular networks (Global System for Mobile Communications, GSM) - is dominating market penetration, whilst fixed networks lag behind. This is driven by the need to extend access to remote areas, cheaper infrastructure in the home and office and the new mobile commerce services being developed. WiFi (Wireless Fidelity) may be the preferred networking trend for the decade, but remains restricted for use in company premises only and may not cross Telkom boundaries. Satellites for communications, broadcasting, navigation and surveillance technologies will be used more extensively for Internet linkages with the rest of the world, and eventually for downlinks to the subscriber. Having decided not to go the analogue cable pay-TV route in the 1990s, South Africa now has a very successful digital satellite TV (DStv) service, a decision that is paying off. MTN and Vodacom have established independent agreements with satellite phone companies, allowing for the provision of satellite phone services to the subscriber. South Africa has a small but successful mini-satellite building capability (SunSpace) and exports this technology embedded in complete systems (Botha, 2004). The licence for the Second National Operator (SNO) was approved in December 2005, and will bring the long-awaited competition to the fixed-line market. This will remove Telkom’s monopoly and could lead to more affordable telecommunications services. South Africa currently has some 22 million mobile subscribers (BMI-TechKnowledge, 2005), which means that one in every two South Africans has connectivity. Of the new connections currently being made, 88 percent are prepaid packages. The steep growth in mobile phones as compared with fixed lines, is illustrated in Figure 12. 58 THE DBSA INFRASTRUCTURE BAROMETER Figure 12: Comparison between fixed line and mobile telephones /VNCFS 'JYFE-JOF .PCJMF :FBS Source: Botha, 2004 Vodacom and MTN, the two leaders in the cellular market, indicate that the market is worth about R47.4 billion per annum. This was calculated by adding the revenues reported by Vodacom (R23.5 billion) and MTN (R23.9 billion) for the financial year ending 31 March 2004. The major data traffic is in SMS (Short Messaging Service). Third Generation (3G) technology is being tested at present and may be the carrier of the future, providing larger bandwidth and mobile interconnectivity. This decade may see a very small portable PC-cellular phone-multimedia recording, storage and transmission device that works on the principle of the current generation cellular phones, but with much more processing power. With peer-to-peer architecture and communications (e.g. Bluetooth), networking will be enabled that will allow effective communication with other computers while mobile. Such a development may mean the end of the PC as we know it (Botha, 2004). Much of the rapid change in the ICT environment is due to the fact that numerous different technologies converge to the same user platform. This has an impact on infrastructure in the sense that it requires continuous improvement in performance, hardware and software upgrades and capacity expansion. PART I CHAPTER 1 59 Spotlight on the New England Road Landfill, Msunduzi Municipality: Landfill Gas Use Study Landfill gas pumping trial underway at the Luuipaardsvlei Landfill in Mogale City to determine the sustainable yield of landfill gas. Methane gas is generated by the decomposition of bio-degradable material deposited in municipal waste landfill sites. South Africa generates more than 42 million cubic metres of solid waste every year (Department of Environmental Affairs and Tourism, 1999). This is equivalent to approximately 0.7 kg per person per day. About 40 percent of the waste is organic. Depending on climatic conditions, this organic material is converted into landfill gas, which consists of about 55 percent methane. As a “greenhouse gas”, methane has severe detrimental effects on the earth’s climate. It is 21 times more damaging to the ozone layer than carbon dioxide. In Msunduzi (Pietermaritzburg), the New England landfill site has been used for the disposal of various forms of waste since the 1930s. As part of its commitment to the environment, the municipality installed monitoring points for landfill gas in 1995. These indicated that a significant quantity of gas was being generated and that the gas had been migrating within the waste body from the north to the west of the site. A number of curtain wells were installed in 2000 to extract the gas, preventing it from escaping into the atmosphere and eliminating the harmful effects on the health of the nearby community. The average volume of gas yielded by these wells, which were flared to avoid environmental damage, has been measured at 260 m3 per hour. Pumping trials on other wells indicated a potential sustainable yield of about 2 400 m3 per hour which would have a potential energy value of 3 MW. This is sufficient energy to supply more than 1 500 low-income houses with all their energy needs. In order to gain a better understanding of the situation at the New England Road landfill site, the DBSA’s Development Fund provided a grant for a study to be carried out. The objective of the study was to identify 60 THE DBSA INFRASTRUCTURE BAROMETER and assess the options for the use of the gas generated at the landfill site while achieving sustainable development objectives. The study has considered various options for the utilisation of the gas and has quantified its value both as a financial resource as well as its potential to generate carbon credits (Carbon Emission Reductions, CER). Carbon credits are generated through the Clean Development Mechanism established in terms of the Kyoto Protocol which set carbon dioxide emission reduction targets for industrialised nations. For developing countries such as South Africa, the benefit of reducing greenhouse gas emissions is that carbon credits can be sold to industrialised nations to achieve their own quotas of emission reduction. Landfill gas is particularly attractive because, for every tonne of methane reduced, 21 CERs are generated. One CER is currently (2005) worth about $3.50. Technically, the main options for managing the landfill gas are flaring, electricity generation and direct industrial gas utilisation. Meetings have been held with a number of stakeholders who could be potential users of the gas, and financial analyses have been carried out on each of the options. Council still needs to decide which option will be the most appropriate. SPOTLIGHT ON NEW ENGLAND ROAD LANDFILL, MSUNDUZI MUNICIPALITY: LANDFILL GAS USE STUDY 61 CHAPTER 2 The Operating Environment Chapter 2 describes the current reality within which transport, energy, water and sanitation, and ICT operate in South Africa. What are the policies, the institutions, the regulations and, last but not least, the financial systems governing the operations of these four economic infrastructure sectors? Introduction The four infrastructure sectors introduced in Chapter 1 operate within a dynamic institutional and financial support system. Each sector is regulated and strategically guided differently. This chapter provides an overview of this operating environment for transport, energy, water and sanitation, and ICT, and guides the reader through the sometimes complex institutional and financial systems governing the sector. Where possible, the chapter also highlights opportunities and weaknesses in the system and the roles of the public and private sectors. Transport Introduction The transport sector has been the focus of various reforms since 1994. This has involved the creation of agencies at national government level, private sector involvement in national roads development and airports, and re-orientation in the role of provinces. At local government level, the National Land Transport Transition Act (NLTTA) provides scope for a change in functional responsibility which has the propensity to benefit transport users considerably. In certain areas, such as regulation of the minibus “taxi” industry, restructuring of urban bus routes and improvements in the functioning of commuter rail, there have been some changes but, for the average commuter, very little has changed for the better. In the case of freight transport, the quality of primary roads has certainly improved, the condition of provincial roads has slowly worsened, and railways have lost considerable market share to the roads sector. From an air transport perspective, the quality of airports has improved and the market has become more competitive. The challenge for this sector remains the gap between policy and implementation, with regulatory and institutional reform necessary in a range of areas, including the functioning of metropolitan transport, the quality of road infrastructure and reform of the freight logistics industry. Policy Realising that it was necessary to become outward-looking and to focus on transport infrastructure that would increase South Africa’s competitiveness in the world market, moves were put in place in the 1990s that markedly changed the method of providing transport infrastructure. The 1996 Transport White Paper aligned Government involvement in transport more closely with GEAR (growth, employment and redistribution). The role of transport was seen as a potential catalyst for development, the correction of spatial distortions and, through integration and operational improvements, as a system-wide response to the needs of passenger and freight customers. The White Paper (Department of Transport, 1996) provides the following policy objectives: • Support by transport for basic needs development and growth of, and competition within, the economy • The development of a customer-aligned transport system for passenger and freight users • Enhanced quality of transport services, including safety, security, reliability, speed and cost of service provision, and • Investment in infrastructure/transport systems so as to satisfy social, economic and strategic investment criteria. The mission for transport infrastructure is (Department of Transport, 1996): “… to provide integrated, well-managed, viable and sustainable transport infrastructure meeting national and regional goals into the 21st Century in order to establish a coherent base to promote accessibility and the safe, affordable, reliable movement of people, goods and services.” In the post-1994 era, “social” infrastructure received much attention, particularly the provision of local streets and improvements in accessibility through road infrastructure development in and around townships. More recently emphasis has been placed on investment planning for “commercial” infrastructure to sustain and support economic growth, although little investment to this end has yet taken place. PART I CHAPTER 2 63 Box 8: Moving South Africa Moving South Africa (MSA) stressed the need for enhancing levels of sustainability in the transport system. Four causes of poor sustainability were identified: • Insufficient financing • Escalating externality costs • Low levels of skill and capacity, and • Poor drivers of operational efficiency. The strategic framework developed by MSA focused on three levels of action (National Department of Transport, 1999): 1) Consolidate the scope of different parts of the network: In both urban areas and along the key freight routes, actions should be taken which consolidate demand into key corridors. The objective of this consolidation is to reduce the costs of transport through increasing economies of scale and the frequency with which services are provided. A support network of services should supplement this core corridor network and feed into the core corridors at strategic nodes. 2) Role of modes: Actions to apply the appropriate mix of modal technology to optimise the role of modes on the network to achieve economies of scale whilst sustaining high quality of services at optimal cost, and 3) Firm-level competitiveness: Actions to enhance the productivity and efficiency of transport providers. Such actions would encourage competition based on value to the customer and would encourage innovation and increases in productivity. These actions are consistent with best practice elsewhere in the world, but require a complex array of interventions at all levels of Government to make the strategy a reality. Shortly after the 1996 White Paper, a high-level implementation framework was set out in the form of the Moving South Africa (MSA) project (Box 8). This National Department of Transport strategy was issued in 1998 and 1999. Progress towards achieving the MSA vision, such that a discernable impact is noticed by users, has been slow and, in some cases, interventions in the sector have not supported the strategy. It could be that this was because of the lack of a clear implementation agenda, a lack of capacity in the Department of Transport, conflicting approaches within different sub-sectors of transport, a lack of a clear institutional structure, entrenched interests by a number of both public and private sector players, or a combination of these factors. The National Land Transport Transition (NLTTA) Act of 2000 provides supporting legislation for provincial and local government in the promotion of public over private transport. The Act takes a regulatory approach to the planning and provision of public transport. All public transport services, including rail, bus and the routing of minibus “taxis”, would be specified by government. Subsidy would be allocated where necessary to sustain the network and to provide for the needs of the poor. However, the Act provides little in the way of a clear funding mechanism or an enforcement regime, and is focused on operational specification rather than infrastructure development. Some scope for the involvement of the private sector in the provision of transport-related infrastructure has been created. This is particularly true in the financing of primary roads under the responsibility of the South African National Roads Agency (SANRAL). Mechanisms for applying a user-pay principle for the use and provision of transport infrastructure at provincial and metropolitan levels have yet to be clarified by Treasury. Transport infrastructure under the control of Transnet is particularly well-suited to greater levels of private sector participation. Enhancing the role of the private sector in both operational and infrastructure responsibility in the rail and ports sector is currently under consideration by Government policy makers. The recently released National Freight Logistics Strategy (September 2005) provides a platform for restructuring the freight logistics sector. It articulates a policy shift away from the current arrangements which are regarded as a mix of intense competition such as found in the road freight sector, and monopoly control such as found in rail and ports. The document describes a situation of poor overall government policy and direction, ineffective regulation of the sector, poor operational performance and mediocre delivery to customer requirements. The objective of the strategy is to reduce the overall cost of logistics in South Africa and to enhance the logistical interface between the 1st and 2nd economy. The mechanism for achieving this would be through a process of re-alignment in the case of Transnet, the implementation of more effective and sector-wide regulation, a clearer incentive – based approach to enhancing efficiency, and improvements in the asset base of the freight logistics sector. Government will retain majority ownership of critical infrastructure and remain responsible for network management and development. Infrastructure and operations will be vertically separated where feasible. Scope will be created for the private sector to compete on a level playing field and have equitable access to infrastructure. A user pays principle will be adhered to. Explicit allowance is however made for cross-subsidisation through higher tariffs on the high-volume freight network. This will be used to provide infrastructure outside of this 64 THE DBSA INFRASTRUCTURE BAROMETER core network and to sustain access by BEE and smaller operators. The structure of the regulation of the sector will shift from a modal orientation to functional responsibility. Three functional regulatory areas have been identified; safety and environment, economic and security. Regulatory Environment National (Primary) Roads SANRAL is a wholly-owned state company registered in terms of the Companies Act. The South African Government, represented by the Minister of Transport, is the sole shareholder and owner of the Agency. Its mandate is to develop, maintain and manage South Africa’s 6 700 kilometre (2002) national road network, comprising over R30 billion in assets, excluding land (www.nra.co.za). The Agency operates as a ring-fenced commercial entity, able to focus on road management, maintenance, network expansion and private sector involvement in the provision of infrastructure. Private sector capital and private risk share have become commonplace in the construction and rehabilitation of primary roads. Freight-dominant routes are managed by various concessionaires, for example, the concession on the N3, the country’s busiest inter-city corridor, from Cedara, just north of Pietermaritzburg, through to Gauteng. Rural Secondary and Tertiary Roads The roads function within eight of the nine provinces operates on a traditional road authority structure that typically includes roads branches within the Department of Transport (DOT) or Department of Public Works. These branches are responsible for all road delivery functions such as policy formulation, planning and design, construction and maintenance, primarily through the use of private sector resources. The Limpopo Roads Agency and the Johannesburg Road Agency are examples of provincial- and municipal-level road agencies. Limpopo combines the traditional road authority structure to handle maintenance activities with a roads agency structure for the remainder of its functions. Other provinces are also investigating the road agency concept for the provision of road infrastructure. Municipal Roads and Streets Municipal authorities have responsibility for municipal roads and streets within their administrative areas. In smaller municipalities, the relationship between spheres of government is unambiguous with little conflict of interest. In metropolitan areas, levels of congestion are high and there is a need for an integrated approach. Unfortunately, effective planning and coordinated delivery is frequently hampered by a lack of integration. Within these areas, various parts of the road network and public transport modes are under the jurisdiction of metropolitan, provincial and national spheres of government. Most municipal roads authorities have a traditional road authority structure under ownership of the Council. Some have stronger maintenance teams that can also handle light construction activities, while others outsource all but routine maintenance activities. The City of Johannesburg Metropolitan Municipality has established a Roads Agency for its delivery arm, under the guidance of a Roads Agency Board. The ownership of roads still resides with the City, but the Johannesburg Roads Agency is responsible for the delivery of roads, based on a performance contract with the City’s contracting unit. As congestion becomes more severe and impacts more on the economic functioning of cities, it is imperative that coordination between national, provincial and particularly metropolitan institutions is improved. Urban Transport Infrastructure The provision of urban transport infrastructure under metropolitan or local government jurisdiction is carried out in terms of the Urban Transport Act (Act No. 78 of 1977) (UTA), which provides for the “planning and provision of urban transport facilities”, mainly the infrastructure component, and more recently, the National Land Transport Transition Act (Act No. 22 of 2000) (NLTTA), which has a strong public transport operations focus. The UTA provides for a municipality, or a number of district or local municipalities, to voluntarily form an agreement to undertake transport planning, including the infrastructure component. The provision of PART I CHAPTER 2 65 localised urban transport infrastructure is thus in the hands of the metropolitan, local and district municipal authorities, and has been so since the mid-1970s. However, a considerable proportion of roads, including all primary and secondary roads, traverse local authorities which have no jurisdiction over them. There is also no current jurisdictional control by metropolitan government over commuter railways. This makes integrated provision of transport infrastructure difficult to achieve, particularly in South Africa’s larger cities. It is the main movement corridors (primary and secondary roads and railway lines) where metropolitan government is likely to have the greatest influence on improving transport, yet it is these very corridors that frequently fall outside the jurisdictional or budgetary control of metropolitan government. This is despite the fact that most of this infrastructure is local in orientation and is used on a daily basis by residents of these areas. Continued growth of separate urban nodes, usually at concentrations of commercial, retail or even industrial activity some distance away from traditional Central Business Districts (CBD), has become a common phenomenon in South African cities. The result is that urban residents often travel further and are more reliant on a private car for their day-to-day travel requirements than in the past. This change in urban form creates significant challenges for urban transport infrastructure. The transport impact of new land use development needs to be better understood and the land use planning process should be better integrated with that of transport. One way to achieve this is to ensure adequately resourced and empowered transport authorities to manage all modes of transport within a specific geographical area. This is possible under the NLTTA. The Transnet Monopoly Transnet is a large transport operator and owner of infrastructure. While Transnet is now commercialised, it is wholly-owned by the State and operates a range of natural monopoly businesses. Transnet provides strongly centralised management control under a single Chief Executive. By 2000, the Transnet “stable” of operating divisions and subsidiaries comprised: Spoornet Long distance rail services Autonet Road transport services Portnet Control and management of all commercial ports Metrorail Commuter rail services South African Airways (SAA) Internal and external services Petronet Transport of petroleum products by pipeline PX Organisation for the consignment and distribution of containers. While the unbundling and privatising of Transnet was considered both before and after 1994, the structure and the operation of the company have remained more or less the same since April 1990. The exceptions are PX, which was sold in 2001, and Portnet, which was split into South African Port Operations (SAPO) and the National Ports Authority (NPA). More recently, further unbundling has been considered, with Transnet retaining rail, ports and pipelines as the core elements of the business, certain divisions (e.g. SAA) separated off and other divisions (e.g. Autonet) disposed of. It is proposed that the remaining entities be split into operational and infrastructure functions, as illustrated in Figure 13. 66 THE DBSA INFRASTRUCTURE BAROMETER Figure 13: The proposed structure of Transnet )PMEJOH $P 3BJM 0QFSBUJPOT 1PSU 0QFSBUJPOT 1JQFMJOF 0QFSBUJPOT "WJBUJPO 3BJM *OGSBTUSVDUVSF 1PSU *OGSBTUSVDUVSF 1JQFMJOF /FUXPSL 0UIFS 5SBOTQPSU1PSUGPMJP *OWFTUNFOU 1PSUGPMJP *OEFQFOEFOU3FHVMBUPST Source: Transnet, 2005 In the case of ports, the separation between infrastructure and operations was implemented in 2000. It was initially proposed in early versions of the National Ports Bill (2003) that the infrastructure component, under the jurisdiction of the NPA, would be removed from Transnet and would operate as an independent regulated state-owned entity. However, the poor financial position of Transnet is such that it relies on the revenues generated by the NPA to support the organisation as a whole. For this reason, the most recent amendments (2004/05) to the Bill retain NPA as a division within Transnet but with stronger regulatory oversight functions (Department of Transport, 2005a). Transnet’s performance remains an enormous challenge. In the 2003/04 financial year, Transnet posted a loss of R6.3 billion (Transnet, 2005a). This could have meant liquidation if Transnet had not been state-owned. The company is not only heavily indebted (gearing ratio of 83 percent), but the state of its assets is also poor; rail wagons are, on average, 25 years old and cranes within the ports equally as old (Stander, 2004). A number of studies by both Transnet and government have identified significant efficiency and performance problems within the parastatal (Stander, 2004). In addition, many of the larger divisions of Transnet are overstaffed, with skills levels that are low and poorly aligned to commercial best practice and a healthy customer focus. More recent performance at Transnet has been more encouraging, with a return to profitability in 2004/05 and a reduction in the gearing ratio to 67 percent. This shift is in part driven by the initial success of a fourpoint turnaround strategy for the organisation (Transnet, 2005): • Redirecting the business, including identifying operational synergies, establishing customer focus, enhancing the quality of infrastructure and turning Spoornet around, • Restructuring the balance sheet, including addressing the pension fund deficit, renegotiating contracts with key customers, disposal of non-core assets and transfer of SAA to Government, • Improving corporate governance, including a reformulated shareholder compact and establishing a performance management framework, • Improving risk management, by establishing appropriate risk procedures through a enterprise-wide risk management framework. Government’s intention in regard to the long-term future of Transnet now also seems clearer and provides the policy base to support the turnaround strategy. The separation of infrastructure from operations creates PART I CHAPTER 2 67 a mechanism for Government to sustain its role in infrastructure management, investment and delivery. The current operating environment in rail, ports and pipeline is presently dominated by Transet. It seems clearer now that these areas will slowly become open to participation by private sector players, beginning with the opening up of branch lines to small railway operators. Transnet’s CEO, Maria Ramos (Hill, 2005) recognises that many critical challenges remain. This includes the ability of the organisation to implement a R40 billion capital investment plan as a means to grow its core business. It also includes enhancing Transnet’s human resource capacity and skills base as a means to improve operational performance, customer service and ultimately to reduce the cost of transport to businesses across South Africa. More recent short-term challenges relate to labour action which has hampered progress with non-core disposals and organisational restructuring. Airports Responsibility for the provision and operations of the infrastructure at the nine major state airports has, since 1993, resided with: • The Airports Company of South Africa (ACSA), a commercial company • The Air Traffic and Navigational Services Company (ATNS), and • The State, as sole shareholder of ATNS and major shareholder of ACSA. The Civil Aviation Authority (CAA) promotes, regulates and enforces civil aviation safety and security and therefore has an indirect infrastructure responsibility. The Constitution of South Africa assigns concurrent responsibility for a range of secondary airports to the provinces and national government. Many of these smaller airports offer some regional or domestic services and are often also the home of a range of smaller charter and leisure operators. The White Paper on National Transport Policy (1996) makes no firm policy recommendation in respect to this situation, other than requiring consultation by ACSA and ATNS with all stakeholders, including provinces, in the development of air transport infrastructure. Twenty percent of ACSA was sold in 1998 to a consortium led by Aeroporti di Roma, an Italian airport operator. This represented the first significant departure from complete state ownership of core national infrastructure. It was widely accepted that an even greater shareholding in ACSA would be sold to the private sector, both through additional shareholding to Aeroporti di Roma and a public share offer, neither of which has occurred. In September 2005 the Public Investment Corporation (PIC) acquired the 20 percent stake owned by Aeroporti di Roma. This ends an era of a strategic equity partner for ACSA and brings almost full control of ACSA back into the hands of government. The sale is consistent with the Freight Logistics Strategy which emphasises government’s role in strategic infrastructure provision. However, as described by Chalmers (2005) this represents a shift in the policy of privatising large parts of the transport sector as was envisaged under the GEAR strategy. Coordination in the Provision of Transport Infrastructure (Primarily Road and Rail Infrastructure) In the 1996 White Paper, the Department of Transport stated: “The responsibility for infrastructure used by different transport modes is fragmented between different government departments and parastatals and also between different levels of government. The absence of a structure or mechanism for the coordination of the strategic planning for this infrastructure can lead, and has led, to “mis-matches” in infrastructure provision, inefficiencies in operation, and duplication of facilities with consequent sub-optimal utilisation. The country, with its scarce financial resources, cannot afford such a situation and it is necessary to bring together public sector bodies (at all levels) and private sector interests (including the construction industry) in an attempt to optimise resource usage as well as the transport infrastructure system. This structure will need to be cascading in nature to address infrastructure needs at the three levels of government as well as integrating the various elements of transport planning and infrastructure. A process with appropriate structures to coordinate planning to meet identified needs will be established to adequately respond to these needs.” 68 THE DBSA INFRASTRUCTURE BAROMETER Nearly ten years after the White Paper was issued, the problem still persists, and in certain cases may be regarded as a more significant issue than in the past, particularly in the case of infrastructure in Metropolitan areas. Institutional Environment The Constitution (1996) assigns responsibility for the provision and maintenance of infrastructure to all three spheres of government. This “concurrent” responsibility is necessary to empower delivery at the various levels of government, but it complicates delivery and results in some disjointed and uncoordinated decisions between different levels and arms of government. The new government inherited a centralist approach, where National Government played a dominating role in the organisation and control of urban railways, aviation and public transport subsidy, and had jurisdiction over most of the funding provided to the sector. Within rail, aviation and ports, the National Government continues to play a significant role. Prior to 1994, cities retained relatively low levels of control and provinces had jurisdiction only over secondary and rural road infrastructure. The 1996 White Paper provides a broad institutional and overall infrastructure management structure for transport, as summarised below. Roads The 1996 White Paper suggested that efficiency in the provision, maintenance and operation of the primary economic road infrastructure network will be facilitated by the establishment of a professionally-managed Roads Agency, with a Board of Control consisting mainly of users from the private sector. The White Paper is less clear about secondary, urban and rural roads where more traditional government management approaches have tended to dominate. Railways Rail is seen as an essential long-term component of the network for both freight and passenger transport. The White Paper identifies market need and commercial viability as the determinants of the provision and operation of rail infrastructure for bulk and general cargo freight transport, and for inter-city passenger transport. A national transport authority is identified as the owner of commuter rail infrastructure, rolling stock and land associated with rail reserves, until such time as the provincial or metropolitan transport authorities are able to take over this responsibility. The White Paper indicates that new commuter rail infrastructure will be determined by a combination of market needs and social considerations. Airports ACSA provides and manages infrastructure at the nine state airports. The White Paper acknowledges the existence of many smaller airports and recognises the need for a more holistic policy which provides direction on the need for management of these smaller airports. Whilst some clarity is observed since the White Paper process, no such policy has yet been provided. Seaports A port authority (or authorities) with specific responsibilities for the maintenance and development of port infrastructure was identified by the White Paper. Since it will be a monopoly, an independent regulator will regulate the port authority. The port authority will involve key role players in its strategic planning, for example, the metropolitan government of a city with a large port. The port authority will be independent of any port operating entity (or entities). The principle of competition within a port will be supported. The latest version of the National Ports Bill currently before Parliament is consistent with this requirement. Pipelines The White Paper identifies a network of liquid and gas pipelines that will be developed based on needs, operated as a utility and regulated by government. These continue to be owned and operated by Transnet. PART I CHAPTER 2 69 Financing Framework National, Provincial and Rural Road Infrastructure National and provincial roads in South Africa were traditionally funded through central fiscal allocations, a dedicated fuel “levy”, limited special allocations from government (generally for social development reasons), and private and government sector loan funding, generally redeemed by toll income. From the inception of the National Road Fund (NRF) in 1935, and up to April 1988, national roads were financed through this fund, which was sourced by a levy on liquid fuel usage. However, this “levy” constituted only a small fraction of the total taxes levied by government on liquid fuel, which has led to numerous debates on the difference between a levy and a tax. After government abolished the dedicated fuel levy on 1 April 1988, the NRF had to compete for funds from the central Exchequer on a similar basis as other government functions. In 1991, the Department of Finance introduced a system of multi-year planning of public expenditure, the purpose of which was to ensure a three-year continuity of programmed expenditure. In terms of this system, the Department of Transport was requested to develop a multi-year financial planning system for rural and inter-city roads. The purpose was to coordinate expenditure on this road infrastructure, to motivate for the allocation of an annual global sum for roads from the Exchequer, and to ensure an equitable allocation to the various road authorities of the total budgeted funds for rural roads. This system was not successful, primarily because the provinces were not amenable to executive, as opposed to political, decisions being made on their roads budgets. This system was discontinued in 1994 and replaced by a system through which provinces receive a global allocation for all their functions, inclusive of roads. Funds allocated to the NRF by Treasury were based on the (motivated) need for national roads and in relation to the total demands received by Treasury. This system continued until the South African National Roads Agency (SANRAL) was created in 1998, when a quasi-dedicated fuel levy approach was derived to fund its infrastructural (and other) activities. In terms of this approach, the SANRAL and its Board, on which a Treasury representative sits, draw up an annual budget, and this total sum is transformed into a cents/litre basis of fuel used for transport on the country’s roads. An additional source of funding for national road infrastructure on toll routes is loan financing, redeemed by toll charges levied on road users. This procedure was introduced in the early 1980s as a supplemental funding source for the NRF. At the time of the inception of this approach, the National Transport Commission (NTC) took a policy decision that not more than 15 percent of the national road network would be funded in this way. However, this approach has changed significantly, and now also includes the granting of long-term concessions (30 years or so) to private sector consortiums for the management (including infrastructure provision) of certain national roads. This has resulted in considerably more than 15 percent of the national road network being financed in this manner. Provincial roads continue to be financed by annual allocations from Treasury. These allocations are split into the various provincial functions based on the provinces’ own budgeting processes. The Reconstruction and Development Programme (RDP) fund, initiated by government in 1994, has also made some, though relatively small, allocations to rural road infrastructure. Figure 14 provides a schematic representation of road funding financial flows. From a revenue generation perspective, R15.9 billion is collected as a fuel levy and R1.7 billion is collected in the form of a vehicle licence fee (either by the provinces or by municipalities on an agency basis). Less than half of this revenue finds its way back to roads. Whilst fuel tax is a proxy for road usage, it is regarded as a general tax rather than a true user charge, in the same way as utility charges for water and electricity. As fuel is directly related to usage, it would be relatively easy to formulate a road user charge. However, similar to other countries, South Africa collects this charge as a general tax for a variety of reasons, not least of which are its relative ease of collection, the ability to target the relatively more wealthy, and the linkage between fuel use and the environment, implying a certain externality cost associated with fuel. 70 THE DBSA INFRASTRUCTURE BAROMETER Figure 14: Road funding financial flows, 2000/01 (Figures represent millions of Rand) Source: National Department of Transport, 2002 The actual backlog requirement for roads (capital and maintenance) remains under debate, although a 2002 estimate of a further R4.6 billion per annum for surfaced roads and R6.4 billion per annum for gravel and access roads is widely regarded as a reasonable estimate (Department of Transport, 2002). The ability to use the current fuel tax as both a general tax and a dedicated road user charge would go a long way to linking more closely the use of infrastructure with the budgetary allocation for creating and maintaining such infrastructure. This should be explored as a principle. The age of the road network has been steadily increasing, with more than 40 percent of national roads now more than 20 years old (SANRAL, 2002). This places additional pressure on the maintenance and rehabilitation backlog. An implication of delayed maintenance on roads is that preventative maintenance through an effective lifecycle maintenance programme is absent, leading to additional maintenance and rehabilitation costs. This situation is most acute at provincial level where 23 percent of roads are in “poor” condition and 12 percent in “very poor” condition. Improvements in management at provincial level would considerably enhance the effectiveness of lifecycle management, even within existing budgetary constraints (National Department of Transport, 2002). Urban Road and Street Infrastructure Urban roads and streets under the administrative control of municipalities are funded from municipal rates and taxes. The major sources of funds for municipal authorities are property taxes, loan funds for capital projects, parking fees and the partial repayment by the provincial authority of vehicle registration, licence fees and direct treasury allocations. In addition, national government may also provide funds to Transport Authorities, to enable them to perform the functions laid out by the NLTTA (2000). Rail, Ports and Pipeline Infrastructure Until the advent (1 April 1990) of the commercialised public enterprise, Transnet, the funding of infrastructure “owned” by South African Railways and Harbours (SAR&H) and South African Transport Services (SATS), was provided for by public and private sector loans redeemed from operating revenue. SAR&H and SATS were mandated by Acts of Parliament to operate their services on business principles, PART I CHAPTER 2 71 but with due regard to the economic interests and total transport needs of the country. They were, however, subjected to political interference. The consequence was that Transnet inherited a portfolio of divisions in which some profitable divisions were used to cross-subsidise other loss-making divisions. This has led to price distortions within the industry, with the generally very viable pipeline and port sectors subsidising the rail sector. The capital requirements for the provision of rail, port and pipeline infrastructure were funded from a central pool until 1991. This pool was financed from a variety of sources, including retained earnings, depreciation of assets, government loans, stock issues, export credits by supplier countries, bank facilities and internal stock issues/debentures. During the 1980s, a marked swing took place through the sourcing of loan funding, with government loans, accounting for 67 percent in 1978/79, reducing to 26 percent by 1982/83. With the creation of the Transnet “stable” of companies, rail, port and pipeline infrastructure is provided for within a divisionalised structure, and on a commercial basis, through loans and domestic bonds, listed on the bond excange, these are redeemed by retained revenue from the operation of services. This fairly bland statement masks the fact that Transnet inherited massive accumulated losses from SATS at the time of its inception in 1990. These losses lay particularly in non-operational items such as the actuarial deficit in the Pension Fund, as well as the inherited medical aid funds. Although Transnet was able to post moderate profits through the 1990s, its financial situation has declined significantly and, for some time, it has been unable to invest in the vast infrastructure network under its control. This has been recognised as a significant challenge to South Africa’s competitiveness and, in October 2004, the Minister of Public Enterprises announced a first-phase five-year capital investment strategy for Transnet (excluding SAA) of R37 billion. This will be used to sustain ongoing maintenance and reliability in service delivery. An additional R21 billion was identified for rail, port and pipeline network expansion. It is expected that public private partnerships (PPP) will be used to supplement and enhance this investment portfolio, with greater private sector involvement in traditional Transnet business areas than has been the case in the past (Department of Public Enterprises, 2004). Airport Infrastructure Until the advent of the Airports Company in 1993, the funding of the infrastructure for the more than 250 airports of varying sizes in the country was achieved using various sources. The large international and domestic airports were funded by the state, and the smaller ones by local authorities or private sector interests. Prior to 1993, the expenditure on infrastructure at the nine state-financed airports was provided by Treasury allocations to the annual budgets of the DOT (civil engineering and navigational aids expenditure) and the Departments of Public Works (buildings). Revenues generated at the state airports were traditionally not used to partially defray the cost of infrastructure but were paid directly into the State Revenue Fund. Further, state airports were not managed as financial units during this period, although information was available about the profitability of the various airports. During the period 1970 to 1990, funds available for airport infrastructure were considered inadequate by the Department of Transport (Mitchell, 2004), particularly in the light of the need to upgrade navigational equipment regularly and to cater for the rapidly growing demand for air transport facilities. Experience prior to 1993 was that, where facilities were necessary to stimulate regional development (e.g. George airport) or to meet a strategic need (e.g. Upington airport), funds were more readily available from the Department of Finance. Various large facilities, which were constructed through the historic defence budget and the “homeland” budgets, remained on the government’s books, and are proving increasingly difficult to maintain adequately. Since the creation of the Airports Company in 1993, infrastructure provision has been on a commercial company basis, with costs, including infrastructure costs, having to be met from revenue, loan financing and, where necessary, state capital. The revenue-earning potential of the civilian airports in particular has also grown substantially as freight and passenger demand has increased. This has created scope for ACSA to invest substantially in airports over the last decade. In 2003/04, ACSA invested R471 million in a variety of programmes, with more than half of these funds invested in the largest airport, Johannesburg International. Restructuring and Privatisation of Transport Infrastructure Since the 1996 White Paper, certain functions of the Department of Transport have been commercialised to “take out of the public service” certain administrative tasks, with the aim of “reducing bureaucracy” and improving efficiency and effectiveness in the delivery process. Referring only to the provision of transport 72 THE DBSA INFRASTRUCTURE BAROMETER infrastructure, the Airports Company of South Africa (ACSA) was created in 1993 to manage state airports, and the South African National Roads Agency Limited (SANRAL) was created in 1998 to manage national roads on behalf of the Department. In both cases, the company owns the infrastructure, but government is the majority shareholder (for national roads, the only shareholder). The term “privatisation” is very loosely used in South Africa in the context of transport infrastructure provision. Apart from the outsourcing of discrete design, construction and maintenance tasks, which has been practised for a number of decades, particularly in the roads field, the word is also applied to concepts such as commercialisation, concessioning and partnerships between the public and private sectors. The “concessioning of national roads” debate was re-opened early in the 1990s and enabling legislation was passed in 1996 for the concessioning of national roads to private sector consortiums. The first project was a section of route N1 between the then Nylstroom and Pietersburg. This was followed by three further concessions, totalling some 1 200 km. Proposals are before the NRA for a further group of such concessions to be awarded. Progress in privatisation has not been significant in regard to railway infrastructure. As a result of the major administrative and efficiency problems facing commuter rail services and rail freight transport during the 1990s, the DOT made proposals for the concessioning of both commuter rail and rail freight services, neither of which has gone ahead. Although a commercialised National Ports Authority (NPA) was created to separate port infrastructure from operations, it does not now appear to represent any significant move towards private sector involvement in port operations or infrastructure provision. In summary, the only two elements of transport infrastructure where any significant movement towards privatisation has occurred are in the provision of airport infrastructure and certain sections of national roads. It might be coincidence, but these are the two elements of transport infrastructure that appear to be in best shape and where significant new or rehabilitated infrastructure has been delivered during the last decade. The Perpetual Problem of Funding Transport Infrastructure During the past 50 years, transport infrastructure funding has originated from Treasury appropriations, municipal rates and taxes, dedicated fuel levies, government and private sector loans, bank facilities, stock issues and export credits by supplier countries. There is no effective coordination between modes, or between spheres of government in respect to the financing of transport infrastructure. Further, no comprehensive, overall transport infrastructure funding strategy has been prepared, matching financial resources with identified needs to develop infrastructure in a rational, integrated and coherent fashion. There are various possible reasons for this, but the prime reason appears to be the great degree of institutional fragmentation and overlap that has traditionally existed within the South African transport milieu – as discussed earlier. In addition, the non-availability of adequate funding levels to meet needs is a perpetual problem. Energy Introduction The electricity sub-sector has a number of active stakeholders, both public and private, whereas the liquid fuels and renewable energy sub-sectors are dominated by private players. Regulation presents a challenge in the sector as new policies and institutions are being established to level the playing field and to encourage greater participation by private players. The range of financial resources is limited as finance for electrification remains in the hands of government and Eskom, and the private sector continues to be responsible for developing the liquid fuels industry. Policy The policy is based on the 1998 White Paper on Energy Policy (refer Chapter 1). It has been expanded and amended by a number of new Acts. PART I CHAPTER 2 73 Institutional Structure and Ownership The energy sector is a mix of the public sector (i.e. municipalities, town councils, Eskom and PetroSA) and the private sector (i.e. independent power producers (IPP) and private companies) for liquid fuel, piped coal, natural gas and renewable energy. Electricity A schematic representation of the electricity system is given in Figure 15. It indicates the three main components of the system: generation, high voltage transmission and distribution to end-consumers. Figure 15: National electricity system (2002) (SPTT(FOFSBUJPO 58I %JTUSJCVUJPO1VSDIBTFTGPS &OE6TF 58I &OE6TF 58I %PNFTUJD 1SJWBUF (FOFSBUJPO .VOJDJQBMBOE0UIFS %JTUSJCVUPST "HSJDVMUVSF .JOJOH .VOJDJQBM (FOFSBUJPO &TLPN (FOFSBUJPO 5 3 " / 4 . * 4 4 * 0 &TLPN%JTUSJCVUPST $PNNFSDJBM 5SBOTQPSU 4"11 &YQPSUTGSPN4PVUI"GSJDB / 4"11JNQPSUTUP 4PVUI"GSJDB 74 .BOVGBDUVSJOH JOEVTUSJBM THE DBSA INFRASTRUCTURE BAROMETER (FOFSBM Box 9: Energy and the Environment In terms of environmental pollution, South Africa ranks among the top ten countries in the world. The main causes of pollution are from poor households and from industry. The burning of wood, dung, coal and paraffin in townships and rural areas is responsible for most of the household pollution. It is also a health hazard, causing respiratory illness on a large scale, especially among children. Burning of these fuels also leads to fires which claim many lives annually. The National Electrification Programme was part of Government’s strategy to overcome these problems. Households have also been encouraged to replace cheap paraffin stoves with improved stove or LPG stoves. The improved stoves are expected to comply with the South African Bureau of Standards (SABS). The DME started a low-smoke fuel programme to replace domestic coal with low-smoke coal that can be used in braziers or ‘mbaula’ for space heating. Kyoto Protocol: South Africa is a signatory to the Framework Convention on Climate Change (FCCC) and therefore required to pursue options for mitigating greenhouse gases (GHG). The Kyoto Protocol also enables members to benefit from the Clean Development Mechanism (CDM) where countries that invest in “clean technologies” can trade and earn carbon credits. The liquid fuel industry is further encouraging the use of clean technologies through its programme to phase lead out of petrol and reduced the sulphur content in diesel to 0.3% in 2002. Eventually, motor vehicle emissions will be legislated. The installation of catalytic converters in vehicle exhaust systems will assist to reduce carbon monoxide emissions. However, it is not mandatory for motor vehicle manufacturers to comply with this mitigation. Oil spills: In June 2000, a bulk ore carrier sank 10 km off the Western Cape coast just north of Robben Island. The ship was carrying 1 300 tonnes of fuel oil and most of it leaked into the ocean and reached the coastline. The leak immobilised tens of thousands of African Penguins. The event was recorded as one of the world’s worst coastal bird disasters by the International Fund for Animal Welfare (IFAW). Fortunately, more than 40 000 birds were rescued, cleaned, fed and returned to sea. Power generation: Eskom has very high environmental standards for its generation, transmission and distribution systems. The performance of power plant has been improved by the installation of electrostatic precipitators to reduce flue gas emissions, and air-cooling has replaced fresh water cooling at some of its power stations, such as Matimba and Kendal. The Koeberg Nuclear Power Station at the coast uses sea water cooling. Radioactive waste at Koeberg amounts to approximately 60 tonnes per annum. The waste is kept underwater for about 10 years in order to reduce its radioactive level by about 90%. Thereafter, the waste can be stored on site in steel casks. Power lines: For the past two decades, Eskom has worked together with the Endangered Wildlife Trust to monitor the preservation of endangered birds that accidentally fly into power lines and are electrocuted. By changing the design of the electrical infrastructure and altering the position of the power lines, bird mortality has been reduced significantly. It also reduced electrical faults caused by birds. Source: South Africa Energy Profile, 2003 The Department of Minerals and Energy (DME) has overall responsibility for policy direction and orientation of the energy sector in South Africa. It is also responsible for national programmes and the management of regional and international coordination in the sector. The DME has also been responsible for funding energy research and will soon establish a National Energy Research Institute (NERI). The DME reports to and advises the Minister of Minerals and Energy. Eskom Holdings Ltd (Eskom), created by the Eskom Conversion Act (Act No. 13 of 2001), is a vertically-integrated operation that is responsible for most (96 percent) of all electricity generated, all of its transmission and about half of its distribution in South Africa. The wholly-owned subsidiaries of Eskom Holdings include, amongst others, Eskom Enterprises, which carries out all the non-regulated activities, Eskom Finance Company (Pty) Ltd and Eskom Development Foundation (a Section 21 Company). Eskom is owned by government and pays dividends and company tax on profits declared. It reports to the Department of Public Enterprises and is governed by a board that is appointed by the Minister. Eskom’s reserve generating capacity is nearing minimum safe proportions and three mothballed power stations are being recommissioned. Approximately 3 500 MW of generation capacity will be recovered through de-mothballing. In addition, Government (2004) has advertised for expressions of interest from independent power producers (IPP) for two 500 MW open-cycle gas power stations for peak load power production (Department of Minerals and Energy, 2004). In terms of Part B of Schedule 4 of the Constitution of the Republic of South Africa, local governments are responsible for “electricity and gas reticulation” within their boundaries (Republic of South Africa, 1997, page 113). Electricity reticulation refers to the distribution of about 43 percent of national electricity use to mainly smaller consumers. In 2002, there were 188 licensed distributors (NER, 2002a) which were mainly owned and operated by the constituent local governments. The distribution of electricity by the large number of relatively small local government distributors has been extensively debated since the early 1980s. The lack of scale and specialisation has been seen as obstacles to efficiency and effectiveness. Since 1997, Cabinet has made a number of decisions designed to restructure the distribution sector to form a small number of regional distribution systems. Regional Electricity Distributors (RED), registered companies in terms of the Companies Act, would be formed and would absorb the distribution functions of local governments and of Eskom. A national restructuring company, EDI Holdings, was created in 2003 with the task of managing the restructuring process. Indications are that the first RED, which will be based in the Cape Town metropolitan area, will be up-and-running in July 2005 (Louw, 2005), with the second in Durban by the last quarter of 2005. A bottom-up process is followed whereby local governments can sign the Cooperative Agreement Pertaining to the Restructuring of the EDI in South Africa (DME, 2002a). They can then be included in the planning, analysis and negotiating activities. Progress has been PART I CHAPTER 2 75 slow and many problems have had to be addressed, the main ones being the narrow interpretation of the constitutional requirement that only local governments may reticulate electricity within their boundaries, and the understandable fear by local governments of the consequences of the loss of the surplus income that they earn on electricity sales, and that they use to cross-subsidise some of their other services. A small number of licensed generators exist in the private sector, as indicated in Chapter 3 (NER, 2002a). Most generate electricity for own use and do not supply power into the national grid. They are commercially funded by their owners and have to obtain a licence from the National Electricity Regulator (NER) when above a certain minimum size. Liquid Fuels The liquid fuel supply chain is illustrated in Figure 16. It indicates the activities of the acquisition and storage of primary energy, conversion to the different petroleum products, transport and storage and retailing to consumers. The sector consists of private oil companies, often related to international oil companies, local production of liquid fuels from coal by Sasol Limited and a public component through the Central Energy Fund (CEF). This component includes strategic stockpiles by the Strategic Fuel Fund (SFF) and production of liquid fuels from natural gas by PetroSA, off the south Cape coast near Mossel Bay. Figure 16: Schematic presentation of liquid fuel system Storage The strategic stocks of crude oil and the land and buildings that are used to hold the stock are state property. These facilities are at Ogies, Saldanha and Milnerton. PetroSA has been responsible since 2001 for the management of these strategic stocks and associated facilities. Each refinery includes tank farms for crude oil and refined products storage, and they are owned, managed and financed as part of the refinery. Refineries The four conventional refineries are owned and operated by private sector oil companies, in some cases in the form of a joint venture or partnership. Conventional private sector loan or equity financing is used for the expansion or modification of these plants. The two coal-to-liquid fuel plants are owned and operated by Sasol Limited, a listed private company on the Johannesburg Securities Exchange. The State’s involvement in the production of liquid fuels is through PetroSA, a subsidiary of CEF (Pty) Ltd that is governed by the CEF Act of 1977. Its refining operations convert gas and condensate to liquid fuels and the production of petrochemicals. PetroSA currently produces 8 percent of South Africa’s local refined fuel requirements and 5 percent of the national crude oil demand from local offshore oil fields. It is mandated to act as a fully commercial oil company and funding is obtained from own resources or the capital market. The Minister of Minerals and Energy appoints the Boards of CEF, SFF and PetroSA as stipulated in the relevant Act. Transport Pipelines and rail or road tankers transport crude oil and refined products. A 3 000 km high-pressure pipeline network, owned and operated by Petronet (a subsidiary of Transnet) traverses five provinces from KwaZulu- 76 THE DBSA INFRASTRUCTURE BAROMETER Natal to Gauteng, transporting crude oil from the coast to the Natref inland refinery and refined petroleum products to inland depots. The pipeline network therefore belongs to the State and Petronet reports to the Ministry of Public Enterprises. Rail tankers are owned and operated by Spoornet, also a subsidiary of Transnet. Road tankers are owned and operated by the oil or independent companies. Depots and Filling Stations The oil companies are responsible for all liquid fuel wholesale activities, including transport, depots and storage. The following companies were involved in 2002: Afric Oil, BP, Caltex, Engen, Exel, Sasol, Shell, Tepco, Total and Zenex. As vertical integration is not allowed, independent fuel station operators, of which there are about 5 000, carry out retail activities, often from premises that belong to oil companies and are leased to the operator. Natural Gas Production Sasol produces both hydrogen-rich and methane-rich gas from coal at Sasolburg and Secunda respectively. In addition, it imports natural gas from the Pande and Temane gas fields in Mozambique. As previously indicated, PetroSA operates an offshore natural gas field off the south-east coast of South Africa for the production of liquid fuels at its refinery at Mossel Bay. Ownership, governance and financing follow private sector and public sector principles respectively. Pipelines Sasol delivers pipeline gas through a 1 550 km pipeline network to more than 500 industrial and commercial customers in Gauteng, Mpumalanga, Free-State and KwaZulu-Natal. The connection between the Gauteng and KwaZulu-Natal systems is by means of a Petronet pipeline. In 2004, Sasol commissioned its 865 km pipeline from the Pande and Temane gas fields to Secunda, for which it used commercial financing. Regulation of the latter pipeline is by means of an agreement with government pending the setting up of the gas pipeline regulator within the new National Energy Regulator of South Africa (NERSA). NERSA will be a body consisting of the NER plus gas and liquid pipeline regulation, and is planned to be in operation later in 2005. It is described later in the report. The only gas system for the household market is eGoli Gas that serves about 12 000 households in Johannesburg. Sasol supplies the gas from its Sasolburg plant (Central Energy Fund, 2005). The state has set up a company within the CEF Group of Companies, named iGas (Pty) Ltd, with the intention of developing the hydrocarbon gas industry in South Africa by introducing natural gas into the economy competitively (Central Energy Fund, 2005). iGas has the right to 25 percent of the capacity of the Sasol pipeline from Mozambique. The option of introducing liquefied natural gas (LNG) is presently being investigated. Nuclear Energy The Nuclear Energy Act of 1999 replaced the Atomic Energy Corporation with the South African Nuclear Energy Corporation (NECSA), responsible for developing nuclear expertise, including the disposal and management of nuclear waste. The only nuclear energy production facility is the Koeberg Power Station close to Cape Town. It forms part of the portfolio of power stations owned and operated by Eskom. The Pebble-Bed Modular Nuclear Reactor (PBMR) has been developed by an international consortium led by Eskom and has been partly funded by the Department of Science and Technology (DST). This development is apparently ready for full-scale demonstration, most probably by means of a 150 MW full-scale experimental unit at the Koeberg site. Cabinet approval has been given and an Environmental Impact Assessment (EIA) completed. This assessment has been referred back to the Department of Environmental Affairs for specific revisions as a result of a court interdict that was obtained by an environmental group, also in terms of the procedures that have been adopted. Renewable Energy As renewable energy, especially in its modern forms, is fairly new to South Africa, no database exists that indicates the extent of infrastructure investment. It is understood that the DME is investigating the development of such a database (DME, 2005b). PART I CHAPTER 2 77 Wind Apart from the one licensed wind energy installation (Klipheuwel Wind Project) initiated by Eskom, the other installation of the same type and size is the Darling Wind Project. Both installations are in the Cape Province. The Darling project is in the planning, approval and negotiation phase. This will be owned and operated by a private sector company and it is understood that a power purchase agreement has been concluded with the Cape Town Municipality. Funding will be a mix of grant funding by an aid organisation and a loan by the DBSA and CEF through the Energy Development Corporation (EDC). This project is making slow progress and a number of hurdles still have to be cleared. Micro-Hydro There are a small number of micro-hydro installations, some of them are experimental projects and others developed by farmers for their own activities. New mini- and micro-hydro plants are currently being developed. Solar Photovoltaic A number of photovoltaic systems have been installed, mostly in isolated locations. These are mainly: • Systems for the telecommunication industry (Telkom, SABC, cell phone companies) • Systems on remote farms and game reserves. • Four concessionaires were contracted by the DME to install solar homes systems (SHS) in rural areas where grid electricity is expensive. Almost the full capital cost of R3 500 was provided as a capital subsidy by the DME. About 20 000 of these small systems have been installed at a total cost of about R70 million. These systems produce a maximum of 50 W of electricity under rated conditions when the solar beam is perpendicular to the solar panel. In all cases, excluding the SHS concessionaire project, the developer supplied the funding. No formal regulatory approach was followed, other than the registration by the NER of the licensed area allocated to the four concessionaires. Solar Water Heaters Solar water heaters of various types and sizes have been marketed since the 1970s, mainly for medium-income housing. They have only captured a small part of the market because of high costs in relation to the low cost of electricity and lack of any form of government support. Financing is commercial at market rates, often as part of the home loan. No national regulation is implemented although a number of SABS specifications exist. Local authorities may require planning approval. Regulatory Environment Electricity Regulation The National Electricity Regulator (NER) that was created by the Electricity Amendment Acts of 1994 and 1995 regulates the total electricity sector as a de facto monopoly. Regulation consists of the issue of licences to operate specific plants, facilities and systems. The main purpose of regulation is not only to protect the user against monopoly abuse but also to ensure that activities take place economically. A large component of the regulatory regime is the approval of tariffs and price increases. Regulation has also recently included additional requirements of incentivising improved business performance, a satisfactory quality of supply, the use of integrated energy planning and the support by licensees of programmes for the efficient use of energy by end-consumers. Nuclear Regulation Regulation of the power production component is undertaken by the NER, and by the National Nuclear Regulator (NNR) in respect to safety and health. The NNR was created by means of the National Nuclear Regulator Act (Act No. 47 of 1999). The NNR is responsible for the licensing of all nuclear operations. Liquid Fuels Regulation Over the years, a variety of approaches were used to regulate this sector, consisting of different approaches to price control and regulating the location of retail facilities. At present, certain prices are controlled directly 78 THE DBSA INFRASTRUCTURE BAROMETER by government, being the retail selling price of petrol and wholesale price of diesel and illuminating paraffin. Retail facilities were regulated in terms of a quota system in the form of a compact with the fuel industry. In terms of the Petroleum Products Amendment Act (Act No. 58 of 2003), the Controller of Petroleum Products, a yet-to-be appointed official within the DME, will regulate the petroleum sector by the licensing of persons/concerns for the manufacture or selling of these products. Past legislation did not require licensing because order was maintained by an agreement between the oil companies and the DME in the form of a quota system. These licences will include requirements for transformation and will prohibit specific activities. Government’s policy is to prevent anti-competitive behaviour, including an embargo on vertical integration, so that oil companies are not allowed to distribute liquid fuels (wholesaling) and sell them to consumers (retailing). Steps are also being taken to regulate the pipeline component of the petroleum sector. The NER will become the National Energy Regulator for South Africa (NERSA) when, among other responsibilities, it starts implementing the Petroleum Pipelines Act (Act No. 60 of 2003) (NER News, 2005). This will regulate the technical aspects of petroleum pipelines as well as tariffs, based on a return on investment approach. A change management programme and communications strategy have been implemented and the intention is to complete all that is necessary to create NERSA by the end of June 2005. This regulator will be funded in part by a levy on the income earned by the pipeline network in terms of the Petroleum Pipelines Levies Act (Act No. 28 of 2005). Environmental Regulation Environmental regulation is in terms of national legislation of the Department of Environmental Affairs as implemented by local governments. Enviromental Impact Assessments (EIA) are required for all new facilities in excess of a specific sub-minimum (refer Box 9). Safety Regulation Depending on the specific sector, the Factories Act, as administered by the Department of Labour, regulates most safety aspects. Licensed Renewable Energy Systems The installation of small renewable energy systems is not regulated. In terms of the Electricity Act, renewable energy systems that generate electricity for sale to others are regulated by the NER. The renewable energy power stations (NER, 2002a) that have been licensed by the NER in terms of this requirement are given in Table 7. Table 7: Licensed renewable energy systems producing electricity Type Bagasse Number Capacity (MW) Ownership 5 105 10 668 Wind energy 1 13 Biomass 1 17 17 803 Hydro Total PART I CHAPTER 2 Private, sugar industry 6 Eskom (661 MW), 3 municipal, 1 private Eskom: Klipheuwel experimental facility Private, not yet under construction 79 Financing Framework Eskom finances its infrastructure by means of internal sources, borrowing on capital markets and issuing long-term bonds. Eskom has a good credit rating and secures its borrowings on the strength of its balance sheet. Because of the extensive changes within local government, and in particular the impending restructuring in the form of REDs, most of South Africa’s local governments will, or do, find it difficult to obtain funds for energy infrastructure investment on the capital markets. National funds are allocated to local authorities either in a non-earmarked manner (the “equitable share”) or for dedicated infrastructure projects under the Municipal Infrastructure Grant (MIG) programme. The MIG targets the capital expenditure required to address bulk infrastructure backlogs to low-income households in the four service areas: electricity, water, sanitation and refuse removal. With respect to local sources of funding, there is a complex mix of budgetsharing between municipal responsibilities, characterised by inter-service subsidisation, intra-service crosssubsidisation and allocations to social responsibilities. This approach results in a “leakage” of the surpluses on electricity distribution, in that these surpluses are used to part-fund other services in most, if not all, municipalities. The financing of electrification infrastructure by both Eskom and local governments is by way of Treasury funds through the DME budget in terms of a national electrification plan that the DME develops and manages. Some R1 126 million has been budgeted for the national electrification programme in 2005/06. The financing of liquid fuel and pipeline gas infrastructure is handled by the liquid fuel industry. Funds are obtained on the capital market on the strength of the balance sheet of the specific company. This applies to the private sector elements as well as PetroSA and Petronet. Funding for renewable energy installations is limited as these activities consist mainly of demonstration projects, for which a mix of aid, commercial and governmental funding and grants is involved. A summary of the funding for energy infrastructure is given in Table 8. Table 8: Summary of energy infrastructure funding Sector Electricity generation, Eskom Transmission, Eskom Distribution, Eskom Distribution, local government Electrification of townships Crude refineries and marketing Sasol, refinery and marketing Sasol, gas pipeline Oil pipelines Renewable energy Capital expenditure in 2002 (R million) Estimated capital expenditure funding gap (R million) 736 No gap at present 279 Small 1 275 Small NA 9 300 total 899 12 400 Comment From about 2008, R9 000 million per annum will have to be spent on additional capacity, based on an assumed growth in electricity demand of 3% per annum Future funding will most probably be the responsibility of the REDs Based on 100% connections to households 668 8 000 to 10 000 Upgrade of refineries for clean fuel production 1 582 2 800 Small, NA NA Small Pipeline completed in 2004 No investment as yet announced 17 800 Over ten years to satisfy renewable energy target (Nassiep, 2004) Note: Electrification is the reticulation of new townships, mainly at the voltage of supply of 250 Volt. It includes in-township medium voltage cabling, mini-substations, house connections, metering and basic in-house wiring. Distribution comprises those activities at medium voltage, from 11 to 132 kV, that bring the main supply to larger customers and to townships. Source: Basson, 2004 80 THE DBSA INFRASTRUCTURE BAROMETER Water and Sanitation Introduction The entire water and sanitation sector has benefited from a complete overhaul by the new government since 1994. Water services have been deliberately focussed on addressing those who have been underserved in the past, and government grants have increased accordingly. Water resource policy and legislation is now state-of-the-art and the envy of many water-stressed nations. However, building the human and institutional capacity to implement all the new legislation will take considerable time. Policy Water Resources and Irrigation Water resource policy and laws are set out in the 1997 White Paper and the National Water Act of 1998 (Act No. 36 of 1998). A very brief non-comprehensive and non-detailed summary is provided here (Eberhard, 2004). Water Rights Water rights are clearly spelled out in the National Water Act. This Act marked a significant departure in the treatment of water rights. In terms of the Act, national government is custodian of water on behalf of the people of South Africa. No rights to water are given in perpetuity. Water rights are separate from land ownership. Water rights are given in terms of general authorisations for specific kinds of (limited) uses and special authorisations. Special authorisations are given in terms of licences. In future, all water users will be required to register and apply for water use licences. These licences are term limited (the length depending on the nature of the use) and may contain other specific conditions of use. Forestry is regarded as a water user and must apply for and obtain licences for water use. The implementation of compulsory licensing is prioritised where catchments are declared to be water-stressed. The water licensing system is in its infancy and it is too early to determine its effectiveness. Concerns have been raised relating to the availability of adequate capacity to properly manage, administer and regulate the system. Such concerns could be addressed through, for example, the development of secondary markets in licence allocation. Catchment Management In terms of the National Water Policy and National Water Act, the intention is to create 19 Catchment Management Agencies (CMA) which will manage water resources within defined Water Management Areas (WMA). Each WMA will be managed in terms of a Catchment Management Strategy (CMS) which is consistent with the National Water Resource Strategy (NWRS) (DWAF, 2004a). DWAF is fulfilling the functions of the CMAs until such time as they are created. Water Services A new policy framework, Strategic Framework for Water Services, was developed and approved by Cabinet in September 2003 (DWAF, 2003). This is a comprehensive policy framework which draws together and extends or revises the policies contained in the 1994 Water Supply and Sanitation Policy White Paper and the Water Services Act (Act No. 108 of 1997). It also takes into account the new municipal policy and legislative framework as set out in the Municipal Structures Act 117 of 1998 and the Municipal Systems Act 32 of 2000. Key policies are summarised here. Water Services Authorities Water Services Authorities (WSA) are constitutionally responsible for the provision of water services. WSAs have a right but not an obligation to provide industrial water to, and/or to accept industrial wastewater from, industries within their area of jurisdiction. A New Role for DWAF DWAF will devolve its operational responsibilities with respect to water services and will become the sector leader, supporter and regulator. PART I CHAPTER 2 81 The Water Ladder National Government is committed to eliminating the backlog in basic water services and to progressively improving levels of service over time in line with the original aims of the Reconstruction and Development Programme (RDP) of 1994. The first step up the water ladder is the provision of at least a basic water and sanitation service to all people living in South Africa. This is the most important policy priority and government will commit adequate funds to make this possible within the next few years. The next step is an intermediate level of service, such as a tap in the yard. Water services authorities are expected to assist communities to achieve intermediate and higher levels of service wherever practical, affordable and sustainable, but without compromising the national policy priority of universal access to at least a basic level of service. National Government will increase its commitment of grant funds over time to support households to step up the water ladder. Institutional Reform, Water Boards and the Private Sector The capacity to provide services effectively and efficiently is a critical constraint in many areas of South Africa. Government will play a leading role in promoting institutional reform to ensure that capacity is used optimally and that efficient and sustainable water services providers are established. This process of institutional reform will promote the regional integration of water services where appropriate. Water Boards will be transformed as part of this process. The role of the private sector in the provision of water services is allowed, provided that consumer interests are protected, but the policy expressly states a preference for public sector service provision. Sector Targets Explicit sector targets are set out in the Strategic Framework. These include universal access to water by 2008 and universal access to sanitation by 2010. Institutional Structure Water Resources The National Department of Water Affairs and Forestry (DWAF) is responsible for water resources management in South Africa. The management of bulk water facilities, mainly dams and canals, is located within a branch of DWAF which is being ring-fenced as a forerunner to the recently – approved national water resource infrastructure agency, to be run as a stand-alone entity. It is intended to progressively decentralise the responsibility and authority for water resource management by establishing Catchment Management Agencies (CMA) in each of 19 major catchments, but this will take time. Only one CMA, for the Komati River, has been established to date. Although it was established in March 2004, the Governing Board has yet to be approved by the Minister (Sonjica, 2005). A further five CMAs are currently the subject of feasibility studies. It is intended that these organisations must be representative of all water users and will facilitate effective participation in water resource management. CMAs are statutory bodies and will have jurisdiction in defined Water Management Areas (WMA) to manage water resources and to co-ordinate water-related activities. Existing Irrigation Boards are required to be transformed to become Water User Associations (WUA), after consultation with the “likely to be” affected individuals and organisations, and subject to the approval of the Minister of Water Affairs and Forestry. WUAs fall under the authority of CMAs and are cooperative associations of individual water users who undertake water-related activities for mutual benefit. They operate in terms of a formal constitution and are expected to be financially self-supporting from income received through water use charges. New WUAs may be established and the DWAF will support the process of building capacity of subsistence and emerging farmers, enabling them to obtain subsidies in terms of the strategy for water user charges (DWAF, 2004a) (Backeberg, 2005). Water Services Municipal Both municipal water supplies and sanitation services are divided into wholesale or bulk (e.g. dams, treatment works and major service reservoirs) and retail. Most towns arrange their own bulk water services, including dams where necessary, but where there are limited resources and multiple users, it is common for a Water Board to be responsible for the wholesale supply of potable water. In rural areas, extensive schemes serving several communities are the norm. 82 THE DBSA INFRASTRUCTURE BAROMETER The Water Services Act (Act No. 108 of 1977) formally separates the roles of the Water Services Authority (WSA) (the politically accountable council) and the Water Services Provider (WSP). The latter can be in the form of a number of different entities, including municipal department, municipal entity (wholly-owned utility), Water Board, neighbouring municipality, NGO, CBO or a private sector company. A small number of private sector contracts exist in urban water services, including two 30-year concessions and several management contracts. Recent determinations in terms of the Municipal Structures Act allocated the powers and functions of the WSA to most local municipalities (category B), but where local capacity was deemed to be inadequate, the authority function was allocated to the district municipality (category C). Of the 284 municipalities (metros, Bs and Cs), 170 are currently functioning as WSAs. It is still too soon to judge how successful this allocation of responsibilities has been. It was a difficult exercise which might have generated some anomalies. Some determinations have been challenged and are currently under review. DWAF is in the process of transferring to municipalities schemes that it inherited from homeland governments in 1994, plus those that it has constructed since 1994. A total of 317 water supply schemes are to be transferred to 55 WSAs. 30 percent of schemes had been transferred by April 2005 (DWAF, 2005a). There are also nearly 1 000 rudimentary supplies (e.g. spring protection, boreholes) to be transferred. DWAF, SALGA, DPLG and National Treasury have agreed upon a Joint Transfer Policy to guide implementation. However, the process has been slowed by municipalities’ lack of capacity to manage the schemes, as well as reluctance to take over schemes that may have a variety of technical, administrative and financial problems. Water Boards Details of the 15 existing Water Boards, which vary in size, are given in Table 9. The one bulk sewage treatment company, ERWAT on the East Rand, is owned by the municipalities it serves, otherwise almost all municipalities run their own sewage treatment works. Table 9: Details of Water Boards Water Board (In order of volume of treated water supplied) Rand Water Staff Population served 1 (‘000s) Service area (km2) No. Water supplied Percent Treated (million kl/y) Raw Percent (million kl/y) 10 000 18 001 3 172 46.8 1 147 61.9 4 302 32 000 1 050 15.5 342 18.5 Sedibeng Water 1 600 86 000 595 8.8 79 4.3 Lepelle Northern 1 000 82 000 263 3.9 77 4.2 Mhlathuze Water 380 37 000 164 2.4 51 2.8 92 800 35 150 244 3.6 49 2.6 16 1 530 4 008 6 0.1 36 1.9 Umgeni Water Bloem Water Ikangala Water Botshelo Water 821 49 858 388 5.7 19 1.0 Amatola Water 1 200 43 400 233 3.4 19 1.0 Bushbuck Ridge 1 200 12 320 282 4.2 14 0.8 Magalies Water 800 35 000 281 4.1 6.9 0.4 Overberg Water 2 070 6 700 70 1.0 5.0 0.3 Pelladrift Water 7 9 531 0 0.0 4.5 0.2 Namakwa Water 45 1 487 26 0.4 3.7 0.2 Albany Coast Water 10 6 0.1 0.4 0.0 24 235 6 780 TOTAL 1 853 6 114 Note 1: Figures for population served are provided by Water Boards and may not be accurate. Source: South African Association of Water Utilities, 2003 figures (Eberhard, 2004) PART I CHAPTER 2 83 Regulation Water Resources and Irrigation DWAF deals with water abstraction and storage allocations, and the authorisation of afforestation development. It is currently designing and consulting on a strategy for compulsory water use licensing to facilitate equitable access to water resources for previously disadvantaged communities. This will also enable DWAF to enforce the ecological Reserve for each stream identified in the National Water Resource Strategy (NWRS). Water quality management in South Africa has evolved from a pollution control approach, which concentrated on source-directed management measures, through a receiving water quality objectives approach, which recognised the water quality requirements of receiving water users and the aquatic ecosystem, to the current integrated source, remediation and resource-directed management approach as contained in the National Water Act. The first regulations under the Act govern the use of water for mining and related activities, and are aimed at protecting water resources. DWAF has also prepared and administers minimum requirements for waste disposal in landfills, and the handling and disposal of hazardous waste. The DWAF dam safety office registers all dams throughout the country and has a database of 6 000 dams of all sizes. It also reviews the design and performance of dams with a certain safety risk profile. Current regulations require it to oversee dams with a height of more than 5 metres and a storage volume exceeding 50 000 m3, or those with an abnormally high risk for other reasons. Refer to Chapter 3 for more information on dams. Water Services Government is committed to developing and implementing a strategy to improve the regulation of water services. This will take place within the Strategic Framework for Water Services (DWAF, 2003a). The key elements of this framework are highlighted below and Figure 17 provides a schematic overview: • The regulatory role to be played by Water Services Authorities will be supported by national government. Municipal by-laws form the basis of local regulation • National government will focus on three areas of regulation: compliance with national norms and standards, contract oversight and economic regulation • National government requires from each of the 170 WSAs an annual Water Services Development Plan (WSDP) against which progress can be measured. Figure 17: National Regulatory Framework for Water Services Source: DWAF, 2003 84 THE DBSA INFRASTRUCTURE BAROMETER Financing Framework Water Resources and Irrigation The Trans Caledon Tunnel Authority (TCTA), which was originally set up to finance and manage the South African side of the Lesotho Highlands Water Project, has recently been involved in raising the R1.5 billion finance required for the new Berg River dam for Cape Town. The proposed National Water Resource Infrastructure Agency, recently approved by Cabinet, will develop and manage the infrastructure identified in the NWRS. The Strategy identified 18 major projects that may be required over the next 20 years at a cost of at least R21 billion (Sonjica, 2005). Water Tariffs Water uses are defined in Section 21 of the National Water Act and include the following categories: abstracting and storing water and stream flow reduction activities (only commercial forestry has so far been declared a “flow reduction activity”); altering, impeding or diverting flows in a water course; and use of water for recreational purposes. A national raw water pricing strategy has been developed in terms of Section 56 of the National Water Act. The strategy provides for charges for: • Water resource management. This charge is levied to pay for the costs of water resource management. The charge is typically a few cents per kilolitre. • Paying for water resource related infrastructure. This is called a water resource development charge when applied to government water schemes. The charge is based on a real return on assets of 4 percent (depreciated replacement value assets). A typical charge is 30 cents per kilolitre, but this can exceed100c/kl. • Waste discharge. A waste discharge charge system is under development. • The right to use water. This is an “economic charge” related to the scarcity of water. The charge is to help achieve the equitable and efficient allocation of water. The charge may be administratively determined (based on opportunity cost of water) or be determined through public tender or auction, or possibly through trading. The charge has not yet been implemented. Financial Assistance The areas under irrigation can be usefully categorised in terms of financial assistance received from government for their water supply costs. The categories are: • Private irrigation farms, comprising approximately 40 percent of the irrigated area. The costs of irrigation development have been met by the owners of the land themselves. • Irrigation Board Schemes, comprising about 30 percent of the irrigated area. Government has paid a one third capital subsidy for Irrigation Board Schemes. There has been no government assistance to cover the costs of operation and maintenance. Irrigation Boards have typically been established through local initiatives in the commercial farming areas. There are more than 300 Irrigation Boards in South Africa. • State Irrigation Schemes, comprising 30 percent of the irrigated area. These include the white settlement schemes dating from the 1930s, and the former Bantustan schemes dating from the early 1950s. The full capital cost of these schemes was paid by government. In addition, government has provided substantial operational and maintenance subsidies (Vaughan, 1997). Subsidies have also been made available to small-scale emerging farmers to establish irrigation infrastructure. Subsidies amounting to more than R27 million were reported to have been provided in 2003/04 to some 630 emerging farmers in Mpumalanga and the Western Cape for almost 2 000 hectares of irrigated land (National Treasury, 2004). Water Services The financial framework for water services reflects the consolidation of national funding to local government through the municipal infrastructure grant (MIG) and the capacity-building grant. Municipalities also receive a recurrent subsidy from the “equitable share” of nationally-raised revenue. This is constitutionally mandated as an unconditional grant that is intended to assist with the provision of services to the poor. The formula for its allocation is largely based on the number of poor households in a municipal area. There is some discussion about whether the current and projected allocations are adequate for those areas where the numbers of poor households predominate and the costs of water services are high. PART I CHAPTER 2 85 Municipal Investments Information on capital expenditure budgeted by municipalities for the year 2002/03 has been provided by National Treasury. Municipalities have been divided into six groups so that the figures can be analysed (refer table 46) (National Treasury, 2003): • Metros (6 municipalities with 31 percent of households) • B1: Secondary cities (top 21 local municipalities, with 18 percent of households) • B2: Local municipalities with a medium-to-large town as core (31 municipalities with 9 percent of households) • B3: Local municipalities with a small town or several small towns as core and with a relatively small rural population (119 municipalities, with 21 percent of households) • B4: Largely rural municipalities (60 municipalities, with 23 percent of households) • District municipalities (47). Table 10 clearly indicates the low levels of capital budgeted by B4 local municipalities and districts. This is of concern as these are the areas where the greatest backlogs occur. Using data from the same source, a summary of the way municipalities anticipate financing their capital expenditure for all services (not just water and sanitation) is given in Table 11. Table 10: Water and sanitation, budgeted capital expenditure by municipal group, 2002/03 Water Group No. of households Capex (R’000s) Capex per household (R) Sanitation Percent of all municipal capex Capex (R’000s) Capex per household (R) Percent of all municipal capex Total capex (all municipal services) (R’000s) Metros 2 526 639 546 745 216.39 10 313 159 123.94 6 5 238 173 Group B1 1 473 426 202 266 137.28 17 72 891 49.47 6 1 169 721 Group B2 719 867 35 861 49.82 12 24 456 33.97 8 289 120 Group B3 1 697 044 113 567 66.92 18 4 809 29.35 8 616 490 Group B4 1 829 033 60 657 33.16 29 10 782 5.89 5 211 115 Districts 5 836 300 177 597 30.43 36 13 647 2.34 3 493 226 Total 8 246 000 1 136 693 80.72 14 484 745 34.42 6 8 017 845 Notes: 1. Figures from National Treasury database. 2. Household figures are from 1996 census. 3. Districts not included in count of total households as their population is included with ‘B’ municipalities. 4. An unknown part of these figures will be for local bulk water resources development, in addition to that recorded under DWAF and Water Boards. Table 11 clearly shows the relative financial strength of the Metros and Group B1 (local) municipalities. They are able to mobilise internal surpluses for capital expenditure and, with a strong balance sheet, approach banks and other investors for loans and bonds. At the other extreme, the bottom three groups are highly dependent on government grants. Further, and as spelled out by the analysis in Chapter 5, these same under-resourced municipalities, serving large numbers of the poor - mostly rural - will struggle to raise sufficient revenue and recurrent subsidies to meet regular operations and maintenance costs. 86 THE DBSA INFRASTRUCTURE BAROMETER Table 11: Budgeted capital financing by source (all municipal services), 2002/03 Group Capital financing (R millions) Grants National Loans Provincial Internal Other Total Total Metros 292.40 657.53 949.93 788.20 2 578.07 921.97 5 238.17 Group B1 133.32 124.96 258.27 316.75 356.26 238.44 1 169.72 Group B2 49.02 37.25 86.27 32.57 128.86 41.42 289.12 Group B3 169.28 73.35 242.63 38.16 178.50 157.20 616.49 Group B4 124.43 5.27 129.70 0.20 24.48 56.74 211.11 Districts 162.97 92.21 255.18 5.22 88.69 144.13 493.23 Total 931.42 990.57 1 921.99 1 181.11 3 354.86 1 559.89 8 017.84 12 12 24 15 42 19 100 Distribution (%) Water Boards Information on capital expenditure by Water Boards has been abstracted from the cash flow statements presented in their annual reports and are summarised in Table 12 (National Treasury, 2003). Table 12: Capital expenditure by Water Boards Water Board Capital expenditure 2001/02 (R’000s) Percent of total Rand Water 265 642 62 Umgeni 120 024 28 28 007 7 Bloem 3 801 1 Amatola 3 225 1 Lepelle 2 116 0 Overberg 2 070 0 Sedibeng 570 0 Albany Coast Mhlathuze 446 0 Ikangala 8 0 Magalies 3 0 Namakwa 0 0 0 0 Bushbuckridge Pelladrift No data Botshelo No data Total 428 000 100 Capital expenditure by Water Boards for that year was thus of the order of R500 million, mostly for water supply (including an unknown amount for water resource development), compared with R1.1 billion in municipal budgets. PART I CHAPTER 2 87 Information and Communications Technology (ICT) Introduction The telecommunications sector continues to be characterised by growth, super-profits, licensing delays and only recently new foreign investment in the sector. Even with the advent of black economic empowerment (BEE), Telkom and other telecommunication companies have experienced job losses. The high cost of telecommunications remains one of the barriers to achieving the critical mass for telecommunications to impact positively on development. Fixed-line call charges have escalated at a compound annual growth rate of more than 21 percent since 1997, thwarting growth in vital new industries, such as call centres, with potential new job opportunities (Gillwald and Esselaar, 2004). Current problems include the failure to extend the roll-out of affordable fixed-line services and the high costs of telecommunications services. But the policy regime reflects the realities of convergence between mobile and fixed services, both between broadcasting and telecommunications and between production and distribution. The evolving policy regime could enable more effective licensing and regulation and create an environment more conducive to foreign investment. In the proposed convergence legislation, the real challenge will be to ensure the continued extension of the network into those rural areas regarded as commercially unattractive. Telecommunications penetration continues to be extended through mobile telephony, with total household penetration by both fixed-line and mobile telephone 47 percent (Statistics South Africa, 2003a; International Telecommunications Union, 2003; Gillwald and Esselaar, 2004). With the expansion in telephone connectivity and cellular phones, around 90 percent of South African households are within 30 minutes walking distance of a telephone that they can access and use (Botha, 2004). Policy The Department of Communications (DOC) is the policy-making body for the post, telecommunications and broadcasting services in South Africa. It influences the roll-out of telecommunications infrastructure. It faces the challenges of correcting imbalances in communication services and preparing South Africa to take advantage of the convergence in communication technologies. This will make it globally competitive by becoming a hub of multi-media development and contributing towards an African communications strategy. In 2004, the Minister of Communications announced a new policy that would drive to reduce the disparity between urban and rural areas, to increase teledensity, and to grow the ICT sector in the economy, through a process of managed liberalisation, as provided for in the Telecommunications Act. The policy focuses on the need to reduce the cost of doing business in South Africa and poses the challenge of creating a globally competitive telecommunications sector. To meet the challenges, the Minister of Communications proposed a more competitive environment for the ICT sector, improved access to ICT infrastructure and services, and affordable telecommunications services (DOC, 2004). The proposals should provide a variety of choice on services offered by the ICT sector in order to meet those economic and social needs of society that contribute to stimulating development. Following a market study required by the Telecommunications Act (Act No. 103 of 1996), as amended in December 2001, the Minister of Communications made recommendations on further managed liberalisation of the ICT sector (DOC, 2004). A number of policy interventions were designed to accelerate growth in the sector, remove constraints to growth and reduce the cost of telecommunications, thus making provision for such managed liberalisation. These interventions came into effect on 1 February 2005 in the following areas: • Self provision and greater choice for mobile operators • Provision of public pay phones services to stimulate SMMEs • Provision of voice by value-added network service (VANS) to allow growth of VANS and promote SMMEs • Choice in provision of VANS • Cession of telecommunications services by VANS • Optimising the use of private telecommunications network facilities • Preparing the youth for the knowledge economy. 88 THE DBSA INFRASTRUCTURE BAROMETER The policy environment in the ICT sector is currently hotly debated. Policy and regulatory issues emerge with the convergence of services across traditionally distinct delivery platforms. The Convergence Bill, introduced to Parliament earlier this year, aims to create one legal framework for communications technologies that are currently covered by a range of different laws (indicated in Chapter 1). The Bill would give the Minister of Communications broader policy-making powers that would overlap with those of the Independent Communication Authority of South Africa (ICASA), and that would remove the requirement that the Minister consults with ICASA before making policy directions (Ensor, 2005b). Key policy directives relate to the importance of increasing access to, and the use of, broadband. This should contribute to higher rates of investment, which have been relatively slow in South Africa. Equally critical is the need to increase competitiveness of the economy by reducing the cost of telecommunications. The DOC is developing new policy directives in an attempt to achieve this. Other emerging policy issues relate to the ICT BEE charter and a code of good practice that will be drawn up and published (Ensor, 2005a). Institutional Structure A brief overview is given of the institutional dynamics in the ICT sector, explaining how the sector operates at government, state-owned enterprise and private levels. South African Government The DOC manages eight portfolio organisations. These are the South African Broadcasting Corporation (SABC), Independent Communication Authority of South Africa (ICASA), Sentech, South African Post Office Ltd, Telkom SA Ltd, the National Electronic Media Institute of South Africa (NEMISA), Universal Service Agency (USA) and Institute for Satellite and Software Applications (ISSA). The DOC carries two broadcasting responsibilities, SABC and Sentech. The focus of the SABC is to bring content and coverage in line with the needs of the population. Sentech was given a multimedia and international gateway licence to become the primary carrier in South Africa. The DOC also manages the postal service through the South African Post Office (SAPO). SAPO is responsible for the roll-out of communications infrastructure to rural areas using Multi-Purpose Community Centres (MPCC). SAPO is also rolling out Public Information Terminals (PIT), which are located at post offices and link the public to government information, e-mail facilities and internet browsing. The Minister of Communications announced the formation of a working group consisting of industry representatives, ICASA, consumers, business and government, to assist in the formulation of a national strategy for the conversion of broadcasting systems from analogue to digital (Ensor, 2005a). State-Owned Enterprises (SOE) (Parastatals) Transtel, the transport, shipping and rail SOE corporation, is a division of Transnet and, after Telkom, is the largest full-service private telecommunications network operator in the southern hemisphere. It is interconnected with the infrastructure provided by Telkom. Transtel operates the only other International Gateway for voice and data services in South Africa. It has developed a range of expertise that is now marketed throughout Africa. It is known for its skills in the installation of telecoms infrastructure, offering voice, data, wireless and satellite services. Eskom has more than 250 000 km of high-voltage lines which are starting to be strung with fibre optic cable for future telecom links. Eskom provided fibre-optic capacity for the second national operator (SNO). It maintains an autonomous telecommunications network that services the communications requirements of the whole of Eskom. Its backbone is currently based on microwave links, but it plans to run fibre optic cable down all new cables laid (Botha, 2004). These initiatives should gain further impetus when the Convergence Bill is enacted. Sentech provides all broadcasters with their terrestrial and satellite broadcasting facilities. Sentech has some 500 television transmitter towers as well as various FM, medium- and short-wave transmitters and satellite services. Sentech also provides a wireless internet access service. Satellite technologies are slowly opening up avenues for new licensed service providers to compete for broadcasting, data, and lastly, voice traffic (Botha, 2005). The placement and regional distribution of satellite earth stations and other infrastructure are given in Table 13. PART I CHAPTER 2 89 Table 13: Distribution of satellite infrastructure in South Africa Organisation Estimated percentage of stock in region Gauteng Western Cape KwaZulu-Natal Telkom 50 30 20 Transtel 65 25 10 Sentech 60 30 10 Multichoice (broadcast) 70 20 10 Other 70 20 10 Source: Botha, 2004 Arivia.kom is a leading South African IT solutions and services provider. It is the strategic intent of Arivia.kom to become the dominant ICT solutions provider in Africa, offering clients a national infrastructure, a diversity of services and critical systems. The Government Communication and Information Service (GCIS) is responsible for the roll-out of the Multipurpose Community Centres (MPCC) in the rural areas, with the goals of skills development and outsourcing of core technology requirements to the State Information Technology Agency (SITA). SITA is mandated to focus on and ensure that all Government IT “talks to each other” (inter-operable or compatible IT), operates in a secure environment (IT security), eliminates unnecessary IT duplications and is manageable. SITA is responsible for IT procurement and issues and processes all IT tenders. IT policy for the government is still the responsibility of the Department of Public Service and Administration. The SABC has radio and television networks. The television networks attract more than 18 million adult viewers each day, translating into 74 percent of all viewing adults. The national radio network comprises 18 radio stations, 13 of which are dedicated specifically to public service broadcasting. Of the estimated 29 million adults in South Africa, more than 22 million listen to the radio every day and more than 19 million tune in to an SABC radio station. The SA Post Office (SAPO) has grown its network to more than 2 500 outlets, offering millions of South Africans access to postal services. Of particular importance is the fact that more than 500 000 South Africans now receive their pension payouts through these outlets. Private Companies Telkom is an integrated communications operator that provides wire line and wireless services. Telkom has a 50 percent shareholding in Vodacom, the wireless service provider. Telkom had strategic equity partnerships with SBC (USA) and Telekom Malaysia, and part of that shareholding was recently sold to a BEE consortium. The South African Government holds a 39.3 percent shareholding. As of 31st March 2005 Telkom posted a group operating revenue of R43.1 billion, with total assets of R57.6 billion. It reported a profit of R6.7 billion attributable to equity shareholders. Telkom offers international connectivity from two international switching centres to terrestrial, satellite and submarine cable routes. The satellite earth station is situated at Hartebeeshoek, west of Tshwane. Further international connectivity has been provided with the deployment of very small aperture terminals and other satellite transmitters located at global and corporate customer premises throughout the country (Botha, 2005). A submarine cable system, SAT-3, provides links between Cape Town, Western Africa, Europe and the Far East. Telkom is the largest capacity owner on the SAT-3 submarine cable system with the right to use approximately 65 percent of the combined capacity. The MOC granted a licence to a Second National Operator (SNO) in December 2005. The establishment of a second operator, and thereby the introduction of competition to Telkom, is key to the effort to reduce telecommunications costs in South Africa. However, disputes have arisen within the preferred SNO consortium over ownership and control. Together with the delays in the licensing of competitors such as the Under-Serviced Area Licensees (USAL), this has not only allowed Telkom to continue to enjoy a de facto monopoly, but also the business case of any future competitor has become increasingly marginal. 90 THE DBSA INFRASTRUCTURE BAROMETER South African Internet Exchange (SAIX) is South Africa’s largest commercial Internet Access Provider. Fifty Internet Points of Presence (POP) have been established by SAIX throughout the country. The bandwidth belonging to SAIX is approximately 14.5Mbps with an upstream link to the USA. The Internet Service Providers (ISP) market in South Africa has been volatile, characterised by mergers and acquisitions. Some of the larger ISPs were connected to international companies that faced severe turmoil (e.g. Worldcom). The prominent first-tier ISPs include: Internet Solutions, UUNET, MWEB, MTN Network Solutions and Telkom Internet. The IS national backbone is depicted in Figure 18. Figure 18: Internet Solutions IS national backbone Source: http://www.is.co.za/files/national_backbone.pdf Computer Technology (Hardware, Software, Networks) Companies The hardware and component, software and networking suppliers are supported by several major distributors. Most of the hardware and software suppliers offer systems integration and consulting services, assisting their clients in selecting the right products for their business environments and customising systems to deliver the desired business solutions. The network providers do not sell cellular phone handsets themselves, but team up with mobile phone providers which are all multinationals operating in South Africa. Among these are: Nokia, Motorola, Samsung, Panasonic, Sony, Ericsson, LG, etc. The networks have subsidiaries or associates that offer cell phone contracts. The fast change in business that the ICT revolution has brought about is supported by a broad spectrum of consulting companies. International companies such as PricewaterhouseCoopers, KPMG, Deloitte and Accenture are active in the South African market, while numerous smaller consulting enterprises have sprung up to service clients. Mobile Network Providers There are three mobile network providers. Vodacom is a private company, owned equally by Telkom and Vodafone UK. Vodacom has 5 199 cellular base stations, covering 64 percent of the country’s land area. Vodacom currently enjoys a 54 percent share of the South African mobile network market. In 2003/04, Vodacom had 11.2 million subscribers (of whom 9.7 million are in the country), an annual turnover of R23.5 billion and a net profit of R3 billion. PART I CHAPTER 2 91 MTN, listed on the JSE Securities Exchange, provides cellular, satellite and internet access in South Africa as well as, through MTN Network Solutions to 14 African countries. It has 3 912 base stations, covering 19 200 km of roads. In 2003/04, it reported a revenue of R23.9 billion, had 9.5 million subscribers (of whom 6.3 million are in South Africa), and a net profit of R4.3 billion. The number of SMS messages for the past year was 5.4 billion. MTN currently enjoys a 36 percent share of the South African market. Cell C is 100 percent owned by 3C Telecommunications, which in turn is owned by Oger Telecom South Africa (60 percent), a division of Saudi Oger, and CellSAf (40 percent). It has more than 1 000 base stations. Cell C currently enjoys about 6 to 10 percent market share. Private Satellite or Terrestrial Television Broadcasters There are two private television broadcasters. MNet, the first subscriber TV channel, was extended to the Multichoice subscriber service. MultiChoice Africa has managed to grow a significant digital satellite television (DStv) market and has more than 1 million subscribers in South Africa and about 255 000 subscribers throughout Africa. New technology developments in the pay-television industry will give MultiChoice Africa subscribers unprecedented control over their viewing and enhanced experience. The convergence of broadcast media and telecommunications is at the heart of the advancements which are happening on a global scale. Industry Associations The ICT industry has arranged itself into several industry associations, such as the Electronic Industries Federation and the Computer Society of South Africa (CSSA). The Federation is the premier employer representative of business entities operating within the ICT sector of the South African economy. CSSA focuses its activities on community development, amongst other initiatives. The Information Technology Association is the official trade and employer body of the IT industry in South Africa. The Black Information Technology Forum was formed to address historical imbalances that have resulted in poor representation of blacks in the country’s ICT industry, both as professionals and as business operators, and were the force behind the development of a BEE charter for the ICT sector. Regulatory Environment Convergence Traditional telecommunications has been concerned with carriage issues of accessibility, interconnection and pricing. The cluster of ICT legislation passed over the last eight years will be pulled together by the Convergence Bill. When these conventionally distinct areas converge, questions arise around the extent to which universal access will be compounded with the introduction of initially high-cost devices and services (Gillwald and Esselaar, 2004). The high cost of the networks and their associated capital costs have resulted in greater consolidation of the global communications market. Interconnection of networks will become more important than ever as interconnectivity between different platforms will be central to seamless communications for consumers. It raises further questions around ensuring the viability of older forms of communication during the transition to this digital broadband era. Central to all of this is the creation of an enabling environment for innovative content and carriage options for a developing economy in a highly competitive international economy. ICASA has proposed that individual and class licences be granted in all licence categories, and is of the opinion that the South African telecommunications market needs a sector-specific regulator to deal with these issues (Ensor, 2005b). Many of the infrastructure issues in ICT are driven by the convergence of the two technologies (communication and IT) and by the fact that voice, data, image and sound are handled in a multi-media environment. The imminent convergence is displayed in Figure 19 in a simplified form. The ICT infrastructure is broken down logically into the branches for communication technology and information technology (Botha, 2005). 92 THE DBSA INFRASTRUCTURE BAROMETER Figure 19: The impact of convergence on the ICT sector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mCSF $BCMF $PQQFS *OGPSNBUJPO5FDIOPMPHZ /FUXPSLT 8JSFMFTT 4XJUDIFTBOESPVUFST *41)PTUT 0QFSBUJOHTZTUFNT "QQMJDBUJPOT 5IF*OUFSOFU 4PGUXBSF Source: Botha, 2005 Independent Communications Authority of South Africa (ICASA) The Independent Communications Authority of South Africa (ICASA) is responsible to the DOC for regulating the telecommunications and broadcasting sectors. Its mandate for telecommunications includes the numbering plan for telecommunication operators, the development of spectrum policy and frequency allocation, issuing fixed line and cellular licences, and VANS and PTNs regulations. Its projects for broadcasting include broadcasting sports rights, ownership and control policies, licensing of private sound broadcasters, terrestrial digital broadcasting and community television. For telecommunications, the ICASA mandate includes ownership and control policies and the realisation of the SNO. Regulating the South African telecommunications industry requires a sophisticated technological backbone. PART I CHAPTER 2 93 Financing Framework Financing of the ICT infrastructure is derived from a variety of sources, including government funding from National Treasury, private investment, foreign direct investment and development funding. The main funding comes from the private sector. Companies such as Telkom, MTN, Vodacom and Cell C are the major ICT service providers and fund their own capital expenditure in terms of new infrastructure, expansion of existing infrastructure and upgrades and replacements. The financial flow and dynamics are depicted in Figure 20. Figure 20: Institutions and their roles in ICT financing Source: BMI - TechKnowledge, 2005c The Private Sector The value of capital expenditure over time is difficult to obtain as the information is seen as proprietary and competitive. It is especially sensitive with the Second National Operator (SNO) becoming a reality. During the five-year exclusivity period (1997–2002), the total fixed-line capital investment by Telkom in network modernisation and line roll-out exceeded R27 billion. According to BMI-TechKnowledge (2004), the capital expenditure of the three mobile network service providers, MTN, Vodacom and Cell C, realised a cumulative R15 billion for the installed infrastructure base. The envisaged equity investment by Tata Africa Holdings in the SNO should also be quite substantial. The establishment of the SNO and the introduction of competition to Telkom is a key part of efforts to reduce telecommunications costs in South Africa. The bidding process having taken place, the preferred SNO is an entity that comprises a 15 percent shareholding each for Transtel and Eskom Enterprises, a 19 percent shareholding for empowerment partner, Nexus Connexion, and a 51 percent strategic equity shareholding held by Tata Africa Holdings (26 percent), CommuniTel (12.5 percent) and Two Consortium (12.5 percent). The Public Sector Development Finance Institutions The DBSA helped finance the upgrading of telecoms links between South African and Mozambique and became the executing agency for the African Connection project to help accelerate the development of telecommunication infrastructure. The DBSA also loaned R300 million to Cell C. The Industrial Development Corporation (IDC) supports ICT initiatives by providing finance to companies in electronics and electrical industries. Financing instruments include equity investment (minimum of R5 million) and commercial debt (minimum of R1 million). Finance is provided to techno-businesses as well as for black economic empowerment (BEE). 94 THE DBSA INFRASTRUCTURE BAROMETER The Government The DOC does not fund infrastructure directly and is only responsible for policy relating to the voice and data communications sector. The Department of Public Enterprises is the national government department that is responsible for policy on State-Owned Enterprises (SOE) such as Transnet and Eskom. Its role is to ensure policy certainty with the responsible policy departments and to ensure a sustainable financing strategy and a move to implement concessions, joint ventures and Public Private Partnerships (PPP) in various areas. Transtel and Eskom invested R2 billion in very high network availability and the latest data-switching in preparation for the SNO, while Eskom spent R850 million in fibre optic cable infrastructure which is to be made available to the SNO as part of its consortium membership. The Department of Science and Technology (DST) published the ICT roadmap for South Africa to set the landscape for research and development in ICT and to guide the private sector. DST funds support research and development in ICT through several programmes such as the Innovation Fund, university research via the National Research Foundation (NRF) and Centres of Excellence. Investment Outlook Most of the ICT infrastructural capital investment in South Africa originates from private companies such as Telkom, Vodacom, MTN and Cell C. BMI-TechKnowledge (2004) provided a medium to long-term outlook for capital expenditure in the telecommunications market by South African companies, including their projected investment elsewhere in Africa (Table 14). Table 14: Outlook for telecoms sector capital investment, 2003 - 2012 Capital investment (R billion) Operator Telkom 3-year outlook 2003 - 2005 10-year outlook 2003 – 2012 17 - 23 55 - 65 3-4 10 - 14 10 - 14 45 - 50 Cell C 3-4 6-8 Other 2-3 6-9 32 - 45 105 - 130 SNO Vodacom and MTN (including Africa) Total Source: BMI - TechKnowledge, 2004 It should be noted that the investment in other African countries constitutes just over half of projected Capex by MTN and Vodacom. PART I CHAPTER 2 95 Spotlight on Restructuring of Urban Rail Systems The Bangkok Skytrain, operated as a Public Private Partnership, has changed the face of public transport in Thailand’s capital city. Many cities are grappling with the challenge of enhancing the contribution which rail can make as part of an integrated urban public transport system. Lack of investment, unreliable service and inferior financial and operational performance have emerged as common characteristics of state-owned railways in many cities around the world (United Nations, 2003). Such railways have often emerged from a history where large state deficits were used to supplement relatively smaller fare box revenue contributions. As a result, railways have had little incentive to be costeffective or to respond flexibly to the needs of users. Recent economic reforms, introduced in both developed and developing countries, have favoured restructuring the relationship between the railway operators and the state. This often means that the railways remain 100 percent state-owned, but within a clearer regulatory framework and the involvement of the private sector. Usually, this involvement is operational but may also include responsibility for infrastructure. Although there has been mixed success with respect to some of these initiatives, the private sector often brings improved operational efficiency and aligns the product mix more closely to the needs of users. It can also be used as a vehicle to invest in infrastructure and operational assets. In urban environments, indirect forms of competition are favoured. This usually implies competition “for the market” where a company retains the right to service a single route, a collection of routes or the whole network (including the operation of other modes) for a limited period of time on the basis of a pre-defined performance agreement. The selection of which private operator may provide services is based on a bidding 96 THE DBSA INFRASTRUCTURE BAROMETER process in which operators compete for the “right to operate”. The performance agreement may specify operational responsibility for the train services. It may additionally specify responsibility for the underlying infrastructure, such as track, signals, etc. The agreement may also allow varying degrees of innovation and almost always includes certain basic pre-conditions such as minimum service levels, on-time performance requirements, etc. Typically, concessions at urban level favour integrating infrastructure and operations, rather than separating them. The commuter lines leading into Buenos Aires (Argentina) were concessioned in 1994 when the monopoly control of the state-owned Ferrocarriles Argentinos was separated into seven vertically-integrated concessions. Each concessionaire received full responsibility for commercialisation, maintenance, rolling stock and infrastructure for ten years. A railway restructuring unit was set up by government to manage the regulatory reform and bidding process. It specified maximum fares and minimum service levels and provided concessionaires with a range of performance incentives (Kopicki and Thompson, 2000). In the period up to 2000, there was an approximately 80 percent increase in passenger kilometres across these seven concessions (some increased far more than others), a slight reduction in staffing levels and an increase in rail fares (World Bank, 2001). Many other Metro services, such as Bangkok’s rail transit system, the Skytrain, are operated by the private sector. In Bangkok’s case, a 30-year concession was granted to a private sector company known as Bangkok Transit System Corporation (BTSC). All infrastructure and rolling stock are privately financed and BTSC receives no operating subsidy. Construction was initiated in 1997 and the Skytrain began operating in 1999. In a city plagued by some of the worst congestion in the world, this mass transit initiative has had an extremely positive impact (International Railway Journal, 2000). In Africa, the introduction of a private sector operator in Cameroon in 1996 has had mixed success. The railway is both a passenger and freight railway and while the operator has shown commitment to passenger services, it would like to eliminate the all-stations-stop services which are unprofitable but important for local access. Delays in agreed investments have also characterised the concession. Both these problems point to the need for clear up-front contractual conditions that would protect certain unprofitable services, and for stronger government regulatory oversight to ensure that concession agreements are met (Murdoch, 2005). The Gautrain, linking Johannesburg International Airport, Johannesburg and Tshwane, will be constructed and operated by what will be the first Public Private Partnership (PPP) project in urban passenger rail in South Africa. On 2 July 2005, Gauteng Province announced the successful bidder for the finance, construction and operation of Gautrain (www.gautrain.co.za). It is clear that potential benefits would be significant and provide a pilot case for integrated public transport in other parts of South Africa (Shaw, 2005). However, the project has been critisised for costs which have escalated from an initial public sector estimate of R7 billion to a post - bidding phase estimate of R12 billion (both measured in 2002 rands for comparative purposes). National and provincial governments have agreed to jointly cover a large component of the construction costs. As the successful consortium, Bombela, will provide the balance of funding and will build and then operate the system for a 20-year period. During this time, the consortium will depend on revenue earned through ticket sales as a performance incentive to maximise ridership (Venter, 2005). SPOTLIGHT ON RESTRUCTURING OF URBAN RAIL SYSTEMS 97 CHAPTER 3 State of Infrastructure Chapter 3 presents the location and condition of the four infrastructure sectors. Transport, energy, water and sanitation, and ICT infrastructure are depicted visually using maps and figures. The condition of these investments is evaluated. Introduction Chapter 1 provided a comprehensive overview of the history and sometimes chequered development of four of South Africa’s key economic infrastructure sectors. This historic overview was further enriched (Chapter 2) with information about the current operating environment influencing and governing the four sectors. However, of greatest importance are the physical location and condition of this infrastructure. How many kilometres of road does South Africa have? What is the condition of these roads? What is the generating capacity of Eskom? In what kind of shape are the power stations? These are a few of the pertinent and interesting questions answered in this chapter. As in the previous chapters, transport, energy, water and sanitation, and ICT are unpacked and presented in a user-friendly manner, illustrated with maps showing the physical location of infrastructure investment. Where available, the state or condition of this national-level infrastructure is presented, bearing in mind that such information dates very fast. Transport Introduction Transport infrastructure is crucial to the well-being of any nation. Unfortunately, the condition of transport infrastructure in South Africa has on the whole been permitted to decline. This is particularly true in respect of provincial roads and infrastructure in the rail and ports sectors. Some improvements have been evident in respect to national roads and larger commercial airports. On a more positive note, however, budgets for new capital works and for infrastructure rehabilitation have increased in the last few years. This includes Transnet (rail, port and pipeline infrastructure), SANRAL and many of the provinces. Road, Rail, Port and Pipeline Infrastructure Roads of National Importance Transport infrastructure, particularly roads, are pervasive across the entire country and the large majority of roads lie in the rural access category, where little is known of condition and extent can only be estimated, as shown in Chapters 2 and 5. Figure 21 shows South Africa’s core network of both primary and strategic secondary roads. Less than half of these roads, but generally those roads that constitute the most highly trafficked and commercially significant part of the network, are currently under the direct management control of the South African National Roads Agency Ltd (SANRAL). The commercially most significant part of the network includes the N3 from Gauteng to Durban, the N1 from Gauteng to Cape Town, the N1 from Gauteng to Beitbridge and the N4 from Lobatse in Botswana, via Gauteng, to the Lebombo Border Post with Mozambique. PART I CHAPTER 3 99 Figure 21: Road infrastructure in South Africa Source: SANRAL, 2005 It is envisaged that SANRAL will take ownership, or at least management control, of a much larger portion of the primary and strategic secondary road network. This would involve a process of expanding the 6 700 km of roads (shown in blue and red) to include the 13 000 km of roads (shown in purple), resulting in a total primary road network under its control of approximately 20 000 km. There are sound reasons for this proposal, including SANRAL’s objective of sustaining a comprehensive primary road network that links major economic and social centres at both national and international level. This network is characterised by longer travel distances and higher speeds, with minimum interference to free flow of traffic. Enhanced mobility on this network would primarily be for economic reasons and would focus on supporting and sustaining economic growth (SANRAL, 2002). This process has resulted in the incremental incorporation of selected provincial roads into the primary road network. Each of the dominant economic corridors in South Africa is served, in general, by parallel and competing road and rail infrastructures. The potential for effective inter-modal competition, through effective market-driven policies, especially in respect to freight traffic and mutual support between modes, could assist in enhancing the integration and efficiency of both road and rail networks. Indications are that the national road network and the road network of Gauteng Province remain in a stable condition. However, the condition of the remainder of the provincial road network continues generally to decline. Figure 22 shows the visual classification index of all primary trunk routes in South Africa. The decline in the condition of infrastructure is partly a result of the severe funding constraints experienced by the provinces but is also a characteristic of the age of the network and implies the need for greater levels of maintenance and rehabilitation than in the past. The decline in road quality over the period shown (1988 to 1999) has been 100 THE DBSA INFRASTRUCTURE BAROMETER Figure 22: The visual classification of South African route conditions Source: Sampson, 2002 acknowledged by National Treasury and the respective provinces and levels of funding have increased for almost all provinces. Whilst this increased level of funding has been insufficient to reverse the decline in road quality there is some evidence to suggest that the condition of roads in certain provinces is beginning to stabilise. Figure 23 demonstrates the relative change in provincial fund allocations for roads for the period from 2001 to 2005. KwaZulu–Natal was by 1999 characterised as having the lowest quality road infrastructure as measured by the visual classification index. In subsequent years (2001 to 2005) it has been successful in increasing nominal levels of fund allocation to roads by more than 50 percent. Other provinces, such as the Free State also demonstrate lower than average road quality. Yet the Free State has shown no overall increase in expenditure on roads over the five year period from 2001 to 2005 and in real terms road expenditure for this province has declined. For most provinces the shifts in nominal fund allocation to provincial roads reflect levels of growth that are above inflation. Sustaining and improving the condition of provincial roads remains a challenge even though funding levels have improved. Increases in traffic volumes, increased heavy vehicle usage, aging network condition and climatic conditions in the western part of the country all continue to adversely affect the quality of the network. A comprehensive approach to assessing the overall condition of roads within the country may provide a mechanism to assist in better prioritising funding. More effective road management systems within provinces would also offer the opportunity to prioritise spending more effectively. This would promote sustained cycles of preventative maintenance which have, until now, been largely absent in many provinces. Part of SANRAL’s success in sustaining the national road network is a result of the commercialisation of large components of the primary road network, particularly that part which is highly trafficked (Figure 21, indicated in red). SANRAL also receives national budget allocations from Treasury through the Department of Transport (DOT) for expenditure on national roads. Although less than the funding requirements that SANRAL has identified as the minimum necessary, these fiscal allocations are used to maximise the service condition provided by the network. This is achieved through maintenance and rehabilitation allocations to individual roads based on SANRAL’s comprehensive roads management system. Provinces generally have weaker management systems, with some provinces allocating funds for PART I CHAPTER 3 101 maintenance and rehabilitation, despite having little information on likely future network condition. Toll roads (as illustrated in Figure 21) fall into two categories, state-owned and concessioned (Build Operate Transfer (BOT)) toll roads. State-owned toll roads are those funded directly by the State but managed by the private sector. These are funded by loans raised directly by SANRAL through bond issues from capital markets. For these parts of the network, toll operators bid to operate the toll road, including collecting tolls on behalf of SANRAL and maintaining the quality of the asset. Figure 23: Annual Provincial Road Expenditure for South African Provinces, 2001 to 2005 -JNQPQP ,;/ .QVNBMBOHB 'SFF4UBUF 8FTUFSO$BQF &BTUFSO$BQF /PSUI8FTU /PSUIFSO$BQF (BVUFOH 1SPWJODF Source: Mohale, 2005 Concession, or BOT, toll roads are provided through a concession for the initial construction cost, the continued maintenance cost and the operational cost of providing toll services. The concessionaire takes risk on these elements, as well as the toll revenue generated, and holds the asset for a set period of time, usually 30 years, before transferring it back to the State (SANRAL, 2004). It is important to realise that there is a limit to which roads may be financed through tolling. Physical restrictions on some parts of the network make tolling difficult. In urban areas, such restrictions coupled with unwanted external impacts on other parts of congested urban networks, make such solutions difficult to implement. In other areas, where traffic volumes are low, the financial case for toll roads becomes more difficult. It is generally accepted that, for the South African model, volumes of less than 4 000 vehicles per day cannot be commercially warranted for toll road development. As a consequence, the majority of the strategic road network (Figure 21) will remain funded through direct government budgetary processes unless other forms of user-pay approaches can be developed. Urban and Rural Roads Municipal urban and unproclaimed rural roads constitute a little more than half of the total road length of South Africa (Chapter 1). These roads provide social accessibility and meet the mobility needs of the population. The condition of the urban roads system is described in the needs of urban infrastructure (Chapter 5). The condition of the urban road network parallels that of the rural network, but with the added demand of having to meet the needs of fairly rapid urbanisation. The challenge in rural areas is to sustain an effective access road network, with the secondary rural road network largely in place. Much emphasis has been given to this since 1994, but considerable challenges remain in improving, in particular, access in remote rural locations. In urban areas, the challenge is somewhat different, with new capacity needing to be provided to meet both spatial needs of expansion and economic growth within cities. An added complication has been the re-demarcation of local government boundaries in 2000. Whilst these are welcomed as entirely appropriate for addressing the overall needs of all citizens of the nation, it 102 THE DBSA INFRASTRUCTURE BAROMETER does mean that there is a need for roads, which were historically the responsibility of provinces, to be taken over by municipal government. This is a process which will take some time to see through and it is probable that some roads will deteriorate substantially before being fully absorbed by municipal government. Weather also has a significant influence on road condition, with roads in the more arid parts of South Africa performing generally better than those in the wetter regions. This is particularly true of gravel roads in hilly or mountainous terrain, roads which are more often than not in rural areas and under the control of provincial government. From a purely financial perspective, the estimated cost of bringing the rural system to “adequate” levels is R38 billion, in addition to normal current allocations (National Department of Transport, 2002). The additional amount required for the municipal network is estimated at R6 billion (derived from the analysis provided in Chapter 5). Institutional requirements to meet the need for ongoing management, investment and operational expenditure of both the rural and municipal networks are described in the South African Strategic Investment for Roads (National Department of Transport, 2002) produced by the DOT in cooperation with other national departments and provincial and local road implementing institutions. This document indicates that only about half the skilled resources required to address the issues involved are available, and it could take a decade to develop the human resources necessary to address all the needs. Rail and Ports Figure 24 illustrates the extent of the rail network and the location of South Africa’s six largest ports. Figure 24: Rail and port network of South Africa Source: Adapted from Barnard, 2003 & National Ports Authority, 2004 The South African rail network comprises 20 451 km of track. Of this, 9 800 kilometres of track may be regarded as the core network, while 4 400 km are more lightly used and 5 500 km may be regarded as the low density part of the network (Stander, 2004). PART I CHAPTER 3 103 The primary (or core) rail network (Figure 24, indicated in green) is operated by Spoornet’s General Freight Business (GFB) division. This part of the network has a traffic density in excess of 5 mgt (million gross tonnes) per line per annum. Cross-border rail links by the primary rail network are at Komatipoort (into Mozambique), Beitbridge (into Zimbabwe) and Golela and Mhlume (into Swaziland). GFB freight is concentrated in the following sectors: steel, mining, building construction, coal, timber, grain, fuel, fertilisers, chemicals, containers and automotive (order of importance by volume). The Orex and Coalink export lines are indicated in red in Figure 24. Orex serves the Sishen iron ore mine in the Northern Cape and transports iron ore to the port of Saldanha. The Coalink network serves the coal fields of Mpumulanga and transports coal to the port of Richards Bay. The non-core network, also the responsibility of GFB, has a traffi c density of less than 5 mgt per line per annum and many parts of this network have a traffic density of less than 0.2 mgt per line per annum. These components of the network are often referred to as branch lines and continue to link the network with smaller rural settlements. As freight has shifted from rail to road, the dependence of many of these rural settlements on rail has tended to diminish and Spoornet tends to operate less frequently along these lines than in the past. In addition to branch lines, there are also a number of redundant lines, some of which are closed and others where the track has been removed. These were either provided in the heyday of rail when they served a particular need that is no longer required, or were provided for political rather than economic reasons. An important element of the map is the reliance of mining on an effective rail service, with many lines that are part of the core rail network having a strong mining focus. Examples of this are the lines to Hotazel (mangenese, iron ore), Vryheid (coal), Phalaborwa (phosphate, copper, ferro-alloys) and Grootgeluk and Ellisras (coal). A very small (almost inconsequential) part of the network has been concessioned or leased, often for tourist services. Of the ports, only Durban, Cape Town, Richards Bay, Saldanha and Port Elizabeth are connected to the core rail network. Ports such as East London and Mossel Bay, which are much smaller, are considered to lie outside the core network. This recognises the fact that the line from De Aar to East London port is fully electrified and is currently under-capacity. Table 15 indicates the tonnages moved by GFB, Orex and Coalink and shows financial performance of these three operating units. It should be noted that recent changes within Spoornet have combined these three operating divisions and Spoornet is starting the process of vertical separation into an infrastructure-related component and an operations component. Table 15: Business performance of Spoornet’s three operating divisions, 2001/02 Business division Spoornet: General Freight Business (GFB) General freight movements, Business characteristics mostly concentrated on core network Volume (million tonnes) Revenue (income) (R million) Operating expenditure (R million) Operating profit (loss) (R million) Operating ratio (%) Coalink Orex Bulk coal exports through Bulk iron ore exports through Richards Bay Saldanha 85.38 64.8 25.8 7 607 2 489 892 8 076 988 375 (469) 1 501 517 106.2 39.7 42 Source: Spoornet, 2002 Figure 25 demonstrates the extent of capital expenditure by Transnet over the period 1989 to 2004. Capital expenditure has averaged 15 percent of turnover over this period, but this has clearly been insufficient to sustain the productive use of assets. 104 THE DBSA INFRASTRUCTURE BAROMETER Figure 25: Capital expenditure as a proportion of turnover for Transnet Source: Transnet, 2004 In the most recent financial year, Transnet has shown a significant loss, which has placed serious constraints on the company’s ability to re-invest (Transnet, 2004): “As a result of [Transnet’s] cash flow and gearing constraints, a number of key divisions have been starved of the capital needed to maintain, modernise and grow operations. Transnet has consequently built up a capital expenditure backlog and now faces requirements approaching R35 billion over the next five years. This undermines our service competence and competitiveness, and therefore our earnings and cash-generating potential.” This is a significant constraint and is partly addressed by a rosier financial outlook and greater potential for investment in the 2004/05 financial year. Given the enormity of its investment requirement and other performance-related challenges, Transnet’s sustainability still has the ability to reduce South Africa’s potential for growth. The more drastic approaches, such as partial or complete privatisation that have been applied to port and rail ownership and operations in other countries, do not seem to be under consideration at this stage. The condition of Transnet’s rail and ports assets are indicated in Chapter 2. Locomotives are on average 25 years old (9 years older than international best practice) (Stander, 2004), and ports such as Durban are close to capacity limits for many commodities. The lack of investment, particularly in rail rolling stock and fixed infrastructure (e.g. track and signals), is inhibiting the effective utilisation of available rail capacity and is also a significant barrier to improvements in rail service reliability. Management and overstaffing remain additional constraints to improvements in productivity. Table 16 gives the characteristics of South Africa’s seven main ports. Durban is the clear leader in container and general freight (sometimes referred to as break-bulk) whilst Richards Bay and Saldanha are the bulk terminals for coal and iron ore exports respectively. Cape Town retains a strong focus on fruit export. Port Elizabeth and East London, while much smaller, tend to focus on general cargo and vehicle-related imports and exports. The draught limitations of each port indicate the restrictions for access by larger vessels and the ability of Richards Bay and Saldanha to accommodate much larger deeper-draught vessels. PART I CHAPTER 3 105 Table 16: South African port characteristics Port Entrance channel draught (m) Specialist facilities and terminals catering for: Container capacity TEUs/ annum (TEU = Twentyfoot Equivalent Unit as a measure of a dry cargo container) Durban 12.8 Container dry bulk, liquid bulk, cars, sugar, fresh produce, multipurpose general cargo & variety of specialist private terminals 1 100 000 Cape Town Richards Bay 15.9 Container, dry bulk, fruit multi-purpose general cargo Saldanha 14-19 (harbour draught) 20.5 (harbour draught) Coal, dry bulk, multi-purpose general cargo Iron ore, oil, multi-purpose general cargo Port Elizabeth East London 13 Container, multi-purpose general cargo 400 000 320 000 Mossel Bay 10.4 (harbour draught) Grain, cars, container multi-purpose general freight 8 Petroleum 90 000 5 main exports (Volume in tonnes/ annum) (2002/03) Steel (2.04) Petroleum & gas (1.94) Coal (1.92) Chemicals (0.84) Sugar (0.75) Deciduous fruit (0.68) Petroleum & gas (0.62) Beverages (0.36) Citrus fruit, (0.29) Cement & clinker (0.25) Coal (68.55) Woodchips (2.94) Ferro alloys (1.31) Chrome ore (0.71) Titanium slag (0.55) Iron ore (24.97) Steel (1.03) Titanium slag (0.19) Zircon (0.09) Pig iron (0.08) Manganese ore (1.66) Citrus fruit (0.13) Beverages (0.12) Appliances & spares (0.08) Vehicle components (0.07) Vehicles, aircraft & boats (0.24) Ro Ro vehicles (0.11) Vehicle components (0.05) Maize (0.03) Steel (0.01) Petroleum & gas (0.02) 5 main imports (Volume in tonnes/ annum) (2002/03) Petroleum & gas (15.22) Maize (0.93) Wheat (0.89) Chemicals (0.87) Fertilizers (0.74) Maize (0.35) Barley (0.19) Agricultural products (0.2) Fertilizer (0.2) Household products (0.13) Coal (1.36) Alumina (1.18) Sulphur (0.6) Rock phosphate (0.36) Chemicals (0.28) Petroleum & gas (3.69) Steel (0.51) Coal (0.11) Iron ore (0.073) Copper (0.009) Appliances & spares (0.29) Vehicles, aircraft & boats (0.26) Vehicle components (0.21) Rubber products (0.11) Paper (0.08) Vehicle components (0.43) Maize (0.21) Vehicles, air craft & boats (0.09) Wheat (0.04) Sugar (0.01) Petroleum & gas (0.04) Source: Maritime Handbook: Southern Africa, 2004 The two deepwater ports are soon to be joined by the Port of Ngqura which is under construction and is expected to have a draught limitation of 15 metres (National Ports Handbook: Southern Africa, 2004). Current capital investments by the National Ports Authority are at this stage largely focussed on completion of the Port of Ngqura and expansion of the handling capacity of the Port of Durban. In the latter case, this includes expansion of the harbour entrance, increasing the berthing and handling capacity requirements of general freight, and, through South African Port Operations, SAPO, improving investments in crane handling capacity. Three new-generation gantry cranes are now operational and will be used to enhance the throughput of containers at the port. Urban Rail The previous section has focussed on rail infrastructure in general and has naturally implied a strong focus on freight transport which remains by far the dominant use of rail in South Africa. The country has a well-developed network of urban passenger trains. This is operated by Metrorail, a division of Transnet, under the auspices of the South African Rail Commuter Corporation (SARCC), a wholly-owned subsidiary of Government, reporting to the Minister of Transport. SARCC owns all commuter rail assets, including the large majority of track and related fixed infrastructure used for commuter rail services. A cabinet memorandum was formulated in 2002 proposing the merger of all passenger rail services, including long-distance services (Shosholoza Meyl), SARCC and Metrorail, into a single institutional entity (SARCC, 2003). Competition from road and particularly from the minibus “taxi” industry has led to a decline in commuter rail ridership, and a concomitant decline in investment into urban rail systems. The average age of Metrorail train sets is 30 years, and while little is known about the condition of track and signalling equipment, it is widely regarded as now beyond its economic life. There are a number of urban rail high-demand corridors where rail may enhance its role as a high frequency people mover. There are also many low-demand corridors which are sustained with few commuter rail services and very low patronage. The core high-demand corridors are starved of necessary investment and are losing market share. These corridors should be given investment priority, while the role of rail in other parts of the lower-demand commuter network should be re-assessed. 106 THE DBSA INFRASTRUCTURE BAROMETER Airports Figure 26 illustrates the location and physical characteristics of the 23 main airports in South Africa. Of these airports, the largest are under the control of the Airports Company of Southern Africa (ACSA). The numbers of aircraft landings, passenger departures and staffing at each of the ACSA airports are given in Table 17. Johannesburg International Airport stands out in terms of not only the overall number of flights but also the relative extent of international flights as a proportion of total flights. Figure 26: Location and physical characteristics of South Africa’s 23 main airports Table 17: ACSA airport statistics for the year ending March 2004 ACSA Airport Aircraft landings Departing passengers (‘000s) Staff (excluding head office) Johannesburg International (JIA) Cape Town International (CIA) Durban International (DIA) 89 112 6 637 860 46 222 2 748 329 22 418 1 440 213 Port Elizabeth (PE) 16 950 488 81 6 226 201 46 George (GG) 11 085 199 49 Bloemfontein (BFN) 10 804 109 55 Kimberley (KIM) 4 600 46 33 Upington (UP) Pilanesberg International (PIA) 2 489 16 10 3 029 15 17 East London (EL) Source : ACSA, 2005 The larger but non-ACSA airports are those which have air navigation services provided by Air Traffic Navigation Services (ATNS). Other airports (e.g. Skukuza and Phalaborwa) operate scheduled services but do not have ATNS services and are not shown on the map (Figure 25). Pipelines South Africa’s fuel transporting pipelines were introduced in the 1960s to augment rail carrying capacity in PART I CHAPTER 3 107 transferring crude oil-based products from the coast to inland processing plants (initially Sasolburg, later augmented with Secunda). Current national pipeline infrastructure is discussed in the Energy section of this chapter. As a division of Transnet, Petronet operates this infrastructure. It plans to nearly double existing pipeline capacity between Gauteng and Durban by 2010. This would be based on the construction of a new 400 mm pipeline which would increase capacity to 6.24 billion litres per annum (Salgado, 2005). More recent additions to the pipeline network have been made with greater private sector involvement (e.g. the Pande to Secunda gas pipeline that is being funded and operated by SASOL). Pipelines present themselves as ideal candidates for public private partnerships (PPP). They are simple to ring-fence and are relatively easily regulated. Transnet and Petronet should consider this as a mechanism for enhancing such infrastructure. Conclusion This section has provided a review of the major national economic infrastructure with respect to transport. It has not focused on transport-related infrastructure in metropolitan areas, smaller cities and provinces. An important characteristic of this infrastructure is that most of it is concentrated in areas of high economic potential and not in deep rural areas. A further important perspective is the central and dominant role played by Gauteng as the economic hub of the country. A great deal of the infrastructure focuses on linking this hub with the major ports and the major corridors into the SADC region, indicating the strategic importance of most national transport infrastructure. Data with respect to the condition of infrastructure is poor. There would, however, seem to be a downward trend in the overall condition of infrastructure with respect to roads, rail, ports and even selected smaller airports. This would seem to be recognised by the various institutions involved in funding and providing infrastructure, including National Treasury. The result is that some steps are in place to address the condition of infrastructure, including that within the dominant parastatal, Transnet. One particular remaining challenge is ensuring that efficiency gains in the operation of infrastructure are sufficient to warrant its upgrade. This is particularly true of rail and ports. In the case of roads, strategic planning emphasising selective upgrading and rehabilitation to sustain long-term network condition, should become the focus. This approach will require a sustained longer-term increase in funding. Energy Introduction This section of Chapter 3 discusses the status of existing infrastructure in the energy sector - electricity, liquid fuels, gas and renewable energy. The owners of this infrastructure include Eskom and other parastatals, municipalities and the private sector. The location and extent of the infrastructure are described, as are its age and condition, as far as is known. Electricity Generation The installed and operational licensed electricity generating capacity is indicated in Tables 18, 19 and 20 for Eskom, Municipal and private generation respectively. Most of this information has been obtained from the NER’s publication, Electricity Supply Statistics for SA, 2002 (National Electricity Regulator, 2002a). The following background information is important: • The three mothballed Eskom power stations have a combined capacity of 3 541 MW and are currently de - mothballed (Table 18). • Eskom divides its plant into the three categories of base, mid-merit and peak load. Large efficient plants are used for base load (those with high load factors). Older, more expensive and less efficient plants are used for mid-merit applications. Specialised or expensive-to-operate plants are used for peak loads (e.g. gas turbines, pumped storage) where the load factors are low. • The Majuba power station is not yet fully operational as the Majuba colliery was permanently closed in 1993. This was due to unforeseen geological problems and the consequent high cost of the mined coal (Eskom, 2002). Press reports have indicated Eskom’s plans to construct a dedicated railway line to a suitable coal mine. • The gas-fired power stations (Table 18) consist of aircraft turbine engines that operate on aviation kerosene. 108 THE DBSA INFRASTRUCTURE BAROMETER These plants are expensive to operate and have been installed for emergency use and peak power requirements. This also applies to similar plants in Table 19. • The gas turbine stations (Table 18), have been derated to 54 and 15 MW on technical grounds, but have not been used since 2002, hence the zero load factor. • Note in Table 18 that the total of the “Max. power produced” for Eskom is higher than the “Licensed capacity”. This is indicative of good operation and maintenance and the upgrading and improvement of plant to improve the initial ratings. The converse applies to Municipal plant in Table 19 where substantial derating of the installed (licensed) capacity has taken place. • Pumped storage cannot really be described as power stations as they consume more energy than they produce. Conventional power stations are used to pump water to high-level reservoirs during off-peak periods. During peak demand periods, the pumped storage stations then use this water to generate electricity. In effect, they utilise surplus capacity in off-peak periods to satisfy peak demands, and therefore increase the peak demand capacity. • The data on the commissioning dates of the Eskom power stations has been obtained from an Eskom Statistical Bulletin (Eskom, 1997). • The year 1982 at the bottom of the last column in Table 18 is the average commissioning date of all of Eskom’s power stations. Table 18: Licensed Eskom power stations, 2002 Station Type Location Licensed capacity (MW) Max power produced (MW) Load factor (%) Net electricity sent out (GWh) Year last unit commissioned Arnot Coal Middelburg 1 980 2 100 11 974 61.1 1975 Camden Coal Ermelo 1 520 Mothballed n/a n/a 1969 Duhva Coal Witbank 3 450 3 600 23 320 73.9 1984 Grootvlei Coal Balfour 1 130 Mothballed n/a n/a 1977 Hendrina Coal Hendrina 1 895 2 000 12 752 72.9 1977 Kendal Coal Witbank 3 840 4 116 26 006 72.1 1993 Komati Coal Bethal 891 Mothballed n/a n/a 1966 Kriel Coal Bethal 2 850 3 000 19 165 72.9 1979 Lethabo Coal Sasolburg 3 558 3 798 22 019 66.2 1990 Majuba Coal Volksrust 3 843 4 110 4 600 12.8 2001 Matimba Coal Ellisras 3 690 3 990 25 145 71.9 1991 Matla Coal Bethal 3 450 3 600 25 577 81.1 1983 Tutuka Coal Standerton 3 510 3 645 11 185 35 1990 Acacia Gas turbine Cape Town 171 54 0 0 1976 Port Rex Gas turbine East London 171 15 0 0 1976 Gariep Hydro Norvalspont 360 365 1 164 36.4 1976 Vanderkloof Hydro Petrusville 240 244 1 192 55.8 1977 Colleywobbles Hydro Mbashe 42 n/d First Falls Hydro Umtata 6 1982 Second Falls Hydro Umtata 11 1982 Ncora Hydro 2 n/d Koeberg Nuclear West of Cape Town Drakensberg Pumped storage Bergville Pumped storage Grabouw Palmiet Total Eskom in operation 1 800 1 930 11 961 70.8 1985 1 000 1 178 -581 11 1982 400 486 -159 14.1 1988 36 269 38 231 195 320 59.1 1982 PART I CHAPTER 3 109 Most municipal plants (Table 19) are old, have been derated (918 MW max power versus an installed capacity of 1 203 MW) and, in many cases, are used for emergency and peak load applications, as is indicated by the low average load factor of 18.6 percent. The total maximum power produced (column 5) of these plants is low compared with those of Eskom (2.4 percent of the Eskom total), and is also less than private sector generation (Table 20). Other than the Kelvin Power Station (Table 20) that was sold by the Johannesburg Municipality to an independent power producer (IPP) in the 1990s, all the private power stations produce electricity for use by individual manufacturing concerns. The operating regime is mostly in combination with an Eskom supply, with the objective of minimisation of own power expenditure. When the surplus Eskom capacity has been absorbed by load growth, a power-purchasing tariff can be expected that may make it economically feasible to sell surplus power to Eskom. Table19: Licensed Municipal power stations, 2002 Station Athlone Type Coal Location Cape Town Licensed capacity (MW) Max power produced (MW) Net electricity sent out (GWh) 180 121 30 Not in operation 240 Not in operation 103 62 300 Not in operation Load factor (%) 76.6 7.3 8 233 1.5 50.2 Kroonstad Coal Kroonstad Swartkops Coal Port Elizabeth Bloemfontein Coal Bloemfontein Orlando Coal Orlando Rooiwal Coal North of Pretoria 300 216 949 Pretoria West Coal Pretoria West 170 136 167 14 Roggebaai Gas turbine Cape Town 50 66 3 0.5 Athlone Gas turbine Cape Town 40 38 1 0.3 40 Not in operation 4 0.5 34.2 Port Elizabeth Gas turbine Port Elizabeth Orlando Gas turbine Orlando 176 102 Pretoria West Gas turbine Pretoria West 24 Not in operation Lydenburg Hydro Lydenburg 2 2 6 Ceres Hydro Ceres 1 0 1 61.7 Piet Retief Hydro Piet Retief 1 1 4 50.7 Steenbras Pumped storage North of Cape Town 180 174 -75 18 1 203 918 9 369 18.6 Licensed capacity (MW) Max power produced (MW) Net electricity sent out (GWh) Load factor (%) 12 9 27 34 35.4 Total in operation Table 20: Licensed private power stations, 2002 Station Tongaat Hulett Bagasse/coal Location Amatikulu Tongaat Hulett Bagasse/coal Darnall 12 7 22 Tongaat Hulett Bagasse/coal Felixton 32 24 67 31.6 Tongaat Hulett Bagasse/coal Maidstone Mill 29 20 67 38.5 Transvaal Suiker Bagasse/coal Malelane 20 19 77 46.2 Kelvin Coal Isando 540 470 1 721 41.8 Sasol Synthetic Fuels Coal Secunda 600 628 4 421 80.4 Sasol Chem Industries Coal Sasolburg 139 117 808 78.8 Friedenheim Hydro Total 110 Type 3 2 15 85.7 1 387 1 296 7 225 63.6 THE DBSA INFRASTRUCTURE BAROMETER The state of power stations is influenced by local conditions, the initial design, construction and materials of the plant, age (wear and tear) and the quality of the operating and maintenance regime. The economic life of power stations is generally taken as 30 to 50 years, depending on the above variables. No hard information is to hand, but it is known that Eskom benchmarks its activities against other leading utilities. Energy availability of 92 percent of generation plants against a benchmark of 90 percent was reported in 2001. In addition, an average of 1.5 unplanned automatic grid separations occurred in comparison with a target of 1.7 (Eskom, 2002). The average age of Eskom’s power stations is a little more than 20 years, which means that replacement will become necessary from about 2020 onwards. This situation is indicated in Figure 27 in which the horizontal scale extends from 1955 to 2060. The withdrawal of existing power stations over the 2020 to 2050 period is also indicated in the Department of Minerals and Energy’s Integrated Energy Plan (DME, 2003). The inclined blue line is the expected peak demand on the system. In addition to new power station investment to supply the growth in electricity demand, Figure 26 indicates that a massive investment programme will need to commence by about 2015 in order to replace existing power stations that will have reached the end of their economic life. Generating companies will need to take steps to ensure that the economic life of their power stations and equipment is as long as possible, for example, by applying the best maintenance programmes and the replacement and upgrading of plant and materials where this is economically feasible. Figure 27: Eskom’s current generating capacity Note: The inclined blue line is the expected peak demand on the system. Transmission Eskom owns the national electricity transmission system and is responsible for its operation and maintenance. Figure 28 illustrates the major transmission lines (International Energy Agency, 1996). Table 21 indicates the components of the national transmission system, where transmission is defined as that part of the network that operates at a voltage of 132 kV or more. In spite of the electricity supplied and transported increasing by about 34 percent, the quantum of the physical components of the network either remained static or decreased during the seven-year data period. These economies are due to better system information, operation and maintenance. As with generation, Eskom benchmarks its transmission system against other leading utilities, and manages its systems in accordance with this comparable benchmark. A comparison of transformer capacity with national peak demand shows that extensive redundancy is built into the system to cater for high loads in parts of the system. This situation is monitored and upgrading takes place where high regional load growth is experienced or expected. With a view to it forming part of the second telephone operator consortium, Eskom took the commercial risk of developing an optical fibre and microwave telecommunication system backbone along its transmission PART I CHAPTER 3 111 system, especially in less densely populated areas (Kraft, 2005). As the consortium’s bid was not successful, Eskom is negotiating the sale or lease of this system. Figure 28: Major transmission lines Table 21: Eskom transmission system Component Units 1995 2002 % change 1995 to 2002 112 Peak demand supplied MW 25 133 33 724 34.2 Electricity transmitted GWh 153 547 204 821 33.4 Energy loss % n/a 4 n/a Transmission lines km total 25 188 26 510 5.2 - 765 kV km 1 153 870 -24.5 - 533 kV DC km 1 031 1 031 0.0 - 400 kV km 13 981 15 204 8.7 - 275 kV km 7 148 7 254 1.5 - 220 kV km 1 243 1 336 7.5 - 132 kV km 632 815 29.0 Transformers Number 453 362 -20.1 Transformer capacity MVA 124 790 112 075 -10.2 THE DBSA INFRASTRUCTURE BAROMETER Distribution Distribution systems are used to connect the high voltage transmission system to final consumers. Both Eskom and municipalities distribute to end users (Table 22) and the Eskom and municipal components of the system are very similar, except for: • On average, higher end use per customer by Eskom, caused by the high consumption of the large number of industries and mines that Eskom supplies direct. • Greater use of overhead distribution lines by Eskom, and underground cables by municipalities (Table 22 ). • Many more transformers used by Eskom, but with about the same total capacity as municipalities, as Eskom has been responsible for the largest number of new low-income electrification connections. From 1995 to 2002, Eskom installed 2 134 514 of these connections and the municipalities installed 1 173 869 (National Electricity Regulator, 2002b). Table 22: National electricity distribution system, 2002 Component Units Eskom 1999 Customers 1000s 2002 % change Municipalities and others Total 2002 2002 1999 % change 3 282 3 447 5.0 3 281 3 811 16.2 7 258 GWh 101 180 104 983 3.8 71 482 79 932 11.8 184 915 customer kWh 30 829 30 456 -1.2 21 787 20 974 -3.7 51 430 Electricity losses % 3.4 3.7 8.8 6.7 4.8 -28.4 5.6 Electricity sold, end use Electricity sold per Distribution lines, total km total 331 928 277 568 -16.4 255 691 83 627 -67.3 361 195 - HV (44 to 132 kV) km total 47 151 21 159 -55.1 44 764 2 508 -94.4 23 667 - MV (1 to 43.9 kV) km total 229 259 256 409 11.8 210 927 19 910 -90.6 276 319 - LV (less than 1 kV) km total 55 518 total km total 180 845 7 239 -96.0 7 004 191 102 2 628.5 198 341 - HV (44 to 132 kV) km total 1 114 240 -78.5 279 921 230.1 1 161 - MV (1 to 43.9 kV) km total 53 926 6 999 -87.0 6 725 51 481 665.5 58 480 - LV (less than 1 kV) km total 125 805 -100.0 n/d 138 700 Transformers Number 328 258 269 777 -17.8 253 527 82 392 -67.5 352 169 MVA 250 863 192 873 -23.1 76 835 184 887 140.6 377 760 764 715 -6.4 303 2 244 640.4 1 073 61 209 61 209 Distribution cables, 138 700 Transformer capacity Average transformer capacity kVA Similar to the transmission system, Eskom benchmarks its distribution system against the distribution systems of other leading utilities. There is serious concern that the expenditure on upgrading and refurbishing of many municipal electricity networks is not taking place at the rate that is required, and that this is leading to a decrease in the reliability and quality of the supply of electricity in municipal areas. This was the purpose of the NER’s National Electricity Distribution Industry Maintenance Summit held in November 2003, at which this concern was highlighted by the Minister, policy makers, electricity distributors and users. In a brief NER study after the summit, it was confirmed that there is a considerable backlog in the required maintenance and refurbishment. The increasing occurrence of power failures in many towns and cities is indicative of this serious situation. PART I CHAPTER 3 113 Electrification The state of household electrification in 2002 is indicated in Figure 29 (NER, 2002b). It is evident that: • Urban household electrification is understandably further advanced than rural electrification (80 percent and 50 percent respectively). • The Eastern Cape, KwaZulu-Natal and Limpopo Provinces have the largest remaining challenges. • The least rural electrification occurs in the Eastern Cape, Gauteng and KwaZulu-Natal Provinces. Figure 29: Households electrified, 2002 The trend over time of the extent of urban and rural household electrification is illustrated in Figure 30. The lower line indicates an increase in households electrified in rural areas from 21 to 50 percent during the period 1995 to 2002. The upper line indicates an increase in urban areas from 76 to 80 percent over the same period. In the latter case, the actual number of households electrified has increased at a rapid rate but, due to the fast rate of household establishment, the percentage increase in electrification is smaller. Figure 30: Changes in the percentage of households electrified 1FSDFOUBHF 3VSBM 6SCBO 5PUBM This data is presented in a slightly different format in Table 23 (NER, 2002b) and indicates the extensive progress made in the increase in urban connections in the Eastern Cape, Limpopo, Mpumalanga and North West Provinces, and in rural connections in the Eastern Cape, KwaZulu-Natal, Limpopo and North West Provinces. That the percentage of urban households electrified has declined in three provinces, is due to 114 THE DBSA INFRASTRUCTURE BAROMETER the high rate of construction of new dwellings as a result of extensive urbanisation in these provinces, as is confirmed by the NER in its electrification publications. Household electrification has, in fact, proceeded at a rapid pace. Table 23: Change in status of electrification over time % of urban households % of rural households % of total households electrified electrified electrified Connections made Province 1995 2002 % 1995 2002 change % 1995 2002 change 1995 to 2002 % change Eastern Cape 67 95 42 6 38 533 28 60 114 580 663 Free State 68 83 22 33 51 55 53 73 38 266 142 Gauteng 78 73 -6 54 29 -46 77 71 -8 407 619 KwaZulu-Natal 79 69 -13 14 39 179 43 56 30 490 505 Limpopo 71 98 38 24 61 154 29 66 128 536 500 Mpumalanga 59 83 41 37 67 81 45 74 64 345 553 Northen Cape 76 80 5 47 62 32 66 74 12 71 113 North West 70 100 43 21 56 167 36 74 106 455 388 Western Cape 88 86 -2 47 65 38 82 84 2 221 815 Total 76 80 5 21 50 138 50 68 36 3 375 298 Annual new connections during the last six years are given in Table 24. The rate of installing new connections declined year by year due to budgetary constraints. The government’s medium-term expenditure framework indicates the following allocations from the DME’s budget for the National Electrification Programme: 2004/05, R1 067 million; 2005/06, R1 126 million; 2006/07, R920 million. These budgets are of the same order of magnitude as past expenditure (Table 24). Table 24: Annual new connections and annual expenditure Year 1997 1998 1999 2000 2001 2002 % change 1997 to 2002 Rural 257 193 202 487 181 025 156 701 145 335 136 695 -46.9 Urban 242 118 224 939 262 265 242 918 195 083 201 877 -16.6 Total 499 311 427 426 443 290 399 619 340 418 338 572 -32.2 1 176 1 234 1 186 1 011 909 899 -23.6 2 355 2 887 2 675 2 530 2 670 3 655 12.7 Expenditure, (R, million) Cost per connection (R) Many of the connections made since 1990 utilise low-cost technologies and prepaid metering. The Eskom systems in particular cover large areas that have to be maintained in difficult conditions, and higher maintenance costs and lower reliability can be expected. PART I CHAPTER 3 115 Liquid Fuels The liquid fuel industry is largely represented by the South African Petroleum Industry Association (SAPIA) which collects data from its membership and publishes the information in its annual report. In 2002, industry turnover was R86.9 billion, the value added R29.9 million, operating profit before interest and tax R6.1 billion, and capital expenditure R2.9 billion. This performance was the result of a sales volume of 31.4 billion litres of liquid fuel (SAPIA, 2003). Pipelines Petronet operates a number of pipelines that transport crude oil and refined oil products from KwaZuluNatal to Gauteng (Petronet, 2005). The crude oil pipeline from Durban to the Natref refinery at Coalbrook was commissioned in 1969. A refined products pipeline was added in 1971 and an additional products pipeline in 1979. A shorter pipeline for the transport of jet fuel, was constructed from Natref to Johannesburg International Airport in 1972. One of the crude oil pipelines was converted to transport coal gas from Sasolburg to KwaZulu-Natal in 1996. Total product throughput is about 16 billion litres per annum. Gas throughput is 334 million cubic metres per annum. The pipelines are illustrated in Figure 31. Figure 31: Petronet pipelines Source: IEA, 1996 Petronet operates a detailed strategic maintenance plan that is monitored by a steering committee to ensure that the culture of continuous improvement is upheld. The integrity of the pipeline network is continually monitored by, amongst other methods, an internal inspection tool, commonly known as an “Intelligent Pig”, which uses magnetic stray flux principles to determine and record any possible areas of metal loss due to corrosion and/or other events. The pipelines are also cathodically protected against electrolytic corrosion. Some of the Petronet pipelines are ageing (35 years) and replacement will be necessary in the near future. Although discussions on upgrading are ongoing, no investment has as yet been committed (Burger, 2005). It is likely that this investment will be held back until the new pipeline regulator is functioning and clarity of the regulatory approach is available. Refineries The first refinery was erected in 1954 for crude oil. Between then and 1992, when the PetroSA natural gas to liquid fuel refinery was commissioned, a further six were built, two of them for coal to liquid fuel, and one for natural gas to liquid fuel. Upgrading of some of the refineries has ensured that national refining capacity has kept ahead of local demand. Information on the operating refineries is given in Table 25 (SAPIA, 2003). The capacities of the Sasol and PetroSA refineries are expressed in crude oil input equivalents. 116 THE DBSA INFRASTRUCTURE BAROMETER Table 25: South African liquid fuel refineries Refinery Owner Location Feedstock Year commissioned Capacity (kilolitres/day) 1992 % increase 1992 to 2002 2002 Sapref BP/Shell Durban Crude oil 1963 19 080 28 620 50.0 Genref Engen Durban Crude oil 1954 11 030 18 285 64.3 Calref Caltex Cape Town Crude oil 1966 7 950 15 900 100.0 Natref Sasol/Total Sasolburg Crude oil 1971 12 402 17 172 38.5 Sasol Sasol Secunda Coal 1979, 1982 23 850 23 850 0.0 PetroSA State Mossel Bay Natural gas 1992 7 155 7 155 0.0 81 567 110 982 36.1 Total The overall percentage increase in national capacity during the ten-year period, 1992 to 2002, was 36 percent. Production is currently larger than local consumption and the surplus products are therefore exported. No plans have been announced for the construction of new refineries. All refineries are being upgraded to produce clean fuels by 2006, with a capital investment of about R10 billion (Basson, 2004). Sasol reports an approved capital allocation of R4 300 million in 2005 for this purpose (Sasol, 2004a). The average age of the refineries is 34 years (1971) but continuous upgrading and development is taking place as dictated by competitive forces, environmental and safety requirements and contacts with overseas principals. Their performance is not reported in the open literature, but it is known that they form part of the international Solomon’s benchmark report. This report is prepared on behalf of the oil industry internationally, and is not a public document. Sasol reports that, despite less-than-optimum throughput, the Natref refinery performed well (Sasol, 2004b). It achieved a total product yield of 97.6 percent and a white product yield of 92.3 percent. Unintended downtime was reduced from 0.94 percent to 0.52 percent and no major unit interruptions occurred. Road Transport An extensive road and rail tanker infrastructure exists that is operated and maintained as dictated by market conditions. No data exists on its size, age, cost or condition. Depots and Filling Stations The wholesale and retail sectors of the liquid fuel industry own and operate an extensive infrastructure for the transport, storage and marketing of its products in all parts of the country, urban and rural. All of these activities are within the domain of the private sector and no data currently exists on these facilities (Burger, 2005). The new regulatory regime of licensing all these activities by the DME, as prescribed by the Petroleum Products Amendment Act, will make it possible to collect this data in future. Gas Production of Gas Natural gas is obtained from two sources. The F-A offshore gas field off the Cape south coast has supplied gas to the PetroSA refinery at Mossel Bay since 1992. Additional investment into exploration and expanding the infrastructure for gas collection has taken place over the years. The gas reserve is sufficient for operation until about 2009. Various other investigations are underway, one being the importation of liquefied natural gas (LNG). Sasol harvests gas from the Pande and Temane gas fields in Mozambique as a feedstock for its gas-toliquid fuel plants at Secunda. This system is new and was only commissioned in 2004. Sasol produces both hydrogen-rich and methane-rich coal-based gases at its Sasolburg and Secunda plants respectively, for its own use and marketing and distribution to industrial customers. A R40 million extension to the gas plant at Sasolburg was added in 1981. Sasol indicates gas sales of 52.9 GJ in 2004, PART I CHAPTER 3 117 Box 10: Energy efficiency and Eskom’s DSM programme There is a growing concern to promote energy efficiency as the prospects of an energy shortfall and high prices associated with new developments emerge. An estimated 10-20% energy consumed could be saved through greater energy efficiency with little or no capital cost and sometimes minor technological interventions. The South African Energy Management Association (SEMA) was established in 2002 as a non-profit organisation to facilitate dialogue between Government and the private sector in promoting energy efficiency awareness. The South African Association for Energy Efficiency (SAAEE) also formed in the same year, serves to promote energy efficiency and environmental management in industry. Government’s role: The Government is committed to energy efficiency and has tabled a strategy on energy efficiency which sets a target for energy efficiency improvements of 12% by 2014. Improvements will be achieved by enabling instruments and interventions such as legislation, audits, labels and performance standards. The DME, together with Eskom, annually hosts an ‘Energy Efficiency Week’ in July to promote public awareness through various media channels. Some of the drawbacks related to limited efforts in energy efficiency include: inappropriate economic signals; lack of awareness; information and skills; lack of efficient technologies; high economic return criteria; and high capital costs. Eskom’s DSM programme: Eskom launched a Demand Side Management (DSM) programme as an attempt to reduce total power demand and specifically to reduce peak demand by load shifting. Eskom set targets of reducing demand by 180MW in 2002 and 233MW in 2003. At a domestic level, the use of fluorescent lighting (CFL) instead of inefficient incandescent light bulbs was promoted through the Bonesa campaign. In addition, households were advised to switch geysers off during peak times. Large industries were also encouraged to shut down for maintenance during winter demand peaks by charging a higher tariff during these periods. representing about 2 percent of net energy use in South Africa, with a turnover of R1 522 million per annum. Johannesburg has a town gas system that supplies 12 000 domestic customers. Pipelines The Sasol medium-pressure gas pipeline network was completed in 1966. A 95 km connection from this network to the Sasol plants at Secunda was added in 1981. Petronet was contracted by Sasol to transport the coal gas produced at Sasolburg to KwaZulu-Natal (pipeline included in Figure 30) in 1995. Sasol and Petronet employ state-of-the-art technologies in the operation and maintenance of these networks. Sasol reports that stable operation was obtained and that gas leaks declined year-on-year despite the extension of the network (Sasol, 2004b). The number of unscheduled supply interruptions increased from 5 in 2003 to 9 in 2004 while the number of gas leaks decreased from 5 to 2 respectively. A twin undersea pipeline, one for gas and one for condensate, delivers product from the F-A gas field to the onshore PetroSA refinery at Mossel Bay. Renewable Energy No database exists for renewable energy infrastructure. Chapters 1 and 2 describe the renewable energy activities that are taking place. It is understood that the DME is investigating the creation of a database of renewable energy systems (Dawson, 2005). Renewable energy systems are mostly small, diverse and widely spread, without a dedicated infrastructure for operation and maintenance. Most projects are still of an experimental or demonstration nature and many problems with the state of the infrastructure have been reported over the years. Conclusion The electrical generation and transmission, liquid fuel conversion, and transport elements of South Africa’s energy infrastructure are, on average, three or even four decades old. The electricity distribution industry is no where near as old because of the focus on household electrification during the last decade. Eskom is in the process of bringing back into service its old and mothballed power stations in order to meet growing demand. Transmission infrastructure is owned and maintained by Eskom, which has an extremely robust maintenance regime. The state of electricity distribution infrastructure varies, with maintenance being a challenge, especially for the municipalities which have suffered from low maintenance budgets and inadequate staff capacity. Further, many of the municipalities have decided to wait for the establishment of the Regional Electricity Distributors (RED), creating a considerable backlog for maintenance and refurbishment. Pipelines in the liquid fuels industry are in the hands of the State (e.g. Petronet) and the private sector (Sasol), and have been well maintained. The gas market is very small and pipeline infrastructure is basically new and well maintained. In general terms, where Eskom, state corporations (CEF, Petronet) and private players are involved, the infrastructure has been well maintained, through rigorous maintenance programmes and attempts to keep up with international best practice. This includes state-of-the-art refurbishments and adherence to acceptable international standards. 118 THE DBSA INFRASTRUCTURE BAROMETER Water and Sanitation Introduction South Africa is a water-stressed country with a projected water deficit in the foreseeable future (DBSA, 2002). The development and management of water resources are extremely important for economic growth and South Africa has therefore invested heavily in the resource. Future capital investments are planned to keep abreast of the demand for irrigation, industry and municipal requirements, and the management system is being improved in order to manage that demand. The Department of Water Affairs and Forestry (DWAF, 2004a) asserts that: “Provided that the water resources of South Africa are judiciously managed and wisely allocated and utilised, sufficient water of appropriate quality will be available to sustain a strong economy, high social standards and healthy aquatic ecosystems for many generations.” The water services sector is characterised by much ageing infrastructure on the one hand and extensive new infrastructure on the other hand, the latter being constructed during the last ten years in order to meet service backlogs. The ownership of this infrastructure is more complex than that of water resources. Apart from the specialist role of Water Boards, water services are generally managed by municipalities, all of which have enormous backlogs, both in their provision and in their maintenance (see Chapters 4 and 5). In addition, most municipalities outside the metropolitan areas suffer from serious financial and manpower constraints. As a consequence, our knowledge of the state of their assets is, in general, weak. Water Resources South Africa is located in a predominantly arid part of the world and its rainfall patterns are among the most variable in the world. The climate varies from desert and semi-desert in the west to sub-humid along the eastern coastal area, with an annual rainfall of about 450 mm for the country as a whole, well below the world average of about 860 mm per year. Some 60 percent of South Africa’s river flows are generated from only 20 percent of the land. Mean annual rainfall distribution is illustrated in Figure 32. The need for careful water management and extensive dam storage is further illustrated by the fact that, in the summer rainfall region of the country, more than 80 percent of the rain falls within the six summer months. Figure 32: Mean annual rainfall distribution in South Africa Source: Enviro-Info, 2001 PART I CHAPTER 3 119 South Africa has more than 500 large dams, of which 50 have a storage capacity exceeding 100 million m3. The twenty largest dams and their locations are indicated in Figure 33. The country’s reservoirs store about 746 m3 of water per person - an order of magnitude higher than that for the rest of Africa. Indeed, 60 percent of the large dams in Africa are situated in South Africa and Zimbabwe. The main purpose of dams in South Africa is for irrigation and urban and industrial water supply. Less than 2 percent of the country’s electricity is generated by hydropower (World Commission on Dams, 2000). Total dam storage is approximately two-thirds of mean annual runoff. A portion of this runoff – the ecological Reserve - needs to remain in the rivers to ensure sufficient flow to maintain the ecological health of the environment that is dependent on that stream. Only part of the remaining flow can be practically and economically harnessed for usable yield. The current provisional ecological Reserves average about 20 percent of total river flow, but may vary between 12 and 30 percent, depending on the ecological needs of each catchment and riverine environment (DWAF, 2004a). Figure 33: The 20 largest dams in South Africa Note: Areas of red circles represents surface areas of dams Source: DWAF, 2005b Groundwater is also extensively used, particularly in the rural and more arid areas. It is limited by the geology of the country, much of which is hard rock, while large porous aquifers occur only in a few areas. Some coastal settlements use desalinated water to supplement their supplies during short peak holiday periods. Desalination running costs are high but it is cost-effective for short periods of high demand. Other coastal towns are stepping up efforts to recycle waste water before discharging it into the sea, the largest initiative is in Durban/eThekwini where a private sector company provides tertiary treatment and supplies nearby industries. As stated in Chapter 2, water resources are managed in 19 catchment-based Water Management Areas (WMA). The Vaal and Orange catchments both have more than one WMA because of their size and significant differences in climatic conditions and types of use along the length of the river. Figure 34 gives the location of the WMAs and shows the number and volume of inter-WMA water transfers. Some of these are simply run-of-the-river (e.g. between the Upper and Lower Orange), but others are major inter-basin transfers. These include: a) from the Upper Orange to the Fish River, b) from Lesotho to the Upper Vaal, c) from the Tugela to the Upper Vaal, and d) from the Upper Vaal to the Crocodile. The last named inter-basin transfer is of interest because it is made up entirely of treated water which Rand Water pumps over the watershed for use in that part of Gauteng that drains northwards. After it has been used, it then drains to the Crocodile catchment via various municipal sewerage systems. 120 THE DBSA INFRASTRUCTURE BAROMETER Figure 34: Water Management Areas (WMA) and inter-WMA transfers Source: Natural Water Resource Strategy, DWAF, 2004a In the northern parts of the country, covered by WMAs 1 to 5 and 8 to 10, both surface and groundwater resources are almost fully developed and utilised. Over-exploitation occurs in some localised areas. In the well-watered south-eastern region of the country (WMAs 11, 12 and 13), however, there are still significant undeveloped and little-used water resources (DWAF, 2004a). Water Services Municipal Services Most water services infrastructure is located in, and under the management of, municipalities, except for the bulk services provided by Water Boards and ERWAT (East Rand Watercare Company). ERWAT manages 20 wastewater treatment plants for Ekurhuleni Metropolitan Council and neighbouring municipalities. As a result of this spread of ownership, little nationally-aggregated information is available for the state of this infrastructure, its age, condition and spare capacity. The cost estimates for addressing infrastructure backlogs, as provided in Chapter 5, include an allowance for refurbishing and replacing existing infrastructure. It is acknowledged, however, that more information is needed in order to provide an accurate figure. In her 2004 budget speech, the Minister of Water Affairs reported that water supply to 37 percent of households was interrupted for more than one day during the previous year. That this was mainly for technical reasons rather than for non-payment is probably a reflection of both the condition and the management of the infrastructure (Sonjica, 2004). In her most recent budget speech, she explained that the monitoring of service quality by DWAF is only just starting, but that already the results show how important it is to manage infrastructure effectively. To illustrate her point, she stated that (Sonjica, 2005): “I regret to say that 63 percent of municipalities could not confirm that they met the Drinking Water Quality Guidelines. Many of them may be achieving the standard but their controls could not show it.” PART I CHAPTER 3 121 Another indication of the state of municipal infrastructure was the result of a survey, undertaken by the CSIR, of a substantial number of the wastewater treatment works in Gauteng. The survey showed that wastewater treatment by the three metros, Johannesburg, Tshwane and Ekurhuleni, and by one of the local municipalities is meeting the standards laid down by DWAF. Their budgets are generally adequate, and management staff, supervisors, works operators and laboratory staff are all competent, qualified and experienced officials. However, many of the wastewater treatment works run by other municipalities in Gauteng are producing effluent that does not meet national standards. The effluent from some works is barely distinguishable from the raw sewage that flows into the works (Wall, 2005). It is possible that the Gauteng municipalities are amongst the best resourced, whereas other parts of the country are less fortunate. A further indication of the condition of sewage treatment works is based on a recent survey of 55 works operated by DWAF in former homeland areas. In terms of age, 50 percent of the plants were constructed in the 1980s and 33 percent in the 1960s and 1970s. Their physical condition was assessed as 31 percent in good working condition and 51 percent in average working condition. Water quality monitoring is carried out daily in 42 percent of plants, while 25 percent of plants are never monitored for quality compliance (DWAF, 2003b). Water Boards In general, Water Board infrastructure is in better condition than that of the municipalities. Most Water Boards are empowered to raise whatever funds they require to operate and maintain their systems through tariffs charged for water sold to municipal and industrial clients. Income can also be used to service debt raised to build new infrastructure for future demand. Water Boards are required to balance their books to ensure financial viability and may raise tariffs as necessary, subject to DWAF approval. This has sometimes led to criticism of over-investment at the expense of municipal consumers, but investment plans are now more carefully reviewed by DWAF to minimise this eventuality. Figure 35 illustrates the current official service areas of the Water Boards, although several have recently expanded their activities into adjacent areas. Such activities include bulk supplies, managing rural schemes and assisting municipalities with general operations and management. The latter includes retail operations that entail direct interaction both with individual household customers and with large industrial consumers. The number of municipalities served by each Water Board is given in Table 26. Figure 35: Current Water Board service areas Source: DWAF, 2005b 122 THE DBSA INFRASTRUCTURE BAROMETER Table 26: Water Boards and the populations and municipalities that they serve Water Board (In order of volume of treated water supplied) Population served (‘000s) Rand Water No. of municipal clients 10 000 18 Umgeni Water 4 302 7 Sedibeng Water 1 600 17 Lepelle Northern 1 000 7 Mhlathuze Water 380 3 Bloem Water 800 5 Ikangala Water 1 530 5 Botshelo Water 821 8 Amatola Water 1 200 3 Bushbuck Ridge 1 200 2 Magalies Water 800 6 Overberg Water 2 070 4 Pelladrift Water 7 1 Namakwa Water 45 3 Albany Coast Water TOTAL 10 1 24 235 90 Source: Telephone interviews, June 2005 Irrigation The irrigated area of South Africa is about 1.3 million hectares, 10 percent of the total cultivated area. There is a wide range of types of irrigated farming. Medium- to large-scale irrigation farmers number approximately 15 000 and cover 1.2 million hectares (ha). It is estimated that there are some 40 000 small-scale irrigated farmers covering some 50 000 ha. There are also an estimated 50 000 ha of micro-scale community gardens and plots. Table 27 provides a summary of the types of irrigation scheme and their management. Table 27: Distribution of irrigation capacity in South Africa Type of scheme Total area (ha) Private schemes extracting water directly from weirs, boreholes and farm dams Holdings range: 2 – 10 000 ha Irrigation Board schemes, privately managed but often developed with government grants and subsidised loans. Scheme size range: 20 – 60 000 ha Government schemes, built and operated by government. Operating costs charged at subsidised rates. Scheme size range: 36 – 120 000 ha. Farm average size: 40 ha 450 000 400 000 350 000 Small-scale farmers (ex Rural Development Programme): 40 000 50 000 Micro-scale schemes, gardens and community plots: 150 000 (estimate) 50 000 Source: Department of Agriculture, 1998; Food and Agriculture Organisation, 1995 Irrigation consumes 10.7 x 109 m3 of water each year, 54 percent of currently usable water resources. Irrigated land contributes 25 to 30 percent of commercial agricultural production, ranging from 10 percent for maize, 30 percent for wheat, and 90 percent for vegetable, grape, citrus and deciduous fruit production for local and export markets. No information is currently available on the production of staple food crops under irrigation for household consumption (Food and Agriculture Organisation, 2000). PART I CHAPTER 3 123 Conclusion South Africa is generally well-endowed with water resources infrastructure and has plans to maintain a good level of investment and improved management of the scarce resource. Due to the dispersed and decentralised nature of municipal water services, substantive data is scarce on the condition of infrastructure assets, but the indications are that they are not in good shape outside the metropolitan and other large urban areas. Information and Communications Technology (ICT) Introduction This chapter provides a logical and visual overview of the ICT sector, indicating the place and size of stock by sector and sub-sector. Tables, figures, graphs and commentary explain the age, condition and ownership of these investments. The most prominent ICT branches are investigated in terms of the current ICT infrastructure situation in South Africa. Information is not readily available for all branches, and specifically not always for the same years for the purpose of comparison. The latest available data compiled by Technoscene (Botha, 2005) was used in this overview. Two highly significant factors make the state of ICT infrastructure, and especially its condition and age, very different from the state of transport, water, and even energy, infrastructure. These apply to South Africa probably more than to much of the rest of the world. The first factor is that delivery is mostly driven by the private sector, and customers demand a service that is, at the very least, of a reliable standard and continuously available. The organisations that supply the service and own the infrastructure are aware that, if they do not deliver, their customers will seek alternative options if these are available (fixed line telephone operation being a notable sector where there is as yet no competition), or will reduce their use of that service (less revenue accruing to the supplier). Suppliers are therefore strongly motivated to keep their infrastructure in good condition. The second factor is that the pace of technology transformation is rapid. In effect, the infrastructure gets little chance to wear out, because the installed technology becomes obsolete within a few years, or the capacity of the infrastructure is overwhelmed by increasing demand. In either event, the infrastructure is generally replaced. ICT differs from transport, energy and water in that there is little reference to the condition of the infrastructure, simply because the infrastructure that is not performing is quickly repaired or replaced. There is also little reference to infrastructure age as it is not worthwhile for the industry to collect such statistics. An exception may be where the basic infrastructure components remain but have been upgraded many times in order to keep up with technology transformation (e.g. satellite tracking infrastructure). In the case of PCs, age is not an issue because the real price of equivalent PC capacity has declined so fast over the years, and there is only a weak second-hand market. This has been especially significant during the past two years with the strength of the rand and the declining real cost of a PC. In this section therefore, statistics are rather presented as historical and projected growth of the volume and capacity of infrastructure and the numbers of installations. If necessary, readers can infer infrastructure age from this information, and from the rapid turnover of infrastructure. Information Technology Information technology investment (excluding communication technology) is discussed in terms of market size, indicating annual investment in infrastructure. The total installed base could be viewed as being three to five times the annual market, since this is a typical time slot for the replacement of IT hardware and software according to the depreciation models used by most organisations. Total spending in the South African IT industry is expected to reach R49 billion in 2005, mostly accounted for by financial services, retail companies and government spending. It is projected to grow to R65 billion in 2009 (Walker, 2005). The South African IT market ranks 20th in the world in overall market size, and 8th in IT spending as a proportion of GDP (Botha, 2005). 124 THE DBSA INFRASTRUCTURE BAROMETER South African IT Market in Terms of Hardware, Software and Services Market growth to 2009 can be estimated by applying a compound annual growth rate (CAGR) of 7.5 percent to the expected market size quoted for 2005. The split in investment between hardware, software and services is based on the average real split for IT market data in 2000 and 2001 (BMI-TechKnowledge, 2002). The split in the sub-market sectors – hardware (43 percent), software (19 percent) and services (38 percent) - is graphically illustrated in Figure 36. Figure 36: Composition of the South African IT market sub-sectors (percent) Expenditure on services is forecast to grow fastest (12 percent), followed by software (10 percent) and then hardware (5 percent) (BMI-TechKnowledge, 2005b). The effect of this growth on the infrastructure value of the IT market sub-sectors is shown graphically in Figure 37. Figure 37: Expected growth in South African IT market sub-sectors, 2004 – 2009 Software Spending Categories According to a market forecast for 2006, undertaken in 2002, the split in software spending is as given in Table 28 (BMI-TechKnowledge, 2002). It lists the main types of software which are systems infrastructure software (including operating systems and networking software), application development and deployment software (including programming language software) and application software (including office suites, project management software, financial software, enterprise planning software, etc). Table 28: Software spending categories Software category Percent Systems infrastructure software 47.1 Application development and deployment software 25.4 Application software 27.5 PART I CHAPTER 3 125 IT Infrastructure Spending by Economic Sector The IT spend by economic sector is given in Figure 38 and covers government, telecommunications, retail, wholesale, manufacturing, insurance and banking and financial services sectors. Spending by the financial services (26 percent) and manufacturing (26 percent) sectors in 2002 was responsible for more than half of total expenditure (BMI-TechKnowledge, 2004). Figure 38: Distribution of IT expenditure by economic sector (percent) According to Bryden (2005): “The public sector IT market is seen by most vendors as an attractive market since it is large and is characterised by extensive projects. It is also not as influenced by international fluctuations and other economic changes as the commercial sector. It is, however, a difficult market that is strongly influenced by political decision-making.” Computers Personal Computers (PC) PC annual sales in South Africa are almost 1.2 million units, showing year-on-year growth of 34.2 percent. Growth in monetary value is somewhat less, because the lower price of imported hardware has capped revenue growth at 24 percent, with an overall value of R9.3 billion (Botha, 2005). A summary of PC sales for 2004 is given in Table 29. Table 29: PCs sold in South Africa in 2004 Number of PCs sold Investment in PCs 1 170 404 R9.372 billion Corporate refresh cycles are typically four years, and IT investment has become part of a more positive strategic process rather than a necessary process governed by the age of infrastructure. Most of the PCs sold are still of the desktop type (77 percent), but mobile PCs are gaining market share (20 percent), the balance being servers (3 percent) (Botha, 2005). Networks Computer network infrastructure consists of routers and switches and network connectors, mostly in the form of cable. The backbones of the infrastructure are optical fibre in wide area networks (WAN) and copper twisted pair in Local Area Networks (LAN). The new trend is towards wireless networking which could be fixed line wireless where the data is conducted via an optical fibre, or copper line and then distributed wirelessly via a wireless modem in a working environment (WLAN). Alternatively, data transmission could be accommodated over long-range wireless networking as in third generation (3G) wireless that was first introduced into South Africa at the end of 2004. 126 THE DBSA INFRASTRUCTURE BAROMETER The move to third-generation wireless The cost of making a call technology will build upon the numerous Research published by the South Africa Foundation (2005) highlights benefits of 2.5G wireless. 3G will also add the discrepancy between South Africa and other comparable streaming audio and video capabilities to countries in terms of telecommunications costs. For example, the wireless networks. Wireless networking can cost of ADSL in South Africa is 139 percent more expensive than the average price out of the 15 countries surveyed. Local call costs increase efficiencies in just about any industry(peak) are 199 percent more expensive than the average price of all specific market. The infrastructure is in place but the countries surveyed. The supply of fixed line telephony is skewed needs to be upgraded for 3G. The real advances towards the business sector and the wealthy residential sector. are likely to be in the software and hardware The report found that there were clear indications that “Telkom’s spaces. pricing structure is excessive and that some sort of intervention in the market may therefore be appropriate” (SA Foundation Wireless availability of mobile office 2005. p.15). Gillwald (2005) indicates that the stalling of the applications (e.g. e-mail, web access, messaging second national fixed line operator and the de facto continuation and intranet applications) will not only free of Telkom’s monopoly is cause for concern. Local call prices have staff to work away from their desks and nearly doubled since the privatisation of Telkom despite significant introduce a higher level of telecommuting, but efficiency gains. The SA Foundation research indicates that a few steps can there are also very few robust, full-function be taken to reduce the phone bills of most subscribers by up to programmes available for wireless use. The 30 percent. Telkom should abolish minimum charges for phone full promise of wireless networking will not calls and charge fixed-to-mobile calls on a per second basis. be fulfilled until there are powerful industryMinimum charges and per minute billing artificially inflate the specific applications that can run on mobile price by 10–20 percent. Also, implement regulations that require the interconnection fee charged by the two largest mobile systems. phone companies to be priced at cost. Reducing the cost of Mobile devices are the other weak link in interconnection could take another 10-15 percent off the average the wireless information chain. Personal digital Telkom bill. Lastly, require Telkom to offer a residential tariff plan assistants (PDA) and cell phones with data comprising a flat monthly fee and free local calls, as is the case in handling capacity cost about half as much to many other countries. Dial-up internet subscribers, who make local phone calls to internet service providers (ISPs), will benefit most purchase and maintain as notebook PCs, and from this change. their convenience makes them far more likely Source: Gillwald, 2005; SA Foundation, 2005 to be actually used in the field. High demand coupled with recent advances in full-colour displays and user interfaces means that PDAs and other mobile devices will continue to improve and evolve. As laptops are now becoming available with embedded WLAN adapters, their ease of use will also improve. If 3G and later variations deliver on their promises, the future for mobile and wireless technologies will be secured. It is possible that the time will come when all networks are wireless, replacing the hard-wired networks which are the current standard. It is expected that there will be 500 000 wireless LAN-capable PCs in South Africa by 2007; of these, 250 000 will be enabled. The leading market sectors that will use mobile data include banking, retail/wholesale, communications, media, entertainment, security, education, private healthcare, business and legal services. The Internet The Internet comprises intranets, extranets, websites, e-mail and file transfer protocol. The value of the South African Internet market was estimated at R2.5 billion in 2003, up by 9 percent from 2002. Telkom earned an additional R820 million from Internet services in 2003, bringing the total investment in Internet usage to R3.3 billion (BMI-TechKnowledge, 2004). First-tier Internet Service Providers (ISP) are wholesale resellers of bandwidth, while second-tier ISPs purchase international, and sometimes local, bandwidth from the first-tier ISPs. Internet services are supported by an Internet backbone which consists of international and national links. The services are then provided by ISPs and Value Added Network Suppliers (VANS). The services include connectivity between the end-user and the backbone, and e-mail and website hosting. There were 200 ISPs and 124 VANS in South Africa in 2003. The major impact on Internet use has been ADSL (Asynchronous Digital Service Line) services offered by Telkom and fixed line wireless (MyWireless) provided by Sentech as broadband digital access channels. These access technologies are popular for home and small business use, whilst ISDN and leased line are still popular for business. ADSL lines cannot be used for website hosting, since dynamic rather than fixed domain numbering allocation is used. The roll-out of wireless networking takes place as public and private access points, or PART I CHAPTER 3 127 “hotspots”. Wireless LAN is referred to as WiFi (Wireless Fidelity). The estimated number of hotspots was 130 at the end of 2003, but is increasing fast, with hotels, airports and coffee shops offering them to their clients. The last three years have seen a dramatic slowdown in Internet access growth in South Africa. Growth in Internet access in 2002 was about 7 percent, the slowest since the Internet became available to the South African public in 1993, and the first time it had been below 20 percent. In 2003, growth was set to be only 6 percent, with 3.28 million South Africans having access to the Internet by the end of that year. This is only 1 in every 13 South Africans, marginally better than the 1 in 15 at the end of 2001. Growth in overall subscriber numbers will initially be the main source of overall bandwidth demand growth, although in South Africa, broadband penetration is now the major driver. In a survey of small, medium and micro enterprise (SMME) usage of the Internet, almost half the SMMEs surveyed reported e-mail as their primary use of the Internet, while a third cited banking as their primary online activity. On-line banking reached the 1 million mark in South Africa for the first time at the end of 2003. This means that the number of on-line bank accounts in South Africa grew by 28 percent and the number was expected to increase further, by more than 30 percent, during 2004 (Botha, 2005). Communication Technology Communication technology comprises fixed line and mobile communications for voice and data, as well as radio, television and satellite. Convergence has brought digital satellite TV into the residential domain as both an interactive and a data medium. Fixed Line Both voice and data services are available by fixed line. The major fixed line providers in South Africa include Telkom (which holds 99 percent of the market), ESKOM and Transtel. The market share in fixed line infrastructure by these major service providers over the period 1998 through 2004 is shown in Table 30 and the capital investment by Telkom is given in Table 31. Table 30: Fixed line service providers and their installed infrastructure base in South Africa, 1998 - 2004 Fixed line service provider 1998 1999 2000 2001 2002 2003 2004 Source ‘000s of fixed access lines Telkom 4 645 5 075 5 493 4 926 4 924 4 884 4 821 Telkom Prospectus, 2003 BMI-T Telecommunications Handbook, 2004 ESKOM - - - - - - 30 BMI-T Telecommunications Handbook, 2004 Transtel - - - - 52 43.5 43 BMI-T Telecommunications Handbook, 2004 4 645 5 075 5 493 4 926 4 976 4 927.5 4 894 Total Table 31: Total fixed line capital expenditure by Telkom, 1998 - 2004 1998 1999 2000 2001 2002 2003 2004 Source Rand, million Total fixed line capitalexpenditure 128 6 513 11 457 8 468 8 297 6 962 4 013 THE DBSA INFRASTRUCTURE BAROMETER 3 862 Telkom Prospectus, 2003 The growth in the fixed-line telecommunications market (earnings from data and voice services) has been primarily due to increased fixed-line usage by Telkom’s global and corporate customer segment, increased Internet traffic and the introduction of new value-added voice and data products and prepaid fixed-line services. Telkom’s introduction of prepaid fixed-line services was the first prepaid fixed-line service in the world to be made available to customers. Long-term growth is expected to continue to be driven by increased Internet use, increased use of data services and the development and adoption of new data products and services. Growth, however, may level off due to a significant decrease in the roll-out of new fixed access lines, and the continued migration of users from fixed-line services to mobile services (Botha, 2005). Projections of Investment in Fixed Line in South Africa The cumulative investment in fixed line infrastructure in South Africa is indicated in Table 32. Table 32: Projection of fixed line infrastructure investment, 2004 - 2009 Fixed line investment in South Africa (R billion) 2004 Cumulative investment Capex per annum 5.000 2005 2006 2007 2008 2009 5.109 5.192 5.252 5.293 5.318 0.109 0.083 0.060 0.041 0.025 CAGR (%) 1 Source: Hurst, 2005 A slowdown in capital expenditure per annum is expected in fixed line infrastructure and is related to the decline in the number of fixed-line subscribers. The other fixed line providers, ESKOM and Transtel, will both form part of the second national operator (SNO). Fixed Line International Connectivity Telkom offers international connectivity from two international switching centres to terrestrial, satellite and submarine cable routes. The satellite earth station is situated at Hartebeeshoek, west of Tshwane. Further international connectivity has been provided with the deployment of very small aperture terminals and other satellite transmitters located at global and corporate customer premises throughout the country. A submarine cable system, SAT-3, connects Cape Town with Europe, Western Africa and the Far East. Telkom is the largest capacity owner on SAT-3, with the right to use approximately 65 percent of the combined capacity. Consistent with its strategy of increasing international carrier traffic on its network, Telkom has invested approximately $85 million in submarine cable systems that provide fibre optic connectivity between South Africa and international destinations. The cable systems utilise the latest technology available in order to provide improved high-speed voice, data, video and other on-demand high-bandwidth services. These systems have increased fibre optic bandwidth between Europe and Africa significantly. A major concern of the fixed line operators in terms of being able to offer competitive and new services has been access to affordable international connectivity. Local Internet exchanges are being implemented, bringing local traffic back home, and a regional exchange which will eventually offer pan-African peering is on the cards. At the same time, the shift from voice to data traffic continues unabated, and the regulatory issues surrounding Voice over Internet Protocol (VoIP) are becoming more urgent. Data Services The data services sub-sector is diverse and structured with numerous licensed operators catering for a considerable corporate market, comprising mining, financial and service-oriented industries. This market is expected to reach R18 billion per annum during 2005, showing a compounded annual growth rate (CAGR) of 27 percent. With the eventual entry of a second national operator, data and Internet services are set to grow, PART I CHAPTER 3 129 with long-term growth prospects lying in broadband access. Sweeping liberalisation measures announced in September 2004, effective from February 2005, include the legalisation of VoIP, which is set to change the country’s telecommunications landscape fundamentally. Mobile Infrastructure South Africa currently has about 22 million mobile subscribers (BMI-TechKnowledge, 2005b). By 2009, this could increase to some 30 to 35 million subscribers, if gross subscriber numbers are included. The cumulative investment in mobile infrastructure by the three cellular operators in South Africa is given in Figure 39. A CAGR of 8 percent is evident. Figure 39: Cumulative investment in mobile telephony infrastructure in South Africa, 2000 – 2009 Mobile Voice Compared to Data The mobile data applications with the highest growth include financial services and related sectors, and involve mobile operators, Wireless Application Service Providers (WASP) and content service providers. Mobile data applications in the financial sector include CRM (customer relationship management), collaboration and banking. Total mobile operator data revenue was R2.1 billion, 4.8 percent of revenue, in 2004. Consumer applications still largely drive the mobile data market, especially the youth market. This highlights opportunities for growth in certain types of early adopter applications that may be considered in financial services and other related sectors (BMI-TechKnowledge, 2005b). Third Generation (3G) cellular technology involves super-fast networks and provides an Internet connection that continuously links the user through the mobile phone to global communications infrastructure. Both Vodacom and MTN started to introduce 3G mobility in South Africa from 2004. This technology requires an upgrade in infrastructure. Siemens is supplying Vodacom for the building of its South African 3G network and will upgrade the existing GSM and GPRS network nationwide with 3G radio equipment and switches (Botha, 2005). Vodacom launched 3G in 2004 (its total subscriber base is estimated at 14 million users) and is hoping to sign up 100 000 3G subscribers by the end of 2005. BMI-TechKnowledge (2005b) anticipates that the increased availability of 3G handsets will accelerate adoption of this new technology. 3G has been pitched as a data card that enables mobile Internet access from a notebook PC. Vodacom is rolling out an initial 470 3G base stations at a cost of about R400 million and, by the end of 2004, had 3G services available in high-data-usage metropolitan areas, such as Cape Town, Johannesburg, Pretoria, Port Elizabeth and Durban, as well as some coastal holiday destinations (Mossel Bay, George, Plettenberg Bay and Hermanus). MTN predicts that 10 percent of the population on the African continent will own a 3G handset by 2010, with the greatest number of users per capita in South Africa. MTN is rolling out 3G in 2005 and has invested more than R19.2 million in the testing of its 3G infrastructure. Other Issues Affecting Fixed Line and Mobile Infrastructure Under-Serviced Licences According to BMI-TechKnowledge (2005b), some 21 of the 27 areas being nominated for under-serviced licences (USAL) are to be licensed during 2005. USAL licences provide fast-track telecommunication services 130 THE DBSA INFRASTRUCTURE BAROMETER to areas that have traditionally been underserviced. This constitutes about 38 percent of the population and 20 percent of the economic buying power. This licensing will have a huge effect on market size for the incumbent and new telecommunications operators. The combined 27 designated USAL areas constitute 21.4 million of 44.8 million people, roughly 45 percent of the South African population. SME Communications Technology Market Small- and medium-sized enterprises in South Africa spent R32.7 billion on telecommunications in 2003. This expenditure is expected to grow to R43.2 billion by 2007 (Botha, 2005). Expenditure by sector shows that the retail and wholesale industry is expected to grow by R4 billion, to reach R16.6 billion by 2008, while the financial, business and legal services sector is expected to grow by R2 billion, to reach R7.3 billion over the next four years. Satellite There are 48 satellites with coverage over Africa, and these can be accessed to provide international and national voice calls, broadcasting, data and Internet services. Africa’s vast inaccessible terrain and insufficient energy infrastructure makes it difficult and costly to roll out fixed wire-line networks and fibre optic links in the heartland areas. Low-cost satellite-based Internet therefore responds to the access crisis in the region, and provides a potentially affordable opportunity for connectivity. The satellite infrastructure situation in South Africa is estimated for GEO Commercial and Military Satellite bandwidth usage, and cost and infrastructure investment as of 2005. This is shown in Table 33 (note that LEO and MEO – e.g. Iridium and Thuraya - are not included). The earth segment infrastructure includes uplink dishes, NMS equipment and terminals. Table 33: South Africa’s satellite infrastructure Organisation Telkom Sentech Multichoice (broadcast) Others, including military TOTAL C-Band & Ku-Band: Bandwidth (MHz) 540 180 Bandwidth cost (R million per annum) 107 53 Earth-segment infrastructure (R million) Age of stock Earth station reception and transmission only – no downstream infrastructure included Generations of technology, when built, installed, duration of link via service provider Condition of stock (replacement in number of years) 389 First generation 40 years old. Modernised and upgraded on regular basis. Satellite links are continuous with renewed satellites provided by Intelsat and PANAMSAT. Reasonable condition. More than 10 years before significant renewals of groundbased stock is required. 202 VPN transmissions started 1992. 1993: Analog DTH–TV. IP satellite links are continuous with renewed satellites provided by PANAMSAT and Intelsat. Good. More than 20 years of life remaining. Good. More than 20 years of life remaining. Very Good. More than 25 years of life remaining. 324 119 59 Transmissions started 1994. Equipment continuously upgraded and renewed. Satellite links are continuous with renewed satellites provided by PANAMSAT and Eutelsat. 97 28 64 Less than 2-3 years. Modern. 1 196 322 795 More than half of the satellite earth stations and other satellite infrastructure are located in Gauteng, about one-third in the Western Cape, and the balance in KwaZulu-Natal. PART I CHAPTER 3 131 Convergence Many of the infrastructure issues in ICT are driven by convergence of the two technologies, IT and communications, and the fact that voice, data, image and sound are all handled in a multi-media environment. A few drivers for ICT infrastructure are discussed here, although it should be kept in mind that convergencebased services make use of the infrastructure already discussed and the data for such infrastructure is covered in previous sections of the report. VoIP Probably the most dynamic driver following deregulation of the telecommunications industry is Voice over Internet Protocol (VoIP). Voice can be transmitted over always-on data lines at no additional cost. The integration of voice and IT makes it possible to use multi-media solutions such as videophones and to capture voice files as a record of verbal transactions. This feature is already available through computer-telephony integration switching as used in call centres. Voice communications using Internet standards will be a fast-growing technology application among South African corporations. Over and above the third that already use the technology, up to 50 percent of corporations indicate their intention to use VoIP for the first time, with a dramatic uptake expected in 2005 (Botha, 2005). While the Internet Protocol can dramatically reduce cost, it is allowed for VANs and PTNs and may not break out into the national telephone network, thus consumers who need cheaper access may not necessarily benefit. E-Government Defined broadly, e-government uses Internet-driven technology to promote more efficient and effective public administration, to provide access to information and to make government more accountable to citizens. Essentially it embraces three areas: • e-Administration (G2G): Projects that harness technology to improve government’s administration processes and its ability to work efficiently by cutting costs, making better connections between civil servants and departments, and empowering them to work smartly. • e-Citizens (G2C): Initiatives that connect citizens and improve the relationship between government and its people by improving the way government delivers public services to its citizens. • e-Society (G2B): Building better interactions with broader society by leveraging technology to work more closely with business, to procure government supplies more cheaply, to develop more efficient supply chains, and to build partnerships with communities and third parties. Flagship projects for the implementation of e-Government include: • Government Gateway. Call-centre access to government information about life events. • HANIS. The Department of Home Affairs’ national identification system which will convert 40 million paper identity records to digital format (smart cards). • SARS and its corporate partners will enable citizens and businesses to engage and transact with it online. • DeedsWeb offers a web-based interface to the property Deeds Registration System (DRS). • e-Justice has implemented new court processes, an electronic content management system in courtrooms and shared information portals. • A new National Traffic Information System houses vehicle registrations and drivers licence data and manages the registration and licensing of vehicles. National policies and approaches to e-government need to be replicated at provincial and local government levels. E-Commerce E-Commerce entails business-to-business (B2B) and business-to-consumer (B2C) transactions, the latter often termed e-tailing or e-retailing. The e-commerce retail (or e-tail) market is dominated by the top eight online retailers who, between them, account for about 80 percent of all online retail sales in South Africa. Online sales by retailers, excluding property, cars and travel, increased by 35 percent in 2003, but the increase slowed to about 25 percent in 2004. A value total of R341 million in online retail sales was achieved in 2003. This is a mere 0.14 percent of the overall retail market in South Africa. Of this amount, some R66 million of sales, or 20 percent of online retail, was recorded over the November-December holiday shopping season. It is clear that the online retail transactions still represented only a fraction of all retail transactions. 132 THE DBSA INFRASTRUCTURE BAROMETER Call Centres South Africa offers outsource providers a higher quality, more culturally-aligned front-office and back-office location, where labour costs are two-thirds of their USA or UK equivalent. The number of agent positions (AP) will increase from 38 400 in 2003 to reach 69 600 APs in 2008, a CAGR of 13 percent. The number of call centres is set to almost double, increasing from 494 in 2003 to 939 in 2008, a CAGR of 14 percent (Botha, 2005). Conclusion This section provided information on ICT infrastructure based on a simplified logical breakdown of the ICT market. A single source containing the infrastructure information could not be located, and this represents the most complete view to date of ICT infrastructure and its breakdown. PART I CHAPTER 3 133 Spotlight on the Tembisa/Kempton Park Electrification Programme The National Government recognises electrification as a key contribution to improving the capabilities and quality of life of communities in South Africa. The national electrification programme is funded through Eskom and municipalities, and is viewed by observers as a major success. The target set by President Mbeki in his State of the Nation address in 2004 was that each household in South Africa would have access to electricity by 2012. In Tembisa, a large urban and peri-urban settlement adjacent to Kempton Park, the Ekurhuleni Municipality was contending with a backlog in electrification, poorly-maintained electrical infrastructure, many illegal connections, and serious overloading of its distribution networks. The illegal connections to the electricity distribution network posed grave environmental and safety risks to the community and loss of revenue for the municipality. Other sources of energy widely used by domestic consumers were wood, paraffin, coal, candles, dry and car batteries, diesel and LPG. The Tembisa/Kempton Park Electrification Programme, which commenced in 1996, sought to address the problems by rehabilitating electrical infrastructure, developing new infrastructure, and promoting effective service delivery and efficient revenue collection and management. The project was undertaken as an Agence Francaise de Developpement/DBSA partnership, at a total cost of R45 million spread over five years. Of this amount, DBSA contributed R30 million. The borrower was the then Tembisa/Kempton Park Metropolitan Substructure of the North East Rand Transitional Metropolitan Council (DBSA, 2004). The community was initially opposed to the initiative. Community involvement in the project was thus a priority. A consulting company was engaged to develop a marketing strategy that was informed by a community survey. The community was involved at all stages of the project cycle through workshops, meetings, street shows, billboards, pamphlets and radio shows broadcasting in the three main languages used in Tembisa. Based on experience gained from past problems, the municipality devised new methods of installation. For example, as overhead cables were easy to tamper with, they were substituted with underground cabling. To address the problem of non-payment for services, the municipality introduced a high-tech prepayment metering system instead of conventional meters. A protective system for the meters was also provided. 134 THE DBSA INFRASTRUCTURE BAROMETER This consisted of a heavy metal cover needing a hydraulic pump to lift it, as well as an alarm linked to the municipality when there was unauthorised entry. Customer Care Centres were established to assist consumers with payment procedures, with buying electricity units and difficulties arising from the use of the meters. Consumer satisfaction continues to be regularly monitored and measured by these centres. Approximately 345 local residents were employed during the construction phase and small businesses, such as welding, improved local income generation. The company that provided the metering kiosks makes a special effort to employ local people, especially those with disabilities. Eight thousand households in Tembisa have benefited from this programme. Thanks to the availability of electricity, the quality of life of the residents has improved. For example, electric stoves can be used instead of coal stoves that took a long time to heat, and children can do more homework as they no longer have to read by candle-light. Women and children have more time to themselves as they no longer have to fetch coal and wood. Local entrepreneurs have managed to increase sales of their products and services significantly, thanks to operational efficiencies brought about by a reliable electricity service. Due to the meter protection system and the introduction of the pre-payment system, no theft of electricity through meter tampering has been recorded since 2000. The municipality now collects from users far more of the revenue due. Previously, monthly revenue collection averaged R900 000, whereas the average revenue collected is now R6 to R7 million per month. The increase in revenue is not due only to the project, but also efficient cost recovery, through the prepayment meters. The improved service associated with the project has enhanced efficiency and communication with the community, and could have led to improved confidence by the community in the municipal revenue collection system. Surveys now show that there is a high level of satisfaction with the electricity service. High payment levels, almost 100 percent, and general acceptance of the prepayment method are also an indication of the success of the project. The Tembisa/Kempton Park Electricity Department, together with Intelligent Metering Systems, won the Residential Category of the prestigious 2002 eta Award for promoting energy efficiency. The eta awards are sponsored by Eskom and endorsed by the Department of Minerals and Energy, and recognise people and companies who have made significant contributions to energy efficiency. The programme is an excellent example of the success and benefits that can accrue to communities from the provision of electricity. It is also an illustration of how a project can improve efficiency and service delivery by a municipality. SPOTLIGHT ON THE TEMBISA/KEMPTON PARK ELECTRIFICATION PROGRAMME 135 Part I: Conclusion The historical overview of the growth and development of some of South Africa’s key infrastructure sectors indicates how the country’s infrastructure development was both dependent on such infrastructure development and, at the same time, has facilitated economic development. The history of the energy sector illustrates how economic development hinged on this important resource, and similarly how the development of the mining industry facilitated the overall development (and growth) of the nation. It also shows how South Africa’s water scarcity has dictated development, and how successive governments have expended much legislative effort and funds on establishing water use rights and building infrastructure to manage this scarce resource and to support irrigation. Transport was, and still is, quite literally, the country’s “arteries”, connecting people and enabling development. While the pre-1994 period was characterised by an emphasis on transport for economic development, the post-1994 period has been increasingly devoted to transport as a tool for social development. This concluding note offers a synthesis of the key characteristics and challenges facing each of the sectors, and attempts to discuss some institutional, regulatory, maintenance and environmental dynamics that restrict infrastructure growth and development. Each of the four sectors selected for in-depth discussion in Part I is unique and is characterised by its own set of issues. From Chapters 1 to 3, it is clear that transport is a complex sector with many modes (roads, rail, ports and airports and pipeline), several delivery agents and a vast array of delivery mechanisms. While ACSA airports and the national road network are successfully reformed and are performing well, urban and freight rail, metropolitan public transport and the renewal and maintenance of provincial roads are areas where delivery has generally worsened over the last 10 years. While most forms of energy are available in all parts of the country, coal has dominated. The abundant resources of coal have enabled South Africa to enjoy one the cheapest sources of electricity in the world. Since 1994, the main focus of national policy has been towards improving access to energy and the provision of an environmentally-sustainable future for South Africa. Given the uneven distribution and high seasonality of rainfall in most parts of the country, the availability of a reliable source of water has always been an absolute priority for all residents of South Africa. Since 1994, the entire water sector has benefited from a policy and legislative overhaul, addressing the severe inequities of the past and producing state-of-the-art water resources management. Water services have also been addressed and the new policies have been accompanied by massive fiscal injections to speed up the delivery of basic services throughout the country. This sector shows considerable achievements over the last decade (refer Chapter 4) but many challenges still remain. It is only during the past decade that the ICT sector really gained momentum. The World Wide Web became available in 1993, and the first cellular networks were launched in 1994. ICT differs from the other three sectors in that it is characterised by mostly private sector (and parastatal) service delivery providers. In addition, ICT is not constrained by physical boundaries, although it must comply with local policies. As indicated, ICT consists of information and communication technologies, radio, TV and broadcasting, mail services and networks. Many of the typical ICT components are rapidly converging into smaller, user-friendly mobile devices that transform the way we work, transact and play. The arrival of high speed wireless access and the initiation of the new submarine cable have brought about the opportunity to connect more people. More than 90 percent of Africa depends on satellite services for connectivity. In considering the four sectors together, we can observe a number of common constraints. • Delivery suffers as a result of institutional and capacity constraints. In regard to transport, metropolitan areas are the epicentres of the “first” economy. They are also the location where much of the integration between the first (developed) and second (under-developed) economies takes place. The optimal functioning of these areas is critically dependent on transport system efficiency, but ever-growing levels of congestion threaten the economic sustainability of these areas. The situation is worsening, partly as a result of the complex institutional arrangements. The national sphere is responsible for primary roads, rail and, through the provinces, some bus subsidies; the provincial sphere for secondary roads, some bus subsidies and minibus “taxi” regulation; and the local sphere for some bus subsidies and some local road infrastructure. Ideally, all these components should be integrated and devolved to Transport Authorities. 136 THE DBSA INFRASTRUCTURE BAROMETER The Transport Authorities (as defined in the NLTTA) are, however, slow in taking on their responsibilities as local government delivery agents, with only eThekwini (Durban) (refer Box 2) being currently in place. National government should provide support for the Transport Authorities, and assist metropolitan areas to ensure that they are operational as soon as possible. This devolved responsibility should include most infrastructure and all operational components of transport, including commuter rail, bus and minibus “taxis”. The minibus “taxi” recapitalisation programme should also be aligned to achieve these objectives, together with a more effectively enforced permit system. The energy sector consists of a mix of both public and private sectors. In the public sector, there are a small number of large and very effective public corporations (e.g. Eskom, CEF, PetroSA, Petronet), as well as a large number of municipal electricity departments, both small and large. Many municipal undertakings are not effective, and a process of converting the present diversified electricity distribution system to a small number of Regional Electricity Distributors (RED) is well advanced. Work is underway to establish the national water resources infrastructure agency to manage the future construction and operation of dams and other infrastructure. This will still require careful structuring, monitoring and regulation in order to ensure that the agency does not degenerate into an inefficient parastatal. The plans to establish Catchment Management Agencies to manage water allocations democratically will require careful attention to the capacity of those responsible for both the technical and “political” aspects of their operations. In similar vein, those responsible for transforming Irrigation Boards into Water User Associations will require much competence and wisdom. • Infrastructure assets need to be maintained – is there sufficient capacity? It is clear that the quality of provincial roads has declined over the past decade. Besides the challenge of funding, road maintenance and rehabilitation and new road construction are hampered by a lack of necessary skills and an overly broad mandate for delivery at provincial level. The current proposal to narrow the mandate of provinces by devolving responsibility for rural access roads to District Councils, will partly solve this problem. However, it will create further delivery challenges for already overstreched district councils. The establishment of roads agencies, similar to that of Limpopo Province, could sharpen the delivery focus through enhanced accountability, a focus on attracting and developing appropriate technical and management skills and linking funding to performance criteria. The maintenance problem is aggravated by overloading, and general traffic enforcement continues to remain a challenge. This is particularly true for provincial roads, where the standard of infrastructure and maintenance is low and targeted enforcement is difficult to achieve. While issues of accessibility dominate the public transport debate in rural areas, the quality of rural roads and the safety of public transport operators remain the most important challenges. Electricity operation and maintenance follow international best practice and benchmarks in some sectors, and seem to be successful, but have lagged in several local government electricity departments for a number of reasons. Expenditure on maintenance has been inadequate, and has resulted in increased numbers of failures and brownouts. Much of the energy generation infrastructure is ageing and replacement of large plants will need to commence within the next ten to twenty years. This programme should be linked to future requirements for plants in terms of vastly improved emissions and greenhouse gas releases. The global concern about greenhouse gas emissions and the possibility of trading greenhouse permits create many opportunities for South Africa to invest in “clean technology”, albeit more expensive, energy conversion facilities, including renewable energy. The South African government has addressed the improvement of municipal water services with vigour. While much has been achieved, the institutional challenges will be enormous over the next decade. Due to the dispersed and decentralised nature of municipal water services, substantive data on the condition of infrastructure assets is scarce, but the indications are that this infrastructure is not in good shape outside the metropolitan and other large urban areas. This is largely due to the widespread lack of institutional capacity, both technical and financial, to operate and maintain water services and to generate sufficient revenue. The effects, such as the degeneration in effluent quality from many wastewater treatment plants, are cause for concern. In particular, capacity problems are hampering efforts to transfer existing rural water schemes to municipalities. Many of the smaller poorer municipalities, including some district PART I CONCLUSION 137 municipalities, require assistance to build their capacity to operate as Water Services Authorities and Water Service Providers. The evolution of Water Boards into regional water utilities is under discussion. However, the management of the roll-out of water services is still seen, quite rightly, as the responsibility of politically-accountable authorities and it will thus take time to develop. When Water Services Authorities have matured, and they gain the competence and confidence to successfully delegate the water services provider function to a range of organisations, there will be scope for regional water utilities – from both public and private sectors. A specific characteristic of the ICT sector is that, almost by definition, ICT infrastructure is continuously renewed. Many of the infrastructure issues in ICT are driven first by the convergence (or combining) of information and technology, and second by the fact that voice, data, image and sound are all handled in a multi-media environment. The rapid change in the ICT environment is caused by the numerous and different technologies that impact on infrastructure, in the sense that continuous improvement in performance, hardware and software upgrades and capacity expansion are required. • Regulation and efficiency. The South African rail and ports sector is characterised by some inefficiencies. The country employs more wagons, cranes and fixed infrastructure to deliver the same output as that delivered by operators in many developed and developing countries. In addition, fewer funds are available for re-investment due to high cost structures and the low revenue-earning ability of Transnet. The sharp upward shift in the proportion of freight carried by road versus rail (refer Figure 5) represents a considerable challenge. While improved road quality between the major metropolitan centres, economic shifts towards “just-in-time production” and greater trade by the manufacturing sector are partly responsible for greater volumes being moved by road, this trend is also due to the poor quality of rail infrastructure, the high cost base of Spoornet and reliability and efficiency problems. There is some scope for levelling the playing fields between rail and road, but the use of regulatory intervention to increase the cost base of road would be counter-productive to the economy and unlikely to shift much freight to rail. It is vital that interventions first tackle the high cost base and the poor reliability and inefficiency of rail and ports. While some of the problems may be immediately ameliorated by investment, the ongoing inefficiencies will require sector structural reform, resulting in a) a clearly defined role for the public sector, b) a critical review of where the private sector may bring efficiency, and c) effective regulatory oversight of what will remain a natural monopoly industry. The challenge of aligning South African ports to a hub-and-spoke strategy remains. Port restructuring, aligning each one to particular market segments, will perhaps be made easier once the Port of Ngqura comes on stream. Such port specialisation will naturally have knock-on implications for road and rail infrastructure planning, which may require different product, mode and geographic orientations to support the ports effectively. The Department of Water Affairs is in the process of gearing up to play a regulatory role instead of being a major implementer of schemes. This will occur in water resources and irrigation - after formation of the proposed water resources infrastructure agency, and in water services - as all schemes currently operated by them are transfered to municipalities and municipalities explore the range of water services provider options. Much care and attention will be needed to ensure a balance of power between the national water resources agency and the Catchment Management Agencies and Water Users Associations which it will serve. For municipal water services DWAF must attain a balance between the roles of policemen and coach, and apply the same rigour to public service providers as to private service providers. Challenges in the ICT sector relate to the failure to extend the roll-out of affordable fixed-line services and the high cost of telecommunications services. This is partly due to the lack of competition in the fixed-line sector, and the monopoly that Telkom has enjoyed since 2002 is not engendering the best telecommunications service for South Africa. Using Eskom and Telkom infrastructure, the SNO licence will remove Telkom’s monopoly and will bring much needed competition to the sector. A major issue is the cost of bandwidth which is high by international standards. The cost of dial-up connectivity is still prohibitive, not allowing subscribers to use the Internet fully and small businesses to compete effectively. South Africa therefore differs from the rest of the world in that the demand for broadband 138 THE DBSA INFRASTRUCTURE BAROMETER is still limited, partly due to the regulatory landscape and the lack of competition between national carriers. Internet Service Providers are, however, driving for broadband connectivity with a view to making the cost of doing business in South Africa more competitive. • Environmental consequences. Investment in the energy sector has been dictated first by the demand for the various sources of energy, and second, by the increasing global requirement to reduce emissions and pollution and to produce clean energy products. The sector has been modernising with an extensive increase in the use of electricity as a secondary, or refined, form of energy. This has been linked to the government’s objective of universal access to electricity for all households by 2014 and the resulting large electrification programme that is being undertaken by Eskom and municipalities. Since 1994, Eskom and the municipalities have been responsible for 65 and 34 percent of electrification respectively. This programme was initially internally funded by Eskom, but more recently has formed part of government budgets. The energy policy calls for a diversification of energy supply in order to reduce the dominant role of coal. The natural gas systems used by PetroSA to produce liquid fuels and the piping of gas from Mozambique by Sasol are two initial steps in this process. In addition, government policies on energy efficiency will lead to a decrease in existing energy demand, and the promotion of renewable energy will support this policy of diversification. Environment and energy use implications of transport are considerable. In urban areas these are exacerbated by a situation of growing levels of car dependence. Public transport could be improved through better integration, management and priority in certain high demand corridors. The difference in externality costs between road and rail (freight) traffic is currently unknown. Rail is however likely to exhibit lower overall externalities on the high demand corridors. Selective regulation to favour rail should be considered, but only once rail efficiency and effectiveness improvements become evident. Chapter 3 drew attention to the generally poor state of municipal wastewater treatment works. This is an area of great concern since continuous poor maintenance can produce serious environmental problems throughout the country. Municipalities must ensure that they have sufficient income and allocate the funds to create and maintain the capacity needed to properly operate treatment plants. PART I CONCLUSION 139 PART II ACCESS TO INFRASTRUCTURE IN SOUTH AFRICA CHAPTER 4 Infrastructure Service Backlogs Chapter 4 describes household-level service backlogs, or the lack of access by households to selected municipal-provided services. The services selected for in-depth analysis are: water, sanitation, energy (mainly electricity), telephones and transport. This chapter presents backlog information at a provincial level. Part III provides detailed information concerning access to these services for each of South Africa’s 284 municipalities. Background South Africa celebrated 10 years of democracy in 2004. Notwithstanding the country’s political transformation and socio-economic progress, many problems persist. In particular, a large proportion of households continue to lack access to basic services provision. The main purpose of this chapter is to describe quantitatively what has happened with regard to services provision between the years 1996 and 2001. These dates reflect the years in which post-democracy population census surveys were undertaken. Introduction Part I of this report focuses on the supply and availability of bulk infrastructure for economic purposes. Part II addresses the demand for, availability of and consequent backlog supply in household infrastructure and services. The purpose of this chapter is to present a quantitative picture of the current situation with regard to water and sanitation, energy, telephones and transport. Various sources of information have been used and in so doing, the problems of interpretation, methodological compatibility and issues of definition need to be noted. The information presented (Census 1996 and 2001) compares household access to water, sanitation, energy and telephones, as well as the mode of transport used by employed workers and scholars. Projections, based on latest figures from the sectoral departments and information depicting estimates of a financial exercise undertaken early in 2005 by the Department of Provincial and Local Government (DPLG) and DBSA, together with the assistance of the Palmer Development Group (PDG), are also briefly referred to in this chapter, but are described in more detail in Chapter 5. The primary source of information for this chapter is Statistics South Africa: 2001 Census: Community Profile database. However, it should be noted that, because the defining characteristics of the 1996 and 2001 census categories differed in many instances, it was not always possible to compare information. To mitigate this problem and to facilitate a greater degree of comparability, information relating to “access to household services” was grouped into two broad categories, namely, those “without access” and those “with access”. The specific definitions attached to access to services for each sector are given in Table 34. Table 34: 1996 and 2001 Census categories Sector Water Service level 1996 Census category 2001 Census category Without access to piped water Unspecified, other, dam/river/stream/ spring, borehole/rainwater/tank/well, water-carrier/tanker Other, water vendor, river/ stream, dam/ pool/stagnant water, rainwater tank, spring, borehole Access to piped water Piped water in the dwelling, piped water on site, public tap Piped water inside dwelling, piped water inside yard, piped water on community stand: distance less than 200m from dwelling, piped water on community stand: distance greater than 200m from dwelling Without access Unspecified, none, bucket latrine None, bucket latrine With access Flush or chemical toilet, pit latrine Flush toilet (connected to a sewerage system), flush toilet (with septic tank), chemical toilet, pit latrine with ventilation (VIP), pit latrine without ventilation Energy (utilising electricity as a source of energy for lighting purposes) Not utilising electricity Unspecified, other, candles, paraffin, gas Other, candles, paraffin, gas Utilising electricity Electricity direct from authority, electricity from other source Electricity, solar Telephone No access or no nearby access Unspecified, dummy, hostel/ institution: No telephone on premises, household: no access to a telephone, household: at another location not nearby No access to a telephone, at another location: not nearby Access or nearby access Household: in this dwelling/cell-phone, household: at a neighbour nearby, household: at a public telephone nearby, household: at another location nearby, hostel/ institution: telephone on premises Telephone in dwelling and cell-phone, telephone in dwelling only, cell-phone only, at a neighbour nearby, at a public telephone nearby, at another location nearby Sanitation PART II CHAPTER 4 143 Nevertheless, the definitional, and thus the quantification, issues remain. For example, adequate sanitation in the 1996 census included chemical toilets and those households where there is sewerage provision, while pit latrines were a separate category. It is generally accepted that chemical toilets are rarely “adequate” and should be phased out. Equally, a large number of pit latrines are also far from “adequate” and, in any event, the exact number is unknown. Hence, “access to adequate sanitation” is difficult to quantify accurately. The information presented in this chapter has also been supplemented with information obtained from: • National sectoral departments, such as the Department of Water Affairs and Forestry • The National Electricity Regulator, and • The annual General Household Survey by STATS SA. It should be noted that, for this particular survey, household-level comparisons should not be made between this report and the census reports because of the differing data collection methodologies used. In summary, it means that much of the information will not necessarily correspond with that of either the DBSA or STATS SA, because different methodologies and definitions were used in calculating the backlogs. Box 11: Increase in access The total number of households (including hostel dwellers) has increased from 9.077 million in 1996 to 11.770 million in 2001, an increase of 2 693 million households. The number and percentage of households in South Africa with access to services have increased between 1996 and 2001: • Water: Access increased from 7.2 million to 10 million households, or from 79.8% to 85.0% of households. • Sanitation: Access increased from 7.5 million to 9.7 million households, or from 82.5% to 82.7% of households. • Electricity: Access increased from 5.2 million to 8.3 million households, or from 57.5% to 70.4% of households. • Telephones: Access increased from 6.8 million to 10.7 million households, or from 75.2% to 90.6% of households Note: It is assumed that all infrastructure installed since 1994 is still operational. Source: Development Information Unit: DBSA (Base data: STATS SA). Water Nationally, the incidence of households without access to piped water has decreased from 20.2 percent in 1996 to 15 percent in 2001. However, the Eastern Cape Province recorded both the highest number and percentage of households without access to piped water in 1996 and 2001. Conversely, the Western Cape Province had the highest percentage of households with access to piped water, while Gauteng Province recorded the highest number of households with piped water (Table 35 and Figures 40 and 41). Table 35: South Africa and provinces: Households with access to piped water, 1996 and 2001 1996 Province Total number of households (demand) Without access (backlog) Number Western Cape 2001 Total number of households (demand) With access (available) % Number % Number With access (available) % Number % 985 490 31 850 3.2 953 640 96.8 1 208 983 20 595 1.7 1 188 388 98.3 1 333 862 620 283 46.5 713 579 53.5 1 535 966 572 379 37.3 963 587 62.7 Northern Cape 187 596 16 710 8.9 170 886 91.1 219 981 7 249 3.3 212 732 96.7 Free State 626 339 37 610 6.0 588 729 94.0 757 261 32 201 4.3 725 060 95.7 1 665 299 561 876 33.7 1 103 423 66.3 2 200 429 570 148 25.9 1 630 281 74.1 721 652 134 149 18.6 587 503 81.4 977 950 129 724 13.3 848 226 86.7 1 967 597 79 554 4.0 1 888 043 96.0 2 836 334 68 514 2.4 2 767 820 97.6 Mpumalanga 605 110 107 886 17.8 497 224 82.2 783 003 100 826 12.9 682 177 87.1 Limpopo 984 457 241 496 24.5 742 961 75.5 1 250 363 264 823 21.2 985 540 78.8 9 077 402 1 831 414 20.2 7 245 988 79.8 11 770 270 1 766 459 15.0 10 003 811 85.0 Eastern Cape KwaZulu-Natal North West Gauteng South Africa Source: Development Information Unit: DBSA (Base data: STATS SA) 144 Without access (backlog) THE DBSA INFRASTRUCTURE BAROMETER Figure 40: South Africa and provinces: Percentage of households without access to piped water, 1996 and 2001 1996 2001 33.7 4PVUI"GSJDB (BVUFOH /PSUI8FTU 'SFF4UBUF /PSUIFSO$BQF &BTUFSO$BQF ,XB;VMV/BUBM 8FTUFSO$BQF -JNQPQP .QVNBMBOHB 1FSDFOUBHF Source: Development Information Unit: DBSA (Base data: STATS SA) Figure 41: Provinces: Number of households without access to piped water, 1996 and 2001 /VNCFS -JNQPQP .QVNBMBOHB /PSUI8FTU ,XB;VMV/BUBM &BTUFSO$BQF 8FTUFSO$BQF 'SFF4UBUF (BVUFOH /PSUIFSO$BQF Source: Development Information Unit: DBSA (Base data: STATS SA) Census 2001 (STATS SA) recorded a national total of 3.8 million, or 32.4 percent, of households with access to water in their dwellings. The Western Cape and Limpopo Provinces were in direct contrast, with 67.6 percent and 9.9 percent of households with water available in their dwellings respectively. In Limpopo Province, almost a quarter (22.9 percent) had access to a communal standpipe located further than 200 metres from the dwelling, while a further quarter (22.8 percent) accessed water from a river or stream. This latter proportion is much higher than that found in other provinces. Only three provinces, Western Cape, Gauteng and Northern Cape, achieved an above average rate for water accessed from within the dwelling (Table 36 and Figure 42). PART II CHAPTER 4 145 Table 36: South Africa and provinces: Main types of water source used by households (percent), 2001 Province Piped water inside dwelling Piped water inside yard Community standpipe: distance < 200m from dwelling Community standpipe: distance > 200m from dwelling Borehole Spring Rainwater tank Dam/ pool/ stagnant water River/ stream Water vendor Other Total Western Cape 67.6 17.6 6.3 6.8 0.1 0.0 0.1 0.2 0.2 0.1 1.0 1 208 982 Eastern Cape 18.1 19.3 11.9 13.4 1.7 6.6 2.3 2.0 22.8 0.3 1.6 1 535 968 Northern Cape 40.7 41.3 7.6 7.0 0.6 0.0 0.1 0.3 1.0 0.1 1.1 219 981 Free State 23.4 47.7 13.4 11.2 0.6 0.2 0.1 0.3 0.1 0.2 2.8 757 259 KwaZuluNatal 29.9 20.9 10.2 13.1 4.1 3.3 0.8 2.0 12.5 0.8 2.5 2 200 430 North West 18.1 36.3 16.0 16.3 5.9 0.2 0.4 0.4 0.5 2.5 3.4 977 949 Gauteng 46.7 37.3 6.7 6.9 0.2 0.0 0.1 0.1 0.1 0.3 1.6 2 836 335 Mpumalanga 21.4 38.8 12.6 14.4 3.2 0.9 0.5 1.0 2.9 0.7 3.7 783 004 Limpopo 9.9 30.6 15.4 22.9 5.2 2.1 0.3 1.9 6.1 1.7 3.9 1 250 363 32.4 29.9 10.5 12.1 2.3 1.8 0.6 1.0 6.2 0.7 2.3 11 770 271 South Africa Source: STATISTICS SOUTH AFRICA: Census 2001: Community profile database Figure 42: South Africa: Main types of water source used by households (percent), 2001 Source: STATISTICS SOUTH AFRICA: Census 2001: Community profile database According to DWAF, some 92 percent of the population had access to improved water supply in 2004. This compares very favourably with the 60 percent recorded in 1994. However, these figures reflect access to the infrastructure provided and indicate nothing about the sustainability of the service. Studies conducted on behalf of DBSA and DPLG by Palmer Development Group (PDG), indicated that some 74.3 percent of households had access to water in 2001. When comparing the DBSA Development Information Unit (DIU) figure of 85 percent of households with access to piped water, and subtracting the 12.1 percent of households with access to a public tap greater than 200m from the dwelling, the figures correlated well 146 THE DBSA INFRASTRUCTURE BAROMETER (74.3 vs. 72.9 percent). Estimates undertaken by PDG indicated that some 18 percent of households were without access to piped water in 2004. Sanitation Nationally, the percentage of households without access to sanitation decreased from 17.5 percent in 1996 to 17.3 percent in 2001. The Eastern Cape Province recorded both the highest number and percentage of households without access to sanitation facilities in 1996 and 2001, while Gauteng Province ranked first in terms of both number and percentage of households with access to sanitation. Seven provinces recorded a higher percentage of households without access to sanitation in 2001 when compared with 1996. This could be attributable to the high rate of household formation (Table 37). Table 37: South Africa and provinces: Households with access to sanitation, 1996 and 2001 Province 1996 2001 Total number Without access With access Total number Without access With access of households (backlog) (available) of households (backlog) (available) (demand) Western Cape Eastern Cape Number % Number % 93 688 9.5 891 802 90.5 1 208 982 136 509 11.3 1 072 473 88.7 35.8 856 078 64.2 1 535 967 555 265 36.2 980 702 63.8 187 596 54 523 29.1 133 073 70.9 219 981 48 662 22.1 171 319 77.9 626 339 185 991 29.7 440 348 70.3 757 259 222 889 29.4 534 370 70.6 1 665 299 278 515 16.7 1 386 784 83.3 2 200 431 375 531 17.1 1 824 900 82.9 721 652 95 734 13.3 625 918 86.7 977 948 134 429 13.7 843 519 86.3 1 967 597 109 358 5.6 1 858 239 94.4 2 836 335 164 101 5.8 2 672 234 94.2 605 110 77 720 12.8 527 390 87.2 783 005 102 002 13.0 681 003 87.0 984 457 218 531 22.2 765 926 77.8 1 250 365 294 178 23.5 956 187 76.5 9 077 402 1 591 844 17.5 7 485 558 82.5 11 770 273 2 033 566 17.3 9 736 707 82.7 North West Mpumalanga Limpopo South Africa % 477 784 Free State Gauteng Number 985 490 Cape Natal % 1 333 862 Northern KwaZulu- Number (demand) Source: Development Information Unit: DBSA (Base data: STATS SA) Figure 43: South Africa and provinces: Percentage of households without access to sanitation, 1996 and 2001 1FSDFOUBHF 4PVUI"GSJDB -JNQPQP .QVNBMBOHB (BVUFOH /PSUI8FTU ,XB;VMV/BUBM 'SFF4UBUF /PSUIFSO$BQF &BTUFSO$BQF 8FTUFSO$BQF Source: Development Information Unit: DBSA (Base data: STATS SA) PART II CHAPTER 4 147 Figure 44: Provinces: Number of households without access to sanitation, 1996 and 2001 /VNCFS -JNQPQP .QVNBMBOHB (BVUFOH /PSUI8FTU ,XB;VMV/BUBM 'SFF4UBUF /PSUIFSO$BQF &BTUFSO$BQF 8FTUFSO$BQF Source: Development Information Unit: DBSA (Base data: STATS SA) Nationally, almost half the total households (5.9 million or 49.9 percent) had access to a flush toilet connected to a sewerage system. This was followed by a quarter of households (23.2 percent) with access to a pit latrine. Some 13.3 percent of households indicated that they had no access to sanitation services. Gauteng Province recorded the highest number of households with access to a flush toilet connected to a sewerage system, while some 49.1 percent of households in Limpopo had to use a pit latrine (Table 38 and Figure 45). Table 38: South Africa and provinces: Main types of toilet facility used by households (percent), 2001 Province Sewerage Flush toilet Chemical Pit latrine Pit latrine Bucket connection (with septic toilet with without latrine ventilation ventilation tank) None Total number of households (VIP) Western Cape 80.7 5.6 0.3 0.8 1.3 3.7 7.6 1 208 982 Eastern Cape 30.9 2.2 2.0 5.6 23.1 5.6 30.6 1 535 967 Northern Cape 59.1 7.9 0.8 5.0 5.0 11.1 11.0 219 981 Free State 45.9 1.6 0.8 6.1 16.1 19.9 9.5 757 259 KwaZulu-Natal 39.0 3.7 5.2 8.9 26.2 1.2 15.9 2 200 431 North West 35.1 1.9 0.9 10.6 37.7 4.3 9.5 977 948 Gauteng 79.6 2.7 1.1 1.3 9.6 2.2 3.6 2 836 335 Mpumalanga 37.1 2.3 1.6 8.6 37.4 2.7 10.3 783 005 Limpopo 16.0 2.0 1.3 8.1 49.1 0.7 22.8 1 250 365 South Africa 49.9 3.0 1.9 5.6 22.3 3.9 13.3 11 770 273 Source: STATISTICS SOUTH AFRICA: Census 2001: Community profile database 148 THE DBSA INFRASTRUCTURE BAROMETER Figure 45: South Africa: Main types of toilet used by households (percent), 2001 Source: STATISTICS SOUTH AFRICA: Census 2001: Community profile database DWAF estimated that some 64 percent of the population had access to a basic or higher level of sanitation in 2004, this is compared with 49 percent in 1994. PDG indicated that the percentage of households with access to sanitation was 60.2 percent in 2001. The Development Information Unit (DIU) figure of 82.7 percent (indicating adequate access) included the percentage of households using a pit latrine. By subtracting the 22.3 percent of households using pit latrines from the DIU figure, the DIU and PDG information are almost equal in terms of the percentage of households with adequate access to sanitation (60.4 vs. 60.2 percent). PDG estimated that the percentage of households without access to sanitation has decreased from 39.8 percent in 2001 to 31.7 percent in 2004. Energy Households in various parts of the country use different sources of energy. This is primarily determined by the availability and cost of the energy, tradition and the availability of appliances. Paraffin and candles are generally available through the commercial retail sector in all parts of the country. In some areas, liquefied petroleum gas (LPG), coal and firewood are available as commercial products. In some places, firewood is collected locally as a free good. Electricity is the generally preferred form of energy because of its ease and convenience of use, cleanliness at the point of use and ability to power modern convenience and communications technologies such as kitchen appliances, televisions and computers. Extensive efforts have been made over the last ten years to supply electricity to the maximum number of households within the prevailing budgetary and other constraints. Nationally, households not using electricity as an energy source for lighting decreased from 42.3 percent in 1996 to 29.6 percent in 2001. The Eastern Cape Province recorded the highest number and highest percentage of households not using electricity both in 1996 and 2001, while the Western Cape Province ranked best in terms of the percentage of households using electricity as an energy source (Table 39 and Figures 46 and 47). PART II CHAPTER 4 149 Table 39: South Africa and provinces: Households not using electricity as an energy source for lighting, 1996 and 2001 Province 1996 Total number of households (demand) 2001 Not utilising electricity (backlog) % Number % 839 744 85.2 1 208 981 142 895 11.8 1 066 086 88.2 1 333 862 910 388 68.3 423 474 31.7 1 535 969 768 075 50.0 767 894 50.0 Northern Cape 187 596 55 051 29.3 132 545 70.7 219 981 49 138 22.3 170 843 77.7 Free State 626 339 268 292 42.8 358 047 57.2 757 259 188 427 24.9 568 832 75.1 KwaZuluNatal 1 665 299 772 851 46.4 892 448 53.6 2 200 431 828 289 37.6 1 372 142 62.4 721 652 403 278 55.9 318 374 44.1 977 948 280 080 28.6 697 868 71.4 Gauteng % Number Utilising electricity (available) 14.8 North West Number Not utilising electricity (backlog) 145 746 Eastern Cape % Total number of households (demand) 985 490 Western Cape Number Utilising electricity (available) 1 967 597 402 386 20.5 1 565 211 79.5 2 836 336 532 046 18.8 2 304 290 81.2 Mpumalanga 605 110 262 519 43.4 342 591 56.6 783 004 246 075 31.4 536 929 68.6 Limpopo 984 457 623 519 63.3 360 938 36.7 1 250 363 446 523 35.7 803 840 64.3 9 077 402 3 844 030 42.3 5 233 372 57.7 11 770 272 3 481 548 29.6 8 288 724 70.4 South Africa Source: Development Information Unit: DBSA (Base data: STATS SA) Figure 46: South Africa and provinces: Percentage of households not using electricity as an energy source for lighting, 1996 and 2001 1FSDFOUBHF 4PVUI"GSJDB -JNQPQP .QVNBMBOHB (BVUFOH /PSUI8FTU ,XB;VMV/BUBM 'SFF4UBUF /PSUIFSO$BQF &BTUFSO$BQF 8FTUFSO$BQF Source: Development Information Unit: DBSA (Base data: STATS SA) Figure 47: Provinces: Number of households not using electricity as an energy source for lighting, 1996 and 2001 /VNCFS -JNQPQP .QVNBMBOHB (BVUFOH /PSUI8FTU ,XB;VMV/BUBM 'SFF4UBUF /PSUIFSO$BQF &BTUFSO$BQF 8FTUFSO$BQF Source: Development Information Unit: DBSA (Base data: STATS SA) 150 THE DBSA INFRASTRUCTURE BAROMETER Census 2001 information indicated that, nationally and on average, some 8.3 million or 70.2 percent of households used electricity for lighting purposes, followed by some 22.4 percent of households that used candles. Some 2.3 million households in Gauteng Province used electricity, as compared with 169 000 households in the Northern Cape Province. The Western Cape Province recorded the highest percentage of households (88.1 percent) using electricity, compared with slightly less than half (49.7 percent) of households in the Eastern Cape Province. Some 756 000 (34.3 percent) of households in KwaZulu-Natal used candles as a source of lighting (Table 40 and Figure 48). Table 40: South Africa and provinces: Main types of energy source used by households for lighting (percent), 2001 Province Electricity LPG Paraffin Candles Solar Total number Other of households Western Cape 88.1 0.3 7.0 4.4 0.1 0.1 1 208 982 Eastern Cape 49.7 0.3 23.3 25.9 0.3 0.5 1 535 968 Northern Cape 76.7 0.2 3.8 17.7 1.0 0.6 219 981 Free State 74.8 0.2 4.6 19.9 0.3 0.2 757 259 KwaZulu-Natal 62.1 0.4 2.5 34.3 0.2 0.4 2 200 430 North West 71.2 0.1 2.9 25.4 0.1 0.2 977 949 Gauteng 81.1 0.3 2.8 15.6 0.1 0.1 2 836 335 Mpumalanga 68.4 0.3 4.2 26.6 0.2 0.4 783 004 Limpopo 64.0 0.2 7.4 27.6 0.3 0.5 1 250 363 South Africa 70.2 0.3 6.6 22.4 0.2 0.3 11 770 271 Source: STATISTICS SOUTH AFRICA: Census 2001: Community profile database Figure 48: South Africa: Main energy sources used by households for lighting (percent), 2001 Source: STATISTICS SOUTH AFRICA: Census 2001: Community profile database Electricity is a favoured source of energy for domestic lighting because both the service cost and the cost of the lamp are low when compared with other sources of energy. Cooking and space heating consume large quantities of energy, making them concomitantly expensive. The latter is further exacerbated by the capital cost of the appliance. STATS SA (2003a) information highlighted that electricity was the main source of energy that was used for lighting, cooking and space heating, with lighting being the highest percentage. The use of paraffin for cooking was higher than for heating, while the use of wood for heating was higher than for cooking. The use of coal, which leads to increased air pollution levels, was higher for heating purposes than for cooking purposes. Affordability is the main constraint in the conversion to more convenient electricity. Information contained in the National Electricity Regulator publication entitled, Lighting up South Africa, 2002, indicated that 66 percent of households in 2001 had access to electricity. PART II CHAPTER 4 151 This figure is corroborated in the studies conducted on behalf of DBSA and the DPLG by PDG, which also indicated that some 66 percent of households had access to electricity in 2001. This category had increased to 72 percent in 2004. Telephones The percentage of households with neither direct nor reasonably easy access to telephones has decreased from 24.8 percent in 1996 to 9.4 percent in 2001. This means that 3.8 million more households gained direct or reasonable access to the telephone system over this period. Notwithstanding the fact that there was an improvement in connectivity between 1996 and 2001, the Eastern Cape Province recorded the highest number and highest percentage of households with no direct access and no access via telephones in close proximity, both in 1996 and 2001. A similar trend is discernable in Limpopo Province. Gauteng Province again emerges on top in terms of the percentage and number of households with access to telephones (Table 41 and Figures 49 and 50). Table 41: South Africa and provinces: Households with access or nearby access to telephones, 1996 and 2001 Province 1996 Total number of households (demand) Western Cape 2001 No access / no nearby access (backlog) Number With access or nearby access(available) % Number % Total number of households (demand) No access / no nearby access (backlog) Number % With access or nearby access(available) Number % 985 490 44 780 4.5 940 710 95.5 1 208 983 32 550 2.7 1 176 433 97.3 1 333 862 692 709 51.9 641 153 48.1 1 535 968 309 083 20.1 1 226 885 79.9 Northern Cape 187 596 27 910 14.9 159 686 85.1 219 980 16 206 7.4 203 774 92.6 Free State 626 339 116 818 18.7 509 521 81.3 757 259 76 694 10.1 680 565 89.9 KwaZuluNatal 1 665 299 470 871 28.3 1 194 428 71.7 2 200 430 299 188 13.6 1 901 242 86.4 721 652 199 255 27.6 522 397 72.4 977 950 95 316 9.7 882 634 90.3 1 967 597 127 108 6.5 1 840 489 93.5 2 836 336 66 881 2.4 2 769 455 97.6 605 110 130 170 21.5 474 940 78.5 783 003 64 954 8.3 718 049 91.7 984 457 437 423 44.4 547 034 55.6 1 250 363 145 040 11.6 1 105 323 88.4 9 077 402 2 247 044 24.8 6 830 358 75.2 11 770 272 1 105 912 9.4 10 664 360 90.6 Eastern Cape North West Gauteng Mpumalanga Limpopo South Africa Source: Development Information Unit: DBSA (Base data: STATS SA) Figure 49: South Africa and provinces: Percentage of households with no access or no nearby access to telephones, 1996 and 2001 4PVUI"GSJDB -JNQPQP .QVNBMBOHB (BVUFOH ,XB;VMV/BUBM 'SFF4UBUF /PSUIFSO$BQF &BTUFSO$BQF 8FTUFSO$BQF /PSUI8FTU 1FSDFOUBHF Source: Development Information Unit: DBSA (Base data: STATS SA) 152 THE DBSA INFRASTRUCTURE BAROMETER Box 12: Interpreting telecom data A world telecommunications/ ICT indicators meeting took place in Geneva, Switzerland, in February 2005 to discuss the standardisation of ICT indicators. The use of ICT indicators can be misleading, and there is no one single standard for use worldwide. Although the world is still a long way from agreeing on a common set of ICT access indicators, the measuring tool used in South Africa (telephones indicated as a percentage of households) is internationally acceptable. Two measures are usually adopted - universal service and universal access. Universal service measures individual households connected to the public telecommunications network while universal access generally refers to a situation where every person has a reasonable means of access to a public telephone. Universal access can be misleading, especially when the undefined “nearby” measure is used. Example: Measuring universal service and access Telephone Service Mobile only: Telephone in dwelling: Telephone and mobile: 18.1% 10.0% 13.8% Total with a Service 41.9% Other forms of Access At a neighbour nearby: Public phone nearby: Another location nearby: Another location, not nearby: 6.6% 39.0% 3.1% 3.4% Total with Other Access 52.1% No access to telephone: 6% 6% Source: Development Information Unit: DBSA (Base data: STATS SA) Universal access = 94.0% (52.1+ 41.9) 6% 100% Total: Figure 50: Provinces: Number of households with no access or no nearby access to telephones, 1996 and 2001 From this example it can be concluded that total access to telecoms infrastructure is 94%. However, only 41.9% of households have a direct connection to the service. This leaves over 58% whose level of access to a service would benefit from further investments in telecoms infrastructure. According to Census 2001, more than 2 million (18.1 percent) households indicated that they had access to a cell phone, while 1.8 million households (13.8 percent) had access to a cell phone as well as a telephone in the dwelling. The majority of households, 4.6 million or 39 percent, were still dependent on a nearby public telephone for communication purposes. The remarkable growth in telephone connectivity is evident in that only 6 percent of households indicated that they had no access to a phone in the 2001 Census, as compared with 18.9 percent in 1996. This means that 94 percent had access to a phone in the dwelling, or a mobile phone, or had access to another phone nearby, either private or public. Almost 200 000 households in the Eastern Cape Province indicated that they had no access to a telephone. This represents about 13 percent of households and was the highest amongst the provinces in this category (Table 42 and Figure 51). Other provinces recording a high percentage of households with no access to a telephone included KwaZulu-Natal (8.6 percent), Free State (7.5 percent) and North West (6.6 percent). Table 42: South Africa and provinces: Main types of telephone used by households (percent), 2001 Province Western Cape Eastern Cape Northern Cape Telephone in dwelling and cell-phone 28.5 Telephone in dwelling only Cell-phone only At a neighbour nearby At a public telephone, nearby At another location nearby 21.6 12.8 7.0 25.5 1.9 7.7 7.8 13.8 10.2 35.2 13.5 15.8 11.6 13.7 34.1 At another location, not nearby No access to a telephone Total number of households 1.1 1.6 1 208 982 5.2 7.1 13.0 1 535 968 3.8 2.3 5.0 219 981 Free State 9.8 10.4 15.0 6.6 44.0 4.1 2.7 7.5 757 259 KwaZuluNatal 13.2 10.3 15.0 9.1 35.7 3.1 5.0 8.6 2 200 430 North West 7.1 6.5 20.4 5.0 47.7 3.6 3.2 6.6 977 949 20.5 10.8 23.6 3.8 37.8 1.2 0.7 1.7 2 836 335 Mpumalanga 8.6 6.1 22.2 4.8 46.5 3.4 3.1 5.2 783 004 Limpopo 4.4 3.1 20.2 4.3 51.2 5.1 5.1 6.5 1 250 363 13.8 10.0 18.1 6.6 39.0 3.2 3.4 6.0 11 770 271 Gauteng South Africa Source: STATISTICS SOUTH AFRICA: Census 2001: Community profile database PART II CHAPTER 4 153 Figure 51: South Africa: Main types of telephone used by households (percent), 2001 Source: STATISTICS SOUTH AFRICA: Census 2001: Community profile database One reason for the increased access to telephones in Limpopo Province is undoubtedly attributable to private sector involvement. Refer to the Spotlight on ICT at the end of Chapter 5 for an example of a private sector activity stimulating the demand for an improved service. Mode of Travel in Urban and Rural Areas Information on modes of transport used by employed persons (workers) and scholars was obtained from the STATS SA Census 2001: Community Profile database and pertains to the mode used for the longest part of the commuting distance. It is important to note that information contained in Census 2001 is not available separately for rural and urban areas. In order to address this shortcoming, specific categories of area type (as contained in Census 2001) were grouped together to estimate mode of travel information for rural and urban areas. Rural areas include the following types of settlement: sparse (10 or fewer households), tribal settlements, farms and smallholdings. Urban areas include the following types of settlement: urban settlements, informal settlements, recreational areas, industrial areas, institutions and hostels. In rural areas, some 71 percent of those employed (workers) and scholars travelled by foot, as compared with 29.4 percent in urban areas. The percentage of the employed and scholars who travelled to their workplace or school by private car in urban areas was 33 percent, while it was substantially lower (10.9 percent) in rural areas. In urban areas, minibus “taxi” was a favoured option (21 percent) whereas this accounted for only 7.5 percent in rural areas (Tables 43 and 44, and Figures 52 and 53). Table 43: South Africa and provinces: Mode of travel in urban areas expressed as percentage of workers and scholars, 2001 Province On foot By bicycle By motorcycle By car as a driver By car as a passenger By minibus “taxi” By train Other Total Western Cape 23.6 1.3 0.6 26.1 12.6 13.2 8.1 12.7 1.8 1 509 212 Eastern Cape 42.1 0.8 0.5 17.3 9.9 21.5 5.9 1.2 0.8 745 825 Northern Cape 48.6 2.6 0.4 17.7 10.3 11.2 7.3 0.2 1.6 184 400 Free State 50.6 1.5 0.5 13.6 6.6 20.2 6.3 0.3 0.5 617 553 KwaZulu-Natal 25.7 0.6 0.6 21.8 12.5 21.9 12.4 3.4 1.0 1 428 414 North West 37.4 1.8 0.4 17.2 6.9 23.1 9.7 3.0 0.5 532 726 Gauteng 22.0 1.1 0.7 27.4 8.8 25.9 6.2 7.2 0.8 3 178 326 Mpumalanga 38.8 1.4 0.7 17.3 8.9 18.4 13.5 0.3 0.8 426 377 Limpopo 42.0 1.7 0.7 21.0 11.0 15.6 7.0 0.3 0.5 212 796 South Africa 29.4 1.1 0.6 23.0 10.0 21.2 8.1 5.6 1.0 8 835 629 Source: Development Information Unit: DBSA (Base data: STATS SA) 154 By bus THE DBSA INFRASTRUCTURE BAROMETER Figure 52: South Africa: Mode of travel of the employed and scholars in urban areas (percent), 2001 Source: Development Information Unit: DBSA (Base data: STATS SA) Table 44: South Africa and provinces: Mode of travel in rural areas expressed as percentage of workers and scholars, 2001 Province On foot By bicycle By motorcycle By car as a driver Western Cape 68.9 0.8 0.4 Eastern Cape 82.9 0.4 0.5 2.9 Northern Cape 64.7 1.4 0.4 11.4 Free State 79.7 0.6 0.3 5.7 KwaZulu-Natal 71.4 0.6 0.7 3.4 North West 58.4 1.2 0.3 Gauteng 51.6 1.4 0.6 Mpumalanga 64.1 1.2 0.5 Limpopo 74.9 0.8 0.4 South Africa 71.0 0.8 0.5 5.1 By car as a passenger 8.4 9.2 By minibus “taxi” By bus By train 2.5 5.4 0.7 4.7 5.7 1.9 10.0 1.8 4.1 4.5 6.5 6.0 8.3 5.2 4.0 13.2 22.0 9.5 7.9 4.4 7.2 4.4 5.0 5.8 Other Total 3.7 216 550 0.4 0.4 662 439 0.1 6.2 65 676 1.7 0.2 0.8 219 369 7.5 0.7 1.4 991 612 15.6 1.7 0.4 511 741 4.2 2.0 0.9 178 193 6.0 14.5 0.3 1.9 504 632 7.1 6.2 0.3 0.9 1 042 893 7.5 7.5 0.7 1.2 4 393 105 Source: Development Information Unit: DBSA (Base data: STATS SA) Figure 53: South Africa: Mode of travel of the employed and scholars in rural areas (percent), 2001 Source: Development Information Unit: DBSA (Base data: STATS SA) PART II CHAPTER 4 155 The dominance of the minibus “taxi” as a public transport mode (in comparison to bus and rail) is also clearly evident. This is particularly true in the urban areas where minibus “taxis” are second only to private cars as the mode of choice. The dominance of private cars is particularly evident in the urban areas of the wealthier provinces of Western Cape and Gauteng. Both provinces exceed the national average of 33 percent, the former by 5.7 percent and the latter by 3.2 percent. In the two provinces, rail also provides an important mode of travel for 12.7 and 7.2 percent of travellers respectively. In the provinces of KwaZulu-Natal and Limpopo, bus services provide an important mode of travel for 12.4 and 13.5 percent of travellers respectively. Both are more than the national average of 8.1 percent. In the case of KwaZulu-Natal Province, this pattern is a likely consequence of the dominance of many small bus operators in Durban, while in Limpopo Province, buses provide an important mode of transport from rural areas to the small cities and towns in the province. Unfortunately, Census 2001 gives little insight into income, travel time, travel frequency and the needs of urban and rural travellers. This may be answered to some extent by the forthcoming results of the National Travel Survey undertaken by the Department of Transport, but this is not yet publicly available. Woman stopping minibus “taxi” in Soweto township outside Johannesburg. She wants to go to Orange Farm, so she pretends to be holding an orange. Minibus “taxis” are the most important form of public transport in South Africa. Other Surveys STATISTICS SA also conducts an annual national survey entitled General Household Survey (GHS). Comparisons at household level should not be made between Census 2001 and the General Household Survey 2003 (latest available) because of the different data collection methodologies used. The GHS 2003 found the following: • 86.1 percent of households had access to either piped water inside the dwelling, piped water on site, a neighbour’s tap or a public tap • In respect to sanitation, some 55.5 percent of households had access to a flush toilet connected to a sewerage system (either in the dwelling, on-site or off-site) • Electricity as an energy source for lighting purposes was used by 78.9 percent of households. • Nearly half the households (49.6 percent) indicated that they had access to a telephone in the dwelling or access to a cell phone. The results are tabulated in Table 45. 156 THE DBSA INFRASTRUCTURE BAROMETER Table 45: South Africa: Access to services, number and percentage of households, 2003 Sector Category Main source of energy for lighting purposes Electricity from mains Electricity from generator Gas Paraffin Candles Solar energy Other None Unspecified Sanitation facility Flush toilet connected to a public sewerage system (in dwelling) Flush toilet connected to a septic tank (in dwelling) Flush toilet connected to a public sewerage system (on site) Flush toilet connected to a septic tank (on site) Chemical toilet (on site) Pit latrine with ventilation pipe (on site) Pit latrine without ventilation (on site) Bucket toilet (on site) Flush toilet connected to a public sewerage system (off site) Flush toilet connected to a septic tank (off site) Chemical toilet (off site) Pit latrine with ventilation pipe (off site) Pit latrine without ventilation (off site) Bucket toilet (off site) None Unspecified Total \ Total Telephone facility Telephone in dwelling and/or cell-phone for regular use: Yes Telephone in dwelling and/or cell-phone for regular use: No Total Main source of water Piped (tap) water inside dwelling Piped (tap) water on site or in yard Neighbours tap Borehole on site Rain water tank on site Public tap Water carrier/tanker Borehole off-site/communal Flowing water/stream /river Dam/pool/stagnant water Well Spring Other Unspecified Total No. of households (‘000s) % 9 866 11 0 570 2 060 17 0 0 0 78.8 0.1 0.0 4.6 16.4 0.1 0.0 0.0 0.0 12 524 100.0 4 454 35.6 180 1.4 2 407 19.2 87 39 0.7 0.3 658 2 961 233 5.3 23.6 1.9 86 0.7 0 0 0.0 0.0 37 239 28 1 119 0 0.3 1.9 0.2 8.9 0.0 12 528 100.0 5 881 46.9 6 665 53.1 12 546 100.0 4 949 3 622 332 109 51 1 899 79 313 617 91 147 304 26 0 39.5 28.9 2.6 0.9 0.4 15.1 0.6 2.5 4.9 0.7 1.2 2.4 0.2 0.0 12 539 100.0 Note: Totals will not correspond due to rounding off. Source: STATISTICS SOUTH AFRICA: General Household Survey, 2003b PART II CHAPTER 4 157 Conclusion Although the number of households with access to services in all sectors increased between 1996 and 2001, the Eastern Cape Province continued to be the worst ranked in absolute numbers in terms of access to both basic and higher levels of service with regard to water, sanitation and telephones. KwaZulu-Natal Province was worst ranked for the number of households not using electricity for lighting purposes. The implication seems to be that, if electricity is not used for lighting purposes, it is because there is no access, meaning that the backlog of electricity distribution infrastructure is highest in KwaZulu-Natal Province. Three provinces, Eastern Cape, KwaZulu-Natal and Limpopo, recorded totals less than the national average percentage for access to a basic level of water. Four provinces, Eastern Cape, Northern Cape, Free State and Limpopo, recorded less than the national average percentage for access to basic sanitation. Those provinces that recorded less than the basic percentage for households that did not use electricity as an energy source for lighting, are the Eastern Cape, KwaZulu-Natal, Mpumalanga and Limpopo. Five provinces, the Eastern Cape, Free State, KwaZulu-Natal, North West and Limpopo, recorded less than the national average percentage for access to a basic level of telephone service. It is thus clear that Eastern Cape, Limpopo and KwaZulu-Natal are the provinces where backlogs in terms of percentage access are the highest. Taking cognisance of these backlogs, Government’s programme of action included the setting of the following targets with respect to service delivery: • Clean running water to all households by 2008/09 • Decent and safe sanitation for all by 2010, and • Electricity for all by 2012/13. Chapter 5 explains these targets in more detail. 158 THE DBSA INFRASTRUCTURE BAROMETER Spotlight on the Somerspost Water Project Somerspost residents collecting water from a standpipe Somerspost is near Sasolburg, the home of the Sasol industrial complex, known worldwide for its petro-chemical processes such as the production of liquid fuel from coal. The 120 hectare farm, Somerspost, adjacent to the old black township of Zamdela, was bought for R1.4 million for the relocation of squatter camp families whose breadwinners worked at Sasol. The DBSA provided loan funding for water infrastructure, consisting of a 2 km pipeline costing R0.6 million and reticulation to 1 111 stands costing R1.4 million. Construction of the reticulation was completed in 1995. The evaluation was done in 2004 by using the logframe approach to measure the efficiency of the activities and outputs and the effectiveness of the outcomes and impact. The objective of the project was: “To contribute towards sustaining and supplementing existing urban infrastructure to enhance the quality of life of poor communities to the degree that they are included in a process of economic empowerment and thereby contribute productively to the economic activities of the sub-region and to physically provide a community with the basic necessity of water where no such facility exists.” This objective, according to the DBSA evaluation report, was met effectively and the project activities as well as the outputs were completed efficiently. All 1 111 stands were provided with an individual connection and a water meter. Once construction was completed and the infrastructure commissioned, issues of “ability to pay” and “willingness to pay” became evident. Informal representatives declared that they were too poor, that water is “from heaven” and that they were entitled to it without payment. As a result, the payment rate for water by residents was extremely low. At one time, up to 90 percent of the residents refused to pay, the outstanding 160 THE DBSA INFRASTRUCTURE BAROMETER debt for water provision was the highest of all services, and the average age of debt was 30 months which made it unlikely that it would ever be recovered. The municipality responded by carrying out house-to-house consultations to ascertain householders’ financial positions and willingness to manage their supply. By agreement, residents who were unable to pay were classified as “indigents”, and water restrictors were installed in the inflow pipes to their houses. The restriction washer has a small hole in it and only allows 6 000 to 10 000 litres of water to flow through per month. This is a little more than the free basic water allowance of 6 000 litres per month, or 200 litres per day per household. The originally installed water meters were left for control purposes. The negative effect of the water restrictor is that many taps are not closed, and all available buckets are used to collect the free water that is coming slowly through the pipe. The municipality now subsidises the cost of water supplied with a portion of the “equitable share” of national revenue transferred from central government, supplemented by a cross-subsidy from more affluent users. The low rate of payment and the subsequent installation of water restrictors raise the question whether the capital costs of this project should have been financed by DBSA, and the municipality burdened with loan repayments, or whether only a basic level of service should have been installed, possibly with flow restrictors instead of meters. In the latter case, the municipality could have approached government for the capital costs. Note that the availability of water eased the running of households considerably, as evidenced by changing behavioural patterns, permitting, for instance, washing to be done on each or any day. Women no longer have to carry water over long distances, enabing them to engage in more productive activities. The squatters who used to live on parts of Somerspost were all relocated to the newly serviced stands. The provision of water to Somerspost also changed the appearance of Zamdela into a more attractive and enjoyable place to live in. In addition, small businesses that could not function without running water have appeared. SPOTLIGHT ON THE SOMERSPOST WATER PROJECT 161 CHAPTER 5 Modelling the Financial Implications of Municipal Service Delivery Introduction What are the financial implications for municipalities in meeting service level targets? It is necessary to predict the cost to municipalities of their meeting the national targets set for the provision of at least a basic level of service to all households. These targets are the result of policy decisions that are made by all three spheres of government. The prediction of costs is a complex task and involves many variables. The process can however be undertaken by means of financial modelling. This chapter describes such a model and then uses it to analyse a scenario involving a selected set of service target levels. The primary purpose of financial modelling exercises such as this is to assist decision-makers on service delivery. These decisions will include physical infrastructure, financial mechanisms (e.g. capital, operating costs, grants and subsidies) and the institutional arrangements necessary for the planning and implementation of infrastructure investment programmes at municipal level. This chapter deals with the financial implications of the provision of municipal infrastructure (mainly water, sanitation, electricity, roads and solid waste) and the general administrative costs for which municipalities must budget. The analysis is aggregated to a national level to represent overall costs irrespective of service provider. It thus includes non-municipal undertakings such as the Water Boards and Eskom. However, this process should take direction from the National Spatial Development Perspective (NSDP) which provides a framework of principles envisaged to guide investment decisions and influence national funding allocation priorities towards the effective exploitation of socio-economic potential and the achievement of sustainable development. This implies that much greater circumspection must be practiced by municipalities when planning for and deciding upon infrastructure investment. Clearly the choice of service level is a prime determinant in this process. The Municipal Infrastructure Investment Framework The financial model has been developed in support of the Municipal Infrastructure Investment Framework (MIIF). This Framework, which is administered by the Department of Provincial and Local Government (DPLG), aims to create a financial environment in South Africa in which sufficient funds are available to construct, rehabilitate and maintain municipal infrastructure. While the MIIF focuses on the capital account, it is also significantly concerned with sustainability. This implies that sufficient funding must be available to operate and maintain the infrastructure that municipalities are acquiring. A key responsibility of municipalities is to ensure the ongoing maintenance and functionality of services and amenities to residential households and non-residential consumers (i.e. commercial, business and industrial users) within their areas of jurisdiction. Further, good governance (and legislation) requires that municipalities or other entities providing services within a municipal area must do so in a way that the services are affordable to both the service provider (the municipality) and its consumers (households). The capital cost of providing services and amenities is met from a variety of sources, including municipal own funds, borrowings and infrastructure grants from central and provincial government and district municipalities. Private developers also construct infrastructure, the ownership of which is usually handed to municipalities on completion (the principal exception being private estates). The operating and maintenance cost of infrastructure, whether developed by the public or the private sector, is met from the aggregate of charging consumers for consumptive services (e.g. water and electricity), assessment rates levied on property and grants from national government (e.g. the “equitable share”). In many municipalities, the application of capital funds for projects to meet service delivery needs has been insufficient to allow any catching up with backlogs of unserviced households, not to mention the additional funding needed for upgrading existing services. Equally distressing is that insufficient funds have been provided in annual budgets for repairs, maintenance and asset management which, in many municipalities, has resulted in poor performance or the collapse of existing service levels. Over time, municipalities have developed a variety of tariff charges, taxation methods and crosssubsidisation of funds in an attempt to balance income with expenditure. In many cases, this has distorted the true cost of providing services, making it extremely difficult to assess affordability. Municipal accounts and PART II CHAPTER 5 163 services should be “ring-fenced” to allow transparency and the true costing of services. This is, in fact, now a requirement of GAMAP (Generally Accepted Municipal Accounting Practice), GRAP (Generally Recognised Accounting Practice) and the Municipal Finance Management Act. With the exception of the former black local authorities, which inherited vast numbers of low-income households, the consumer profile of formerly urban – based municipalities has, since 1994, changed from a situation in which the majority of consumers were predominantly middle/high income households (more than R3 500 per month) to one in which most municipalities now have a predominantly low-income household profile. The causes of this shift in household profile include: increased urbanisation through migration from areas of low economic potential to perceived areas of increased economic potential; population growth; decreased household size leading directly to increased household formation; and more recently, municipal demarcation which has brought all rural households under the jurisdiction of municipalities (refer Chapter 6). Coupled with low economic growth and high unemployment, this has resulted in many municipalities having difficulty in providing acceptable levels of service that are economically affordable both to the municipality and to its consumers. In recognition of this major task facing municipalities, government has, since 1994, progressively developed policies that endeavour to specify: a) what levels of service can be realistically provided by municipalities to low-income households, and b) what degree of fi nancial assistance can (or should) be provided to assist municipalities to undertake their functions. The MIIF has been used as an important source of reference for defining infrastructure needs, both backlog and future, and for the resultant estimates of funding requirements. Its primary role is to guide government’s infrastructure planning and multi-year budgeting requirements. The MIIF initiative commenced in the early 1990s and has been successively developed by various departments and agencies, and latterly by the DPLG. DBSA has been involved in an advisory capacity and as a co-funder. The MIIF is currently being updated through a joint DPLG / DBSA initiative. The original broad objectives of the MIIF have remained unchanged. These are: • To ensure that municipalities are able to deliver the levels of service needed for health and safety • To enable municipalities to improve existing service levels • To suggest how municipalities might structure investment in a manner that promotes economic development • To encourage municipalities to locate investment in infrastructure with a view to integrating previously disadvantaged and rural communities into the recently demarcated municipal areas. In recent revisions of the MIIF, more attention has been given to: • Estimating services backlogs and future demand • Assessing the capital costs and timeframes that are involved in removing the backlogs • Estimating the multi-year recurrent costs of operating and maintaining services • Proposing a framework for financing the capital and recurrent costs of municipal infrastructure programmes • Proposing methods for enhancing the institutional ability of municipalities to ensure that services are delivered • Suggesting how investment in, and the management of, municipal services can be used to promote development objectives which meet national goals and objectives. The analysis and estimation of addressing service delivery requires the formulation of an infrastructure investment planning strategy. This is not only important at a national level but also at provincial level and particularly municipal level. Such strategies should be essential inputs into the technical (service levels) and financial (multi-year budgeting) elements of municipal Integrated Development Plans (IDP). This chapter further explains the preliminary outcome of a financial modelling exercise undertaken in early-2005 by DPLG in partnership with the DBSA and Palmer Development Group (PDG). Its objective was to predict for South Africa as a whole the financial impact on municipalities of addressing municipal service delivery backlogs. To test this approach, the indicative models developed for each type of municipality were piloted in 14 municipalities (two for each type of municipality) (refer Table 46). These 14 municipalities were also used for the purpose of gathering input data. This exercise is complemented by a National Treasury review of the Municipal Fiscal Framework (MFF), 164 THE DBSA INFRASTRUCTURE BAROMETER which deals with the operating account and revenue-raising mechanisms for local government. It is anticipated that these studies will form the basis of National Government’s ongoing review and updating of policies relating to service delivery at the municipal level. Work continues on the financial modelling exercise as fresh data becomes available and stakeholder inputs are received. Building a Financial Model Elements of the Model The National Municipal Services Finance Model, which was developed during 2004/05, is an improved version of the series of models developed in earlier years by the Water Research Commission (WRC) and DBSA in conjunction with government and municipal stakeholders. To reiterate, its purpose is to model the future costs of providing services. The model is populated by a set of selected variables. Some of these are defined as “input variables”, and include number of existing households, service backlogs, growth estimates and service levels. Others are defined as “output variables”, and include multi-year capital and recurrent expenditure, cross-subsidy levels and household affordability. The purpose of modelling is to determine the effect of changes to the input variables on the output variables over a range of scenarios. The next section summarises current levels of access to services and of backlogs. A later section presents service delivery targets and their rate of delivery over time. A discussion of financial issues to be provided for in the model follows, and the penultimate section gives the results of the modelling on a national scale. Finally, conclusions are drawn and recommendations made. Services Included in the Model Traditionally, the following main service functions receive the most attention: • Water supply and sanitation, referred to as “water services” • Electricity • Solid waste or refuse services • Roads and stormwater. Two further elements of municipal expenditure can also be significant expenditure items for municipalities, and are thus incorporated in the model: • Public services (community facilities). The concept of service levels for public services is currently poorly defined in South Africa. It will always remain a difficulty due to the number and variability of the individual services which make up this broad grouping of public services. Nevertheless, the model provides a conceptual basis for accommodating public services. • Governance and administration. The extent to which municipalities apply effective governance, administration, planning and development (GAPD) facilitation functions is currently poorly understood. However, research undertaken for the current study and for the Municipal Fiscal Framework (National Treasury) indicates the importance of understanding this grouping. In poorly-capacitated municipalities, levels of operating expenditure on GAPD can be disproportionately high when compared with service delivery. The combination of these functions is aggregated to obtain an overall view of municipal finances in a National Municipal Services Finance Model. Types of Municipality The ability of municipalities to implement service delivery varies according their capacity and revenue-raising ability. The model provides for different levels of municipality, and their circumstances, to be assessed by adopting seven types of municipality. The case studies used in the modelling exercise are given in Table 46. PART II CHAPTER 5 165 Table 46: Municipalities used in the modelling exercise Municipality type * A B1 B2 B3 Metros Secondary cities: the 21 local municipalities with the largest budgets Municipalities with a large town as core Municipalities with a relatively small population and a significant proportion of urban population but with no large town as core Name Province Johannesburg Metro Gauteng Cape Town Metro Western Cape Buffalo City Eastern Cape Mhlatuze KwaZulu-Natal Breede Valley Western Cape Kokstad KwaZulu-Natal Cederberg Western Cape Umzimvubu Eastern Cape B4 Municipalities that are mainly rural communal areas with, at most, one or two small towns in their area Makhudutamaga Mnquma Limpopo Eastern Cape C1 District Municipalities that are not water services providers Cape Winelands Western Cape Karoo Western Cape Amatole Eastern Cape Sekhukhune Limpopo C2 District Municipalities that are water services providers Note: * Although not official, these municipality types have been used in previous policy initiatives of DPLG and National Treasury. Current Access to Services Base Data A major difficulty with infrastructure analysis is the availability of reliable sector information. An example is information relating to services at household level and associated socio-economic data regarding household affordability. Such data can be sourced from the 1996 and 2001 Census figures, but it is understood that STATS SA will only conduct a similar survey in 2011. In addition to establishing the baseline data for households with or without basic levels of service, statistics for other key variables were needed for modelling purposes. These included population and household growth, settlement types and local economic development growth estimates. During 2004, DPLG and its consultant PDG involved all national sector departments in an attempt to achieve some consensus on the baseline data to be used in the model. The departments included the Department of Water Affairs and Forestry (DWAF), Department of Minerals and Energy (DME), Electricity Distribution Industry (EDI) Holdings, Department of Transport (DOT), STATISTICS SA and the National Department of Housing. A working consensus was achieved. However it is evident that there are marked differences across the sectors in respect to definitions and methodology regarding service delivery. As an aside, the adoption of a common strategy by all stakeholders involved in the delivery of municipal services would be an important contribution to achieving the goal of affordable and sustainable services for all. The purpose of the consultation was therefore to establish and agree on new baseline data for 2004. This was achieved by combining 2001 census data with projections based upon latest statistics from sector departments, while revising some of the definitions in respect to what constitutes a backlog. DWAF has undertaken considerable work in this regard, as has EDI Holdings as part of the Regional Electricity Distributors (RED) electricity sector planning. Information on municipal roads and solid wastes remains difficult to access. The 2004 baseline data used in the model therefore differs in certain major respects (other than just updating from 2001 to 2004) from the 2001 Census data, as reported in Chapter 4. 166 THE DBSA INFRASTRUCTURE BAROMETER Summary Data of Access to Services A summary by municipality type of the current backlog in access to water, sanitation and electricity services is given in Table 47. Table 47: Summary of water, sanitation and electricity access to services (2004 estimates) Municipal category Total households (millions) Water Services Total households (millions) Energy Households without access to adequate service (No in millions) Water supply Sanitation Electricity % of households without access to adequate service Water supply Sanitation Electricity A 4.76 4.76 0.39 0.67 0.80 8% 14% 17% B1 2.16 2.17 0.31 0.57 0.45 14% 26% 21% B2 0.61 1.12 0.06 0.14 0.26 9% 22% 24% B3 1.09 1.65 0.13 0.36 0.44 12% 33% 27% B4 0.39 2.81 0.12 0.25 1.30 31% 65% 46% 1.27 1.99 36% 56% 2.27 3.98 18% 32% C1 C2 3.56 All municipalities 12.56 12.51 3.26 26% Source: PDG Note: 1. Based on figures received from DWAF for December 2004. 2. The figures are given by DWAF for water service authority areas (WSAs). Therefore, for example, there are no figures for C1 municipalities (ignoring very small numbers in DMAs) and the total number of households in B4s is very low as most of the households in these local municipality areas have the district as their WSA. 3 Figures based on DME numbers for March 2004. 4. DME reports figures by metro and LM as these are predominant as the electricity authority. The large backlogs in the Type B and C municipalities are clearly visible in Table 47 and Figure 54. Figure 55 depicts progress in addressing backlogs. Figure 54: Summary of number of households without access to adequate services, 2004 PART II CHAPTER 5 167 Figure 55: Progress in addressing backlogs, 2001 - 2004 Source: PDG, 2005 Service Level Targets Setting the Targets Having established the baseline data, it is then necessary to set targets for the progressive provision of services to address backlogs over time. The advantage of a predictive model is that the parameters important to policy can be selected or changed to assess the impact on the financial position of municipalities and the resources required from National Government. This can be achieved by setting up different scenarios. The financial implications of addressing backlogs require levels of service to be set for the different affordability levels. As an extreme, one scenario would be a high level of service for all. This would usually be totally unaffordable. At the other extreme, another scenario would be a basic level of service for all. This would usually be affordable but not practical. A third scenario could be a compromise, using a range of service levels. It is the compromise scenario, now referred to as the “chosen scenario”, which is described in this chapter. A recent DPLG publication describes the range of service levels and defines a basic level of service (DPLG, 2005). The chosen scenario uses a selection of both basic and above-basic service-level targets. The view is taken that municipalities will, at times, choose to provide higher levels of service than basic levels, even where this is not government policy. Municipalities will elect to do this because they bow to pressures from their constituents, and probably for other reasons. Targets selected for the chosen scenario include: • 35 percent of rural households to have yard connections by the end of the 10-year period • 43 percent of the urban informal population to have some form of on-site sanitation. The selection of these service-level targets, which are higher than the “basic” levels for which national funding is available to municipalities, introduces additional capital and operating costs for the service provider. This may not be affordable. For the purpose of illustrating the use of the model, the chosen scenario incorporates: • Current service level targets as set by National Government; these must be achieved by service providers through multi-year infrastructure investment programmes. • In achieving service level targets, the best approximation of what municipalities will decide in terms of selecting service levels (basic and above-basic). • Unit cost information available from national departments and national agencies for capital (internal and bulk reticulation) and operating costs, including estimations of asset management costs and household growth. • A “poverty level” definition of R800 per month or less (to be used, for example, in determining access to free basic services). Although higher poverty levels can be modelled (e.g. R1 100 per month), R800 per month 168 THE DBSA INFRASTRUCTURE BAROMETER was chosen as this is used by most municipalities in their indigent policy. Increasing the poverty level, and thus access to free basic services for a larger number of households, can have a large negative impact on affordability. • A level of cross-subsidisation, benefiting households with an income of R3 500 per month or less, to be derived from higher-income households and non-residential consumers being charged up to 35 percent more than the actual cost of the service to those customers. Service Level Targets - Summary The delivery targets for the chosen scenario and their rate of delivery over time are summarised for each service type in Figure 56. In the graphs, “adequate” relates to the level(s) selected for a particular scenario, and in this case, to the basic and above-basic service-level targets described above. Figure 56: Service delivery targets by service type PART II CHAPTER 5 169 Financing Capital Expenditure Capital budget figures for all municipalities are collected by National Treasury annually. Figures for the year 2003/04 are used in this analysis. Municipalities budgeted to spend approximately R12 billion in 2001/02 and approximately R17 billion in 2003/04. This indicates a rapid increase in capital budget expenditure, which is perhaps unrealistic as municipalities typically do not attain their budgeted capital expenditure targets. A budget of R15 billion is probably more realistic for 2004/05. Expenditure by parastatal bodies needs to be added to this figure as follows: • Water Boards: approximately R500 million (PDG) • Eskom: Approximately R1.5 billion (estimated proportion of expenditure attributable to municipal-related infrastructure) (NER). Allowing for some growth from 2003/04 to 2004/05, it is estimated that total capital expenditure on municipal infrastructure, including municipalities and service providers, is of the order of R18 billion per annum. 170 THE DBSA INFRASTRUCTURE BAROMETER Sources of Capital Capital subsidies provided by the national medium-term budget are summarised in Table 48. Table 48: Capital grant allocations in national budget (R million, nominal) Year MIG CMIP DWAF Housing Total Housing infrastructure* grants total 2003/04 47 2 246 1 102 1 960 5 355 2004/05 4 446 - 160 2 013 6 619 4 355 4 474 2005/06 5 694 - 139 2 135 7 968 4 745 2006/07 7 453 - - 2 264 9 717 5 030 2007/08 8 301 - - 2 490 10 791 5 533 Note: * “Housing infrastructure” allocation is the estimated proportion of “Housing total” spent on township infrastructure, the balance being top structure costs, as per current policy (which may change). Source: Grant figures - National Treasury Budget Review, 2003 Based on recent information on aggregated municipal accounts, it is estimated that, in 2003/04, municipalities borrowed some R2.4 billion per year and used their own capital sources (including capital development funds) of some R3.7 billion per year. It is likely that borrowing will need to increase but that an increase in the use of internal funds is unlikely. Based on this position, capital funding available to municipalities for the coming years has been estimated (in real terms) and is detailed in Table 49. Table 49: Sources of capital (R million, real, constant 2003/04 prices) Year Capital grants Borrowing Own sources Total 2003/04 5 355 2 400 3 700 11 455 2004/05 6 288 2 622 3 339 12 250 2005/06 7 191 2 865 2 855 12 911 2006/07 8 331 3 130 2 441 13 901 2007/08 9 252 3 599 2 197 15 048 Average 7 283 2 923 2 906 13 113 Split (%) 56 22 22 100 Note: Estimates of “Borrowing” and use of “Own source” funding based on 2003/04 National Treasury figures for all municipalities. “Borrowing” and “Own source” funding escalated at 10% and -5% respectively over the next three years. Even after adding R2 billion for funding raised by parastatals, the capital amounts indicated (Table 49) are considerably lower than the estimated R18 billion budgeted for municipal capital expenditure in 2004/05. This implies that municipalities are being overambitious in what they believe they can raise as capital finance, or they are expecting to increase borrowings at a much higher rates than provided for in Table 49. Operating Expenditure The 2003/04 aggregated operating budget for all municipalities is approximately R68.8 billion. There is a lack of consensus as to what constitutes adequate provision for operations and maintenance, and more comprehensive asset management. It is probable that most current operating budgets are therefore on the low side, as evidenced by numerous examples of service reliability problems. Operating expenditure incurred by other non-municipal service providers needs to be included, and is estimated as follows: • Non-municipal water services providers (source - providers’ own estimate): R1.2 billion • Eskom (source - EDIH): R20 billion. Operating expenditure on municipal services (including all municipal overheads) is therefore of the order of R90 billion per year. Operating Revenue Based on an assessment of aggregate municipal budgets from National Treasury, municipal operating revenue estimates are given in Table 50. PART II CHAPTER 5 171 Table 50: Estimates of municipal operating revenue sources (R billion) Source 2002-03 IGFR* Model Estimate Split adjusted 2003/04 (%) Property tax 12.5 12.5 15 21.7 Water and electricity tariffs 28.0 28.0 29 42.0 - 6.0 6 8.7 RSC levies 4.4 4.4 4 5.8 Inter-governmental grants ** 6.7 6.7 7 10.1 Other 10.0 4.0 8 11.6 Total 61.6 61.6 69 100.0 Other tariffs *IGFR Inter-Governmental Fiscal Review ** Equitable share and water services operating subsidy In order to obtain total operating revenue, the revenue received by non-municipal service providers is added to the municipal operating revenue. This should only include retailers, that is, those receiving revenue direct from consumers. Non-municipal operating revenues are estimated as follows: • Water services: R1.2 billion (PDG estimate) • Eskom: R20 billion (NER). Total operating revenue raised for municipal services for 2003/04 is therefore of the order of R91 billion, split into tariffs (66 percent), grants (8 percent) and other (26 percent). It should be noted that the municipal revenue of R91 billion exceeds expenditure of R90 billion. The surplus of R1 billion represents an estimate, probably low, of an amount that is in Eskom accounts and not available to municipalities. Figure 57 illustrates the different levels of expenditure and revenue raised by the various municipality types. The Metros and Type B1 municipalities are able to raise greater revenue and are thus able to provide a larger range of municipal services. The ability of the other municipalities to render at least a basic level of service, including municipal public services, needs to be investigated. Figure 57: Operating account comparison for different types of municipality based on 2003/04 figures (municipalities only, excluding non-municipal service providers) 172 THE DBSA INFRASTRUCTURE BAROMETER Subsidy Allocation to Local Government The allocation of subsidies from the national fiscus to municipalities for the year 2004/05 was R8.1 billion. The medium-term projection for subsidy allocation is given in Table 51. Table 51: Subsidy allocations to local government (R billion) Allocation 2004/05 2005/06 2006/07 Equitable share 7.3 8.6 9.4 Water services operating subsidy 0.8 0.9 1.0 Total in nominal terms 8.1 9.6 10.4 Assumed inflation (%) 6 6 6 8.1 8.5 8.7 Total in real terms (constant 2003/04) It is evident that, in real terms and on average over the three years, the medium-term budget provisions provide for relatively low levels of increase in “equitable share” and water services operating subsidy allocations. For the chosen scenario, it is assumed that this trend continues and that there is a real increase of 5 percent per annum. Subsidy allocations would then increase in real terms from R8.1 billion in 2003/04 to R12.6 billion in 2014/15. The model provides for revenue received by the municipalities as “equitable share” finance to be allocated to each service individually. The allocation is based on an assessment of what it costs to provide the service to poor consumers and how much the service is to be subsidised. Because economically weaker municipalities currently use their “equitable share” to finance their GAPD and public services functions, some of the “equitable share” is therefore allocated to these functions in the chosen scenario. Cross-Subsidy Potential The viability of the national municipal infrastructure programme is strongly dependent on the amount of cross-subsidy that can be generated. This is achieved by charging high-income households and non-residential consumers at above cost and then applying the surplus to fund services to the poor. Table 52 gives the assumed maximum levels of cross-subsidisation in excess of actual cost of service, at which tariffs to high income consumers will need to be set in order to generate a surplus in the chosen scenario. PART II CHAPTER 5 173 Table 52: Levels of surplus generated from high income consumers (percent) Category High income residential Non-residential Water Sanitation Electricity Solid waste Urban formal 30 30 30 30 Urban informal 10 10 30 10 Communal areas 10 10 30 10 Rural formal 10 10 30 10 Urban formal 20 20 34 20 Urban informal 10 10 34 10 Communal areas 10 10 34 10 Rural formal 10 10 34 10 Operating Account Table 53 gives estimates in real terms (constant 2003/04 prices) of the average annual increases in municipal accounts over the 10-year period that would be required to meet all recurrent and debt service costs. Table 53: Relative trends relating to aggregated municipal services operating accounts (percent) Percent Income from user charges increasing at 3.2 Income from rates, levies and other sources increasing at (assumed) 2.5 Equitable share increasing at 5.0 Total revenue increasing at 3.2 Expenditure increasing at 4.5 Results on a National Scale Capital Spending and Sources of Funding: Capital Grant Implications The purpose of the modelling exercise is to determine whether or not the service levels selected and the targets set for the delivery of services actually result in an affordable and sustainable investment programme. The objective of modelling is thus to determine: • If the multi-year capital projections are affordable, and how much funding municipalities will need to secure once national capital grant subsidies are exhausted • Annual operating costs, and how much income municipalities will need to raise over and above annual national recurrent expenditure grants. The model includes services irrespective of service provider, and thus incorporates the services provided by municipal undertakings, Water Boards and Eskom. The results of modelling for capital expenditure and capital finance using the chosen scenario are illustrated in Figures 58 and 59. 174 THE DBSA INFRASTRUCTURE BAROMETER Figure 58: Estimated capital expenditure for municipal infrastructure (R million at constant 2004/05 prices) Note: 2005 relates to the financial year 2005/06 etc. Figure 59: Predicted sources of capital required to cover estimated capital expenditure (R million at constant 2004/05 prices) Note: Totals approximately R142 billion over ten years The “givens” in the model are: • Total capital grant allocations (MIG and the infrastructure component of housing subsidies) increase from R9.4 billion in 2006 to R12 billion in 2008. • There is a rapid increase in levels of spending, peaking at R21 billion in 2008, driven largely by the ambitious water supply and sanitation targets. The trends are summarised as follows: • The estimated expenditure figures for 2005 may be somewhat low, only because the model uses an “S-curve” to fit a consistent trend to the results. Expenditure closer to R15 billion is more realistic • There is a rapid increase in levels of spending, peaking at R21 billion in 2008, driven largely by water and sanitation national targets • The use of municipal “own source” funding, assumed to be primarily through borrowing, is forced to increase from R5.7 billion in 2005 to R9.1 billion in 2008. This may not be sustainable by many municipalities. PART II CHAPTER 5 175 Implications for MIG Subsidies The model indicates that the levels of MIG subsidies currently being made available are of the right order, with the predicted requirements for 2004/05 to 2007/08 being approximately R1 billion per year less than currently allocated from the national budget. This is based on the assumption that portions of the housing subsidy will continue to be used for infrastructure in accordance with current national policy. Implications for Housing Subsidies The model provides for housing subsidies to be used to cover internal infrastructure capital costs in urban areas, to the current extent of R1.8 billion and increasing to R4.0 billion in 2008/09. This is based on the assumption that R10 000 of each housing subsidy allocation made available to a poor household will be used for infrastructure (excluding electricity). Should this not be the case, and smaller amounts are allocated to infrastructure, then national grant allocations would need to increase proportionately. Policies surrounding housing delivery are currently being debated and the effect of any policy change will need to be evaluated in terms of the impact on municipal infrastructure capital requirements. In order to meet targets, the numbers of housing subsidies allocated and spent will need to increase from approximately 300 000 per year in 2005/06 to 600 000 per year in 2008/09. Implications for the Use of Municipalities Own Capital Finance Municipalities currently raise their own finance through both transfers from their operating accounts and borrowings. The extent to which a balance is achieved between the use of grant funding and “own source” funding (borrowing in particular) is a key consideration for the MIIF. The model estimate of R5.7 billion per year for “own source” funding in 2005/06 (refer Figure 58) is not inconsistent with what is currently being budgeted by municipalities, although there are questions as to whether municipalities are actually raising this amount annually. The model indicates that the level of “own source” funding will need to increase to R9.1 billion per year in 2008/09. The extent to which this is possible would need to be tested. National Treasury estimates that the total loan book of municipalities is currently about R20 billion. Treasury analysis indicates that it is feasible for municipal loans to increase to within the range of R56 to R128 billion. Based on the model estimates of “own source” funding, and assuming that 80 percent is derived from loans, the model projects that the total loan book of municipalities will increase to R63 billion in 2014/15. Assuming a real interest rate of 10 percent, interest payments will be required equivalent to 5.5 percent of operating revenue for the combined municipalities of South Africa. While this repayment schedule appears to be feasible as an aggregated figure, affordability by the different types of municipality will differ substantially. Total capital expenditure and the financing requirement predicted for each type of municipality is given in Table 54. Table 54: Predicted capital expenditure over 10 years for each type of municipality (2005/06 to 2014/15) Type Capex Capital finance (modelled) (R billion for 10-year programme) Housing Subsidies MIG Municipal own source A 45 352 13 500 11 230 20 622 B1 23 419 6 396 7 140 9 883 B2 13 813 2 925 4 695 6 193 B3 21 935 3 667 8 844 9 424 B4 36 884 2 552 14 109 20 223 141 403 29 030 46 018 66 346 Total model Table 54 indicates great variation in the predicted capital expenditure by each type of municipality, and the capital finance that each type of municipality will have to raise. In all municipalities, the extent of borrowing will depend largely on their individual capacity and ability to raise the necessary revenue. These trends are based on the same set of rules as the allocation of MIG grants to each service. It may well 176 THE DBSA INFRASTRUCTURE BAROMETER be possible for the metropolitan municipalities (Type A) to borrow funds of this magnitude. However, it is unlikely that municipalities in other categories (Type B) will be able to borrow funds at the levels indicated, especially the Type B4 municipalities. Operating Budget Implications The results of modelling for the operating account using the chosen scenario are summarised in Figures 60 and 61. Figure 60: Operating expenditure results for chosen scenario (constant 2003/04 prices) Figure 61: Predicted sources of revenue for chosen scenario (constant 2004/05 prices) Operating expenditure, in real terms, including capital charges and net of inflation, is shown to increase from R88 billion per year in 2004/05 to approximately R130 billion per year in 2013/14. This represents an average increase of 4.5 percent per year in real terms, or typically about 10 percent in nominal terms at current inflation rates. The dominance of electricity, including Eskom distribution activities, and “other services” (public services and GAPD) is evident. Although meeting national targets for addressing backlogs and providing service levels likely to be acceptable to communities, the infrastructure programme under the chosen scenario is shown to be non-viable. It is predicted that the operating revenue will be insufficient to meet operating expenditure, PART II CHAPTER 5 177 except in a few municipalities. It is clear therefore that other scenarios will need to be investigated in order to reduce operating expenditure. In addition, municipalities themselves should undertake the necessary infrastructure planning as part of their IDPs to determine their own affordability levels. This inability to balance municipal revenue with expenditure is not a new phenomenon, and illustrates the difficulty of providing moderate service levels to consumers linked with free basic service policies within affordability constraints. The situation regarding the nationally aggregated operating account for households is given in more detail in Figure 62. Figure 62: Operating account comparisons with detail of individual services (real terms, constant 2003/04) The following should be noted: • An increase in household spending from 2005 to 2013 • A shortfall in revenue for the chosen scenario • A high level of spending on GAPD and public services. It should be remembered that the aggregated national picture, as provided by the model, obscures the situation that will arise in the different municipalities, due to their vastly different income-raising capacity and infrastructure backlogs. Some municipalities may be faced with significantly higher levels of deficit under this scenario while others will fare better than the national aggregate. Conclusion The real problem in South Africa is not so much the availability of initial capital to fund the national municipal infrastructure programme, but rather the sustainability of the services provided. As described elsewhere many municipalities lack the technical and institutional capacity to plan for, implement and operate infrastructure services. Furthermore, the analysis indicates that municipalities should investigate reducing costs, providing service levels that are more appropriate to municipal and household ability to pay for them, and improving their ability to raise revenue. As a first step in attempting to close the gap, further scenarios with the different municipality types need to be tested, with the specific goal of discovering the gap between expenditure and revenue in the operating account. In urban areas, the ability to deliver housing represents a major constraint because much infrastructure delivery is linked to the provision of housing. There are serious constraints on the ability to provide welllocated, well-planned housing for the poor. These constraints relate mostly to the process of land purchase, planning, registration and transfer. Infrastructure targets will not be met unless the housing delivery process is improved dramatically. 178 THE DBSA INFRASTRUCTURE BAROMETER In many municipalities, particularly those serving rural areas, and especially Types C2 and B4 municipalities, there is insufficient capacity to manage the infrastructure provided. This relates primarily to the shortage of personnel with strategic planning, engineering and technical qualifications. There is an urgent need to encourage and support municipalities to engage in regular infrastructure investment planning and to develop affordable and sustainable service delivery programmes, particularly by matching the levels of service with affordability for both consumers and the municipality/service provider.A well designed infrastructure investment plan and asset management strategy should achieve a workable balance between an affordable capital programme and sustainable operating and maintenance expenditure. Infrastructure asset information is seriously lacking in many municipalities. A particular example is municipal roads. For asset management purposes, spending on municipal roads should be a major part of municipal expenditure. There is, however, little information available on road length and road condition, and the institutional responsibility for specific roads is often unclear. This situation makes it very difficult for DPLG to allocate MIG grants to municipalities to finance road construction and rehabilitation. The total national capital allocation of grant funding, as indicated in this report, appears to be at the right level, but the allocation to different types of municipality may need to be adjusted to their individual ability to raise own capital finance. The specific circumstances in each type of municipality require further investigation to ensure that national targets for removing backlogs can be met in all circumstances. In order to achieve national targets, the annual rate at which services are delivered needs to be carefully monitored. In order to improve the quality of information and reporting, municipalities should be assisted to enhance or develop easily-managed services backlog information systems, not only for their own IDP and performance management purposes, but also to facilitate the regular roll-out of that information to provincial and national levels. Proposals in respect of a national backlogs information system and municipal asset management are part of the current MIIF update exercise. PART II CHAPTER 5 179 Spotlight on ICT making a difference in the lives of poor communities This case study demonstrates how ICT can create opportunities for poor communities that have not previously been exposed to ICT. Hewlett-Packard (HP) South Africa, operating through business consortia, was instrumental in setting up two community projects which illustrate how the deployment of ICT infrastructure could serve poor communities and provide educational and economic opportunities to them. The HP i-Community projects were launched at the WSSD by President Mbeki and the HP Chief Executive in September 2002. Dikhatole is a community in Gauteng that experiences large unemployment and is lacking running water, electricity and basic housing. HP South Africa initiated a project into which basic computer, Internet and business skills coaching were injected. The Dikhatole Digital Village was established with more than 90 Internet-enabled workstations. The aim of the project is to improve living conditions of the community by connecting them with the rest of the world. Members of the community are empowered through skills training, such as computer literacy, CV writing, communications and presentation, and entrepreneurship. The target is to reach more than 1 000 unemployed youth and to provide them with skills to enhance employment possibilities. More than 500 women were trained to use the Internet for networking and support and in business start-up skills. Schools are equipped with computers and teachers and children are trained in basic computer use. Training in basic computer skills is extended to local government employees. In a second ICT infrastructure project by HP South Africa, the community of Mogalakwena, close to Mokopane in Limpopo Province, has been the beneficiary of a partnership between HP, the Limpopo Province and the Mogalakwena Municipality. Models for sustainable development are being developed, using ICT 180 THE DBSA INFRASTRUCTURE BAROMETER infrastructure, community engagement, education, capacity building and training, economic development, digital culture initiation and e-service delivery. Part of the infrastructure includes a remote satellite facility. The project is aimed at building municipal ICT capacity; kick-starting an innovative Least-Developed Villages initiative; transforming the project into a global model for a multi-purpose centre; establishing a centre of excellence programme through schools; and addressing the daily challenges faced by the community in a sustainable manner. Building municipal ICT capacity enhances municipal ICT infrastructure, builds staff ICT capacity, and improves service delivery to the public by optimising back- and front-office services and service access points. Multi-purpose centres are created at municipal level to build sustainable service solutions to the community. A major focus is communicating the massive potential that ICT holds in terms of improving government electronic service delivery. A demonstration room showcases innovations in e-service delivery from around the world that could be relevant for the municipality and its communities. A fully-fledged call centre has been introduced where call centre agents study and work at the same time. Innovative solutions are sought for least-developed villages which are defined by their lack of access to clean water, electricity and telecommunications. The sustainable livelihoods initiative has introduced a variety of ICT-enhanced solutions to meet the basic challenges of food security, water, sanitation, recycling, alternative energy, and access to and training on ICT (an example is smart cards to enable pre-payment of electricity). It can be seen that ICT infrastructure thus enables many other infrastructure activities. Progress at the Mogalakwena i-community was reviewed personally by President Mbeki in September 2003 and a series of specific objectives were defined. These included launching a project that addresses the daily challenges faced by the community in a sustainable manner and building municipal ICT capacity, amongst others in the “Sustainable Livelihoods” initiative, and also through communication and information-sharing. Schools in the HP i-Community are provided with ICT and open source software specialists, promoting a range of administrative, PC literacy, curricula and digital culture coursework. Open source software platforms represent low-cost and flexible solutions for application interfaces in Sepedi, Afrikaans and other local vernaculars, and are introduced to meet the specific needs of such an emerging economy. In conjunction with the CSIR, and endorsed by Internet entrepreneur and astronaut Mark Shuttleworth, an Open Source Centre was launched at the HP i-Community. The International Computer Driving Licence (ICDL) is recognised internationally as the benchmark for measuring end-user computer skills and is being presented in the community, including the world’s first ICDL training and testing centre for open source software. A community computer camp is run at multiple public venues in order to reach the students. This approach has contributed significantly to the total number of more than 3 000 residents who have been trained. An HP multi-user desktop solution has been developed to allow four people to work simultaneously and independently using a single computer. Each user has her/his own keyboard, monitor and mouse, and can use software applications, browse the Internet or send e-mails as if s/he was working on a stand-alone PC. The acceptance of a digital culture is enhanced by the introduction of multimedia equipment focusing on Internet and broadcast radio, audio-video recording and editing, web site design and digital photography. Projects include an initiative that provides soloists and/or groups of musicians, poets, writers and performers the opportunity to have their material recorded professionally and cost-effectively. Emerging artists can produce a CD or DVD of their performance which can then be used to market themselves. An alternative technical approach to the challenges of rural connectivity has indeed been developed. And today, the HP i-Community stands poised for a second Presidential Review. PART II CHAPTER 5 181 CHAPTER 6 Challenges for Municipal Infrastructure Service Delivery in Marginal Communities Introduction In 1994, the incoming democratic government embarked on transforming the country. In pursuing this goal, however, government was confronted with several serious challenges, one of which was the state of infrastructure and services available to the largest and poorest sector of the population, a socio-economic legacy of apartheid. The deficiencies in infrastructure development in South Africa are particularly pronounced in underdeveloped areas and marginalised communities, notably the historically black townships, informal settlements and rural areas. Hence, large numbers of poor people have to make do with basic or no municipal services. The government committed itself to removing infrastructure services backlogs by 2014, with the role of municipalities in providing these services being central to achieving this goal. Chapter 6 examines the reasons for the ongoing infrastructure services backlogs in marginal rural and urban communities, focusing on the challenges confronting municipalities in overcoming the backlogs, and in operating and maintaining the services. The chapter comprises four sections. Following this introduction, the first section shows where the marginal communities are and presents the services delivery issues relating to them. The second section presents first the overall social context of infrastructure requirements, and second, a review of the policy and legislative environment guiding infrastructure service delivery in the context of local government’s developmental role. The third section addresses the challenges for services delivery. These include the institutional and financial challenges confronting municipalities in delivering services and overcoming services backlogs in marginal communities, in particular the ability to finance both the cost of investing in service infrastructure and operating and maintaining service delivery. The final section draws conclusions. Similar to Chapters 4 and 5, this chapter draws on the findings of the 2001 Census and differentiates between “urban formal”, “urban informal”, “rural formal” (commercial farms) and “tribal areas” (“communal areas in former homelands”). It should be noted, however, that these areas do not fit neatly within either municipal boundaries or the A, B and C categories of municipalities (refer Chapter 5, Table 46). Services backlogs are presented as the number or proportion of households lacking basic levels of services. Marginal Communities and Services Delivery Three dimensions are used to explain the nature of marginalisation and its implications for services delivery: 1) service levels and backlogs, 2) household incomes, and 3) location of the community. Service Levels and Services Backlogs It is important to note that the extent of the services backlog depends on the definition of the service level. As an example, compare a “below basic” pit latrine with a “basic” ventilated improved pit latrine and the “full” services level of water-borne sanitation. In the RDP and subsequent government policy, and consequently in the Municipal Infrastructure Investment Framework (MIIF), a backlog is defined in terms of a service level less than that needed to ensure a household’s health and safety. Specific service levels are discussed in Chapters 4 and 5. Based on the 2001 Census, services backlogs are shown to be considerably greater in communal areas and urban informal settlements than in urban formal areas and commercial farm areas. As an example, 54 percent of households in communal areas and 38 percent of households in urban informal areas lack access to basic water. The comparable statistics for urban formal and commercial farm areas are 5 percent and 20 percent respectively. As a further example, 77 percent of households in communal areas and 69 percent of households in urban informal areas lack access to basic sanitation. This again is considerably worse than the 50 percent for urban formal areas and commercial farms. Similar differences are evident for solid waste collection and disposal (less relevant in rural areas) and roads and public transport. Individual service backlogs differ markedly among provinces and between and within urban and rural areas. For example, in the metros with the best-served population, the 2001 Census showed that 15 percent of households lack access to basic water and 22 percent lack access to basic sanitation. PART II CHAPTER 6 183 Household Incomes Table 55 shows that communal and urban informal areas have the highest proportion of low-income households. For the purpose of this report, the measure of low-income is taken as households with an annual income of less than R38 400 in 2001. This income is equivalent to R3 200 per household per month, this amount being the census household income category closest to the R3 500 upper limit for eligibility for a housing subsidy. It is striking that virtually the same proportion of households falls below R38 400 per annum in both communal and urban informal areas, 94 and 95 percent respectively. Table 55: Percentage of households per area type earning less than R38 400 per annum, 2001 Province Communal Urban informal Urban formal Commercial farms Eastern Cape 96 97 72 86 Free State 96 98 81 92 N/A 95 62 85 KwaZulu-Natal 95 95 61 92 Limpopo 93 93 67 93 Mpumalanga 94 95 71 91 North West 93 94 74 90 Northern Cape 97 95 76 85 N/A 96 54 80 94 95 65 89 Gauteng Western Cape South Africa Notes: • Communal areas refer to village settlements in the former homelands (or “tribal” areas in Census 2001). • Urban informal areas refer to informal settlements around cities. • Urban formal areas include townships, inner cities and suburbs. • Commercial farms are former non-homeland areas used for farming purposes and include areas around small towns (or “rural formal” in Census 2001). Source: 2001 Census, information provided by DBSA. There has been a change in the number of low-income households. Between 1996 and 2001, there was a 3.4 percent per annum decline in households with an income of less than R800 per month, but a 3.5 percent per annum increase in households with an income of less than R3 500 (Tomlinson et al, 2003). It is expected that the decline in households with an income of less than R800 per month is due to the availability of social grants. It is also expected that the increase in households with an income of less than R3 500 per month is due to a combination of a) the increase in numbers who no longer fall into the lowest income category and have shifted into the next lowest because of social grants, and b) the number of people who have lost their jobs due to increasing unemployment. There have been far-reaching structural changes in the economy, including the shift out of low-skilled and unskilled jobs, such as the loss of job opportunities in the farming, mining and manufacturing sectors. This change has immediate implications for services delivery in municipalities which are directly affected by the absorption of less skilled unemployed people. Location of Marginal Communities Table 56 indicates the location of marginal communities, which is closely linked to the low income patterns shown in Table 55. This suggests a direct correlation between marginal communities and the type of service delivery challenges that a municipality is likely to confront. The grey shaded areas in Table 56 indicate where there are the following challenges: • Across-the-board services backlogs • The number of households living under these backlog conditions constitute the large majority of the municipality’s population • There is extensive poverty, and • Institutional and financial capacities are highly constrained. Marginality is therefore linked with profound challenges for municipal services delivery. 184 THE DBSA INFRASTRUCTURE BAROMETER Table 56: Percentage of households by area type, 2001 Province Eastern Cape Free State Communal Commercial farms Total number of households 51 Urban informal 9 Urban formal 34 4 1 535 968 8 13 62 11 757 259 N/A 12 72 2 2 836 335 38 12 38 8 2 200 430 Limpopo 75 2 11 9 1 250 363 Mpumalanga 36 4 36 16 783 004 North West 44 6 35 10 219 981 1 4 68 22 977 949 N/A 10 78 9 1 208 982 28 9 50 8 11 770 271 Gauteng KwaZulu-Natal Northern Cape Western Cape South Africa Source: 2001 Census, information provided by DBSA. It is more difficult to generalise for the yellow shaded areas. Urban informal settlements are typically found on the outer edges of many small and large towns in rural areas, large municipalities (e.g. Msunduzi, the former Greater Pietermaritzburg) and metros (e.g. Johannesburg). These urban informal settlements all suffer from across-the-board services backlogs and are the sites of extensive poverty. However, the municipalities within which they are located differ in terms of the balance between economic activity, highand low-income households (the potential for cross-subsidy) and institutional and financial management capacity. Marginality may or may not be associated with the capacity to deliver services. In the case of the blue shaded areas, the number of households lacking basic services does not constitute a large proportion of the municipality’s population. Nonetheless, a large number of households are lowincome and there are significant financial and institutional challenges to services delivery. The unshaded areas include: • Communal areas with services backlogs and low household incomes, but which constitute a relatively small proportion of households in the province • Commercial farms and urban informal settlements where these conditions also apply, and • Urban formal settlements where services backlogs are least and where there is often potential for intrasector cross-subsidy. It is apparent that the linkages between marginality and challenges to services delivery in communal areas are quite different from those in urban informal settlements. Although government policies on delivery of infrastructure services take these differences into account, implementation and achievement of policy intent is nonetheless constrained by the social environment typical of marginal communities. Social Environment for Infrastructure Service Delivery Ridding the country of services backlogs by 2014 requires many interventions. A host of social limitations remains. These include a) the rapid increase in the number of households requiring infrastructure services, b) the increase in the number of low-income households that qualify for housing and services subsidies, c) the rate of increase of low-income households in specific areas, d) the consequences of HIV and AIDS, and e) the relationships between consumers, levels of service and affordability. Increase in the Number of Households Change in services backlogs is linked to the rate of increase in the number of households. South Africa’s population in the 1996 Census was reported to be 40 583 570 persons, and 44 819 318 persons in the 2001 Census. This is an increase of 2.09 percent per annum. The proportion of the population that was found to be urban was 53.7 percent in 1996 and 57.5 percent in 2001. In terms of services backlogs, however, the more significant data relates not to the increase in number of people but to the increase in number of households. Whereas the number of people indicates, say, the amount of water required (bulk and connector infrastructure), the number of households indicates the PART II CHAPTER 6 185 number of services connections required for dwellings (and other shelter arrangements). Services connections are generally provided, or are intended to be provided, by municipalities which are also responsible for operating and maintaining services delivery. Between 1996 and 2001, the number of households in South Africa increased from 9 077 402 to 11 770 270, an increase of 5.33 percent per annum. This is more than double the rate of population increase. The urban proportion of households was 59.9 percent in 1996 and 62.5 percent in 2001. The discrepancy between the urban proportion of households and the urban proportion of the country’s population is due to the smaller household size in urban areas. The change in household size accounts for the rapid increase in the number of households. Average household size was 4.47 persons in 1996 and 3.8 persons in 2001. If household size had remained constant, the increase in the number of households would have been about 1 million whereas the actual increase is about 2.7 million households. The rate of increase in the number of households is a critical issue for all policies associated with overcoming services backlogs. Changing Location of Low-Income Households Populations are not static and they grow, contract, move and change their composition in response to a myriad direct and indirect influences on individuals and household units. The 2001 Census showed net migration to the more urban provinces of Gauteng and Western Cape. More than 20 percent of the resident population of major metropolitan areas and some regional centres and smaller towns are new migrants. In general, new migrants reside in informal settlements and other overcrowded locations. Although the census did not reflect circulatory or seasonal migration, there is evidence to suggest continued linkages between urban and rural localities. This poses a challenge for road and transport infrastructure to provide efficient movement between the areas. Not surprisingly, certain cities and towns are growing very rapidly. Table 57 shows that the number of households in Gauteng is increasing at a rate of 7.59 percent per year. Johannesburg experienced an increase of 8.05 percent per annum in the number of households between 1996 and 2001. Both the provincial and Johannesburg’s growth rate are significantly larger than, say, the Eastern Cape and the Nelson Mandela Metro where the rates of increase in the number of households were 2.84 and 3.84 percent respectively. Table 57: Rate of increase in the number of households between 1996 and 2001 Province Eastern Cape Number of households Number of households % increase per annum in the 1996 2001 number of households 1 333 862 1 535 966 2.86 626 339 757 261 3.87 Gauteng 1 967 597 2 836 334 7.59 KwaZulu-Natal 1 665 299 2 200 429 5.73 Limpopo 984 457 1 250 363 4.9 Mpumalanga 605 110 783 003 5.29 North West 721 652 977 950 6.27 Northern Cape 187 596 219 981 3.24 Western Cape 985 490 1 208 983 4.17 9 077 402 11 770 270 5.33 Free State South Africa Source: Development Information Unit, DBSA (Base data: STATS SA) The challenges for Gauteng begin with the 366 506 structures in informal settlements (Department of Housing, 2005). Assuming that the increase in the number of households is disproportionately located in informal settlements, the task for the province’s three metros is to catch up with the existing demand for housing and services and then to remain ahead of the ever-increasing demand. However, there has also been a rapid increase in the number of households in other areas that lack 186 THE DBSA INFRASTRUCTURE BAROMETER the institutional and financial capacity found in Gauteng. Many rural areas where housing and municipal and social services are available and some large centres, such as Polokwane (former greater Pietersburg) and Mbombela (former greater Nelspruit), have also experienced a rapid increase in household numbers. Negative growth is largely found in the communal areas and the Northern Cape Province. Demographic shifts have implications for fiscal allocations and, important for the longer term, the approach to spatial development. The challenge is to decide where to target investment in order to achieve the best developmental outcome. In order to achieve this, it is critical to be able to identify such issues as areas of potential, concentrations of absolute poverty and migration “feeder” communities. Results from a DBSA migration study (1998-2000) and studies undertaken during the development of the National Spatial Development Perspective (1999-2002) suggest that access to infrastructure and public goods - long identified as a major force behind movement within cities - is now also a major factor in rural-urban migration decisions. In other words, migrants are attracted to areas which they believe will give them access to better infrastructure and public goods. The challenge in responding to these migration patterns is to determine the types of infrastructure required in both recipient areas and feeder areas. In arriving at such decisions, it is pertinent to bear in mind that most of those who migrate to or stay in recipient (mainly urban) areas are economically active, while those remaining in “feeder” (mainly rural) areas are mostly the young and the old. One challenge is therefore to provide infrastructure that will prepare the young to be more productive, whether in the original or the recipient area, and the old to be able to maintain a dignified life. Some initiatives are emerging that are already making a difference to the lives of poor communities (e.g. Information and Communications Technology) (refer to the Spotlight on ICT case study after Chapter 5). HIV and AIDS, Services Levels and the Ability to Pay for Services HIV and AIDS has been described as one of the greatest development challenges, largely as a result of the alarming increase and devastating impact of the pandemic on individuals, communities and society. There are indications, for example, that HIV and AIDS will impact, among others, on the following: • Demographic changes in the age and sex structure of the South African population, as adults from age 20 to 40, the most economically productive segment of the population, are hardest hit. • Changes in household composition, as the numbers of pensioner and orphan-headed households, as well as extended households, increase. • Changes in income, expenditure and savings, as caregivers divert resources from savings to healthcare, funeral costs and the sale of assets for survival. • Changes in the demand for various services as households try to cope with the impact of HIV and AIDS. Demands for services such as electricity, health, water, sanitation and housing may increase while the ability to pay for the delivery and maintenance of such services decreases. There is an increasing demand for municipal services such as cemeteries. • Increasing poverty levels, as there are indications that poverty provides the context for the HIV and AIDS pandemic, which exacerbates poverty. The poorest households are therefore more likely to feel the pandemic’s greatest impact, resulting in increases in the extent, depth and distribution of poverty. All these factors will lead to the reduced ability of communities to pay for municipal services. HIV and AIDS also have the potential to exacerbate the situation by impacting negatively on municipal capability to deliver sustainable services, first, as municipal personnel are infected or affected by HIV and AIDS, and second, in municipal ability to respond to the increasing number of HIV and AIDS-related needs. While all spheres of government are likely to experience the negative impact of the pandemic, local government seems likely to be most affected, largely because it is closest to local communities. Municipalities are primarily responsible for the delivery of essential services to local communities, such as water, sanitation, housing, health, electricity and cemeteries. In addition, the payment of services charges, rates and taxes for service delivery contributes towards the financial sustainability of municipalities. Developments in the South African legislative and constitutional framework have resulted in the mandate for the HIV and AIDS response by local government being indirectly defined and largely unfunded. Further, local government has only become involved in HIV and AIDS policies and programmes at a late stage, largely as a result of its long-term transformation, the demarcation process and various other factors such as PART II CHAPTER 6 187 capacity constraints. This has serious implications for the responses that municipalities can mount against the pandemic. Those municipalities not having the potential for cross-subsidisation may be unable to finance the additional services that will be required to combat the impact of HIV and AIDS. Arrangements to establish special infrastructures such as Voluntary Counselling and Testing Centres may also be required, but such initiatives could be affected by the relatively limited mandate of local government in this regard. As local government has the closest interaction with people on the ground, it is best positioned to prevent and mitigate the impact of HIV and AIDS. Despite its late response to the pandemic, there is mounting evidence that local government is increasing its political support for HIV and AIDS policies and programmes. Various programmes have thus been introduced at local government level to help shape effective responses to HIV and AIDS (van Rensburg et al, 2002). Consumers, Levels of Service and Affordability in Marginal Communities The heterogeneity of consumers of infrastructure services has a marked influence on prospects for sustaining the provision of services. Many consumers lack information and knowledge about the services and support that they can obtain from infrastructure providers. Recent protests suggest that there is insufficient interaction between consumers and municipal service providers. The Integrated Development Plan (IDP) is supposed to encourage broader participation by potential beneficiaries but, in many instances, only a few people participate in the infrastructure service plan that informs the IDP. Many instances of top-down decisionmaking have caused serious problems, such as those described in Chapters 4 and 5. For each infrastructure service provided by municipalities or their agents, a range of Level of Service (LOS) is available from basic through to full, or high-level. Each has an associated capital, operations and maintenance cost. All too frequently, decisions are made on the availability of sufficient capital funds, secured through grants and perhaps supplemented by loans and customer contributions, with insufficient attention being paid to the funding of recurrent costs. Any shortfall in income for recurrent costs can result in the breakdown of the service, rapid deterioration of the infrastructure assets, and even environmental degradation and health hazards. The choice of LOS must be appropriate to the social and institutional environment in which it is placed. The challenge is to determine which services are seen as priorities by the potential consumers and whether the selected services will actually meet the needs of the people. As an example, should a water supply system in a rural area provide for the needs of livestock and vegetable growing? What LOS is affordable? Who will operate and maintain the service and will they have access to the technical skills that might be required? What services can be provided in informal settlements when there is no security of tenure? All such issues should influence the choice of an appropriate LOS. It is clear that the social dynamics of marginal communities are complex. Nonetheless, municipalities are required to deliver most of the infrastructure services, and policy guidelines are available to enable effective delivery. The Policy and Legislative Environment Developmental Local Government and the Role of Municipalities The need for local government to play a developmental role was pronounced in the RDP as early as 1994, when government committed itself to meeting the basic needs of all South Africans and agreed that this would be achieved through cooperative governance. Included under basic needs were the delivery of water and sanitation, waste removal, energy and housing. The 1996 Constitution of the Republic of South Africa called for developmental local government to: • Provide democratic and accountable government for local communities • Ensure the provision of services to communities in a sustainable manner • Promote social and economic development • Promote a safe and healthy environment, and • Encourage the involvement of communities in the matters of local government. These developmental outcomes were further articulated in the White Paper on Local Government (1998) 188 THE DBSA INFRASTRUCTURE BAROMETER which established the role and responsibilities for local government in providing household infrastructure and services; the creation of liveable, integrated cities, towns and rural areas; and the stimulation of local economic development through employment and jobs as well as special economic services. It was envisaged that these activities would be put into operation by a variety of municipal entities constituting the system and structure of local government. Municipal Legislation for Infrastructure and Services A municipality has the right to govern, on its own initiative, the local government affairs of its community, subject to national and provincial legislation (Section 151 (3) of the Constitution). A range of legislation covering local government issues, with subsequent amendments, guides municipalities’ operations. • The Municipal Demarcation Act (1998) determines municipal boundaries. It leaves no part of South Africa outside the jurisdiction of a municipality. Unlike the past, there is therefore parity and equity in entitlement to services. • The Municipal Structures Act No. 117 (1998), in accordance with Section 155 of the Constitution, provides for the establishment of three categories of municipality and for the allocation of powers and functions to and between these categories. The powers and functions of the three levels have become more variable and have created a plethora of challenges to certain municipalities. A case study for a sub-category B2/B3 municipality is described in Box 13. Examples are also drawn from the B3/B4 municipalities, which Gibson (2004) refers to as the “forgotten municipalities”. • The Municipal Systems Act (Act No 32 of 2000) provides for systems of internal operations of municipalities to address the objects of local government. The implications for infrastructure are provided in Chapter 8 of the Act, addressing municipal services, as well as in Chapters 4 and 5 addressing community participation and integrated development planning. • Other legislation includes the Municipal Finance Management Act (2003) and Property Rates Act (2004), which provide guidance to improve the management of finances and property revenues. Policy Instruments for Infrastructure and Service Delivery to Marginal Communities Box 13: A case of a typical B2/B3 municipality This chapter is supplemented by a case study of a typical B2/B3 municipality (refer Table 46 for the definition of categories). It is a study of an existing municipality but, for reasons of confidentiality, the name and some of the circumstances have been changed. The study is spread through Chapter 6 in Boxes 13, 14, 16 and 17. Box 13 (this box) provides a general overview of the municipality. Box 13 presents the institutional challenges and Box 16 the financial challenges. Box 17 suggests interventions required to meet these typical challenges. The municipality is located in a predominantly rural province and comprises two urban centres and more than 50 rural villages. The total area of the municipality is about 3 000 square kilometres. The former municipal manager has been suspended on some 100 counts of fraud. The municipality has serious financial problems which have resulted in its inability to pay salaries, medical aid and pension contributions, as well as defaulting on creditors. The total amount currently owed to creditors is in excess of R35 million. Given the parlous institutional and financial state of the municipality, provincial government has appointed an administrator in terms of Section 139 of the Constitution. Despite housing a large number of government administratitive functions, the municipality faces a range of challenges. The total Gross Geographical Product for one of its magisterial districts in 1999 was estimated to be R2.5 billion. The community and social services sector (including government) accounted for more than 52 percent of economic production in the district. Other notable economic sectors were the financial, insurance, real estate and business sectors (12.1 percent), the wholesale and retail trade sectors (11 percent), transport, storage and communication sectors (7.8 percent) and the manufacturing sector (6.6 percent). According to the 2001 Census, the total population for the area was more than 250 000 people. The unemployment rate is estimated to be about 37 percent. A high concentration of professionals resides in the area. In the context of the legislation and cooperative governance, municipalities have been expected to accelerate the provision of infrastructure and services to marginal communities. Such efforts are guided by various policy instruments. • The Municipal Infrastructure Investment Framework (MIIF) proposes appropriate levels of service in order to achieve affordable infrastructure investment plans within the financial resources of each municipality. • The Municipal Infrastructure Grant (MIG) consolidates a number of separate sectoral grants under one administration. Sectoral components to the MIG do remain and they vary according to actual service deficiencies, but municipalities can prioritise the use of MIG to fit their own roll-out plans. Government is committed to increase MIG allocations each year for the foreseeable future. • The Free Basic Services Policy, entitling all households to an agreed level of free basic services, was introduced following the 2000 local government elections. The running costs of free basic services are PART II CHAPTER 6 189 Box 14: Institutional capacity and governance of a typical B2/B3 municipality Organisational structure and functioning The suspension of the municipal manager has created a divisive atmosphere within the municipality. Senior managers are not cooperative and many still pay allegiance to the suspended manager. Management meetings have not been held for several months. There is a lack of communication within the directorates as well as between senior management and lower levels of staff. The organisational structure is expensive and the salary bill is more than 53 percent of total operational expenditure. Lack of financial management and skills in the Financial Services Department is a source of concern; and the head of this department is also currently on suspension. Other key positions within the Finance Directorate that are vacant include Head of Income, Accountant Billing, Accountant Debt Collection, Accountant Property Assessment Rates and Ledgers. Governance None of the portfolio committees has terms of reference. There is no delegation of authority in the municipality as the policy adopted by Council has not been implemented and all delegations of authority were withdrawn after the municipal manager was suspended. All decision-making is now vested in the council and executive mayor. There is a lack of trust between the chairpersons of the functional responsibility portfolio committees and officials. Attendance by members of the portfolio committees at committee meetings is generally poor. The lack of delegation has had a negative impact on municipal operations, particularly with regard to decision-making. In addition, there is no proper interaction between politicians and officials within Council, leading to a number of areas of conflict. There is also a lack of bylaws to enforce the policy directives approved by Council. Although most department heads had signed performance agreements, all agreements have had to be reviewed. Human resources management The municipality has no human resource policies and no human resource development strategies in place. The Human Resource Directorate is currently under-staffed and there is a general lack of direction and purpose and no commitment to the overall mission and vision of the municipality. The lack of commitment by senior staff members has led to low morale and lack of motivation among lower staff levels. Supervision, monitoring and control are lacking. Consequently, employees behave as they please with an overall adverse effect on productivity and municipal delivery. Change management workshops are poorly attended by senior managers and the management structure is too weak to drive transformation within the institution. intended to be met by a municipality’s “equitable share” of national revenue, augmented by cross-subsidies and other local taxes levied where necessary and possible. Free basic services are defined as: • Water: 6 kilolitres per household per month • Electricity: 50 kWh per household per month • Rubbish removal: Own refuse dump in rural areas, a communal refuse dump that is well-managed by the community, and collection at least weekly in urban areas. • The Housing Subsidy to lower income groups is rendered by a housing programme offering both greenfield and new houses, as well as upgrading opportunities. The basic subsidy is currently R22 800 but there are a variety of permutations depending on specific conditions. A key current point of contention is whether the housing subsidy should be applied solely to the house superstructure and not to the superstructure plus residential infrastructure as is the existing practice. Within this policy framework, municipalities are expected to provide infrastructure services to marginal communities. However, this has not always resulted in an increased rate of delivery as municipalities face a range of institutional and financial challenges. These are described in the following sections. Institutional Challenges to Service Delivery There are many kinds of institutional challenge to service delivery. The first concerns the link between marginal communities and the institutional and financial capacity of municipalities. Second, the link between the delivery of services and housing means that other infrastructure services cannot be delivered if housing is not delivered. Third, while some infrastructure can be provided to informal settlements, the settlements cannot receive other municipal services because the areas are not properly planned. Capacity Needed to Deliver Infrastructure The Municipal Systems Act requires municipalities to prepare Integrated Development Plans (IDP) in cooperation with their communities so that inclusive future development requirements can be projected. The process of developing IDPs has highlighted serious institutional, capacity and capability constraints faced by municipalities in their servicing of marginal communities. This problem is compounded by the revised mandate introduced through the National Department of Housing’s amended policy of Breaking New Ground which will require “accredited municipalities” to prepare Housing and Municipal Integrated Development Plans as part of the process of gaining access to housing programme funding. Further, the capacity of most district and local municipalities to function as authorities and providers of energy, water, sanitation, transport and other municipal services is very limited. The 2003 Municipal Demarcation Board’s capacity assessment of district and local municipalities revealed a range of institutional capacity challenges confronting most district and local municipalities. The following capacity constraints have been identified as 190 THE DBSA INFRASTRUCTURE BAROMETER hampering the provision of services at the local sphere of government: • Sector planning (planning for service delivery and maintenance) • Water • Roads and transport • Electricity • Other economic and municipal infrastructures • Financial management • Project management • Procurement and supply chain management • Technical and engineering services • Performance management systems • Leadership and management • Governance and decision-making (King II Report for the public sector). For historical reasons, public utilities (e.g. Water Boards, Eskom) are directly involved in the provision of infrastructure and services delivery for some municipalities. In the past, local authorities operated only in urban centres. This situation continues because many of the new municipalities responsible for rural areas still do not have the capacity to provide and regulate these services. A major challenge still facing most municipalities is the allocation of existing limited capacity between economic and other municipal services. The introduction of the Regional Electricity Distributors (RED) indicates that Government is taking the efficient provision of infrastructure, such as electricity, very seriously. There are numerous debates both for and against the introduction of REDs, and there is also ongoing debate concerning the creation of a water distribution model similar to the REDs. The introduction of these institutional reforms will undoubtedly have an impact on municipalities. The challenge is how to manage the impact in such a way that it does not negatively affect services delivery. Institutional Capacity and Governance The most obvious challenge is institutional capacity and good governance, with a serious shortage of skills, including managers, engineers, technicians and artisans. Most municipalities struggle to recruit and retain skilled personnel who can often secure better paid employment in the private sector or other public sector institutions. Municipalities thus face substantial responsibilities for services delivery with relatively limited capacity and resources (Manning, 2003). The problems typified by the “case study municipality”, as featured throughout this chapter, tend to occur in most municipalities, with the exception of A and B1 municipalities. Conditions in the B4 municipalities may, however, be worse than the case study. Gibson’s (2004) “forgotten municipalities” are worthy of attention and are characterised by: • No major town in the municipal area • No significant industrial or commercial activity • Large areas of communal land • Many rural households • High levels of poverty • No previous municipal organisation to grow from. At least 90 municipalities are typified by this description in various ways. They constitute nearly 50 percent of B3 and B4 municipalities and almost one third of all municipalities. With such capacity constraints, it is clear that major difficulties will be experienced in removing the services backlog by 2014. Infrastructure Asset Management and Efficiency Stated in simple terms, infrastructure asset management is a process to acquire or create, operate, maintain, replace and dispose of assets cost effectively so that delivery of services can be sustained. In South Africa, large annual capital expenditure results in an increasing number people enjoying basic (and other) services. Unfortunately, this expansion has run ahead of the capacity to finance, maintain and manage this development. The resulting problem can be found countrywide – capital works and infrastructure are falling into disrepair PART II CHAPTER 6 191 and collapsing, be they waste water plants, water purification works or municipal public services. Many local authorities undertake little asset management and do not budget adequately for asset maintenance, rehabilitation and replacement. The result is that the quality of service provision to beneficiary communities is deteriorating. The deterioration is not only evident in smaller municipalities. There is, for example, a growing body of evidence from Johannesburg regarding the serious impact that electricity outages are having on the well-being of the people and economy of the city. In other towns, there is evidence of a direct link between growing civic unrest and the deterioration of service delivery. This spiral into neglect and decline is clearly serious for sustainability in general. People say “no service, no pay”, but if there is no revenue, a municipality’s ability to manoeuvre is severely reduced in respect to initiating and undertaking improvements to the infrastructure networks and systems. Poor infrastructure maintenance impacts negatively on both financial sustainability and productivity, and thus on economic output and overall socio-economic well-being. In short, there is a direct link between sound, well-maintained infrastructure assets, the services they deliver and assuring economic efficiency and sustainable growth. Municipalities Servicing Marginal Communities Four types of area were identified earlier in this chapter, based on Table 55 and in an attempt to define marginal groups. These areas are not necessarily consistent with the municipality categories and subcategories. In reference to Table 56: • In the grey shaded areas, there will generally be more communal areas in B4 municipalities • In the blue shaded areas, there will be less urban formal population in sub-category B4 than in sub-category B3, and • In the yellow shaded areas, most of the urban informal settlement households are found in category A municipalities. It is readily accepted that, in general and with exceptions, institutional and financial capacity declines from A to B4 municipalities. It is also accepted that government attention, whether intentionally or because of “unintended consequences”, is focused largely on cities (A and B1) because they are the economic base of the country, contain at least one half of the country’s population and, arguably, are where there is most poverty (Atkinson, in publication). It is not surprising, therefore, that Gibson (2004) should refer to B3 and B4 municipalities - those with no major towns - as the “forgotten municipalities”. The ability to address the needs of households living in marginal communities, mainly communal areas and informal settlements, will differ according to the category and sub-category of municipality. In practice, these differences are largely ignored within the policy environment. Financial Challenges There are many dimensions to the financial challenge for service delivery to marginalised communities. In this section, two issues are addressed, the first concerning cost recovery (low household income and the ability and willingness to pay for services) and the second relating to finance and risk. Difficulties of Cost Recovery from Consumers in Marginal Communities Sustainable and reliable ongoing services delivery requires sufficient funds to meet operating and maintenance costs. Income may also be required to service loans for capital costs. Given the levels of poverty in marginalised communities, many consumers of infrastructure services are seriously constrained in what they can afford to pay. As a result, government has made significant budgetary provision to subsidise basic services in a way that an agreed minimum of services is available free to poor consumers. The challenge at the service delivery level, and for municipalities that are responsible for integrated service delivery, is in achieving a balance between meeting the needs of the poor and securing sufficient income to ensure sustainable services delivery. As previously discussed, this balance is, in part, related to the appropriate choice of LOS. It also depends on functional subsidy and tariff policies together with accurate tariff setting to achieve the required income. In South Africa, affordability continues to be a blend of consumers’ ability-to-pay, as related to income levels, other calls on expenditure, willingness-to-pay based more on perceptions of the degree to which the service is valued (at the LOS provided), political disposition toward the authorities, and a perception of the 192 THE DBSA INFRASTRUCTURE BAROMETER penalties for non-payment. A range of challenges emanates from this scenario. First, consumers need to be consulted on the choice and cost of LOS, informed of their rights (such as a free basic amount) and responsibilities, and helped to manage their consumption. Once that has been undertaken, municipalities then need to apply strict credit control. Second, the design of subsidy and tariff structures must be responsive to the needs of the poor, but at the same time assure sufficient income for the ongoing operation of the services. Third, service providers need to differentiate between those who cannot pay and those who will not pay, applying sanctions to the latter. Fourth, tariff structures and measurement technologies need to encourage and assist people to manage their consumption of services, thereby limiting their liabilities and contributing to resource conservation. The use of the “equitable share” of national revenue to support the provision of basic services to the poor is highly desirable, but there is always a danger of large subsidies negatively influencing the behaviour of service providers. Subsidy and tariff design needs to retain the link between the customer and the service provider. If a service provider relies more on recurrent subsidies from government than on income from customers, it is likely to be less concerned about rendering a good service to customers. Where this happens, there is a strong case for instituting consumer subsidies (e.g. a voucher system) to encourage service providers to pay more attention to the needs of their customers. Finally, the need for successful cost recovery through revenue management cannot be sufficiently emphasised. Apart from the advantages of improved revenue management to operations and maintenance budgeting, revenue management will be one of the first considerations to be examined by prospective providers of loan finance to support new capital expenditure. Finance and Risk If infrastructure services provision is to be sustainable, careful attention should be given to the raising and managing of finance (refer Chapter 5). Capital expenditure is typically funded through a) surpluses generated by the municipality or service provider, b) government grants such as the Municipal Infrastructure Grant (MIG), and c) raising loans on the capital market. In the poorer municipalities, the MIG and housing subsidies may be the only sources of finance. However, many municipalities struggle to access the MIG because they are required to have both an IDP and a business plan for implementing and operating the proposed infrastructure. In particular, the IDP should not be considered complete unless it includes a comprehensive and realistic infrastructure investment plan showing that the municipality and its consumers can afford the proposed PART II CHAPTER 6 Box 15: Challenges to generating revenue The primary financial challenge facing municipalities is to generate sufficient income to support the operations of the municipality. The major operational responsibilities for which income must be generated are: • Electricity. Many of the larger municipalities generate considerable income from this source. In our “forgotten municipalities”, electricity is often supplied direct from Eskom on a pre-payment system. It is difficult to understand how a new municipality could claim any of this income considering that it has provided no infrastructure and plays no part in the service provision or payment collection processes. The challenge is to ensure that the introduction of the REDs does not weaken the ability of municipalities to generate income. • Rates and levies. The policy that rates do not apply to properties with a value of less than R15 000 exempts a considerable number of households from contributing to rural-based municipalities. In addition, the low incidence of industrial and commercial properties restricts the municipality’s ability to collect sufficient rates and levies from these sources to cover the shortfall. • Water. 1) Where DWAF is, or recently has been, the de facto water services provider, the water operating subsidy exceeds the allocation from “equitable share”. Although this is not reflected in municipal budgets, it is a municipal responsibility and will become part of its expenditure and income once the current transfer process is complete. The planned reduction of this subsidy over the next seven years without any commitment, at this stage, for it to be replaced by any other form of funding, presents a major cause for concern. 2) It is important that a municipality that is also a water services authority implements appropriate arrangements for the provision of the service as well as for ensuring that those who are responsible for payment receive correct monthly bills and statements and have credit control actions taken against them in the event of non-payment. This approach implies that every house connection must either be metered or fitted with a flow restrictor device, or that the household must fetch water from an off-site supply. The challenge is how municipalities can increase their income flow from this source. • Sanitation. The cost of water-borne sewerage is high, both to the municipality and to the customer. This includes the cost of water used, and is estimated at a minimum of R100 per month per house). The installation of such facilities can only be financially justified when affordable. Most rural and peri-urban areas are therefore likely to be served by VIPs, chemical toilets or septic and conservancy tanks, none of which generate significant income for the municipality. • Refuse removal. Communities generally accept the need for this service and the need for it to be paid for. It is, however, difficult to enforce this payment, particularly as the level of income that can be generated will always be threatened by the area’s poverty. Source: Gibson, 2004 193 Box 16: Financial management challenges of a typical B2/B3 municipality Financial management The municipality has recently managed to prepare financial statements with the help of consultants. Balance sheet figures for 30 June 2003 are now available. Financial management within the municipality is very poor. The Head Office of the Financial Services Department is short of financial management skills and experience. Although an Acting Finance Director has been appointed, key positions in the Finance Directorate are still vacant - Head of Income, Accountant Debt Collection, Accountant Property and Assessment Rates and Ledgers. Most financial policies are inadequate or nonexistent and the municipality requires assistance with treasury activities. The municipal billing systems are not adequate because of the lack of IT resources. A second major issue is that the operational budget is not linked to the IDP, and the budget is not cash funded as there is poor budgetary control. Expenditure is still made against anticipated income and not actual income received. The ratio of salaries to total income declined in 2004, but remains much higher than the acceptable norm. Municipal revenue The major sources of the municipality’s revenue are assessment rates, water sales and government contributions. The electricity supply is provided by Eskom and thus no surplus revenue is generated from this source. Ideally, a significant proportion of the municipality’s revenue should be from trading activities such as water, sewage and refuse collection. However, sewage and refuse collection only contribute about 15 percent of municipal revenue and revenue from water supply is insufficient because water losses reached a high level in 2003. The municipality tends to depend more on government contributions than on revenue from own sources. Credit control The municipality previously had no debt or credit control policies. With the assistance of consultants, the revenue base is being expanded, including the implementation of a credit control policy. The payment level for services is currently 75 percent. The recovery of arrears, however, remains a major problem, with the bulk of this amount being owed by provincial government departments. The Council has now realised that part of this amount is not recoverable as consumers have proved that they were overcharged. It is estimated that 50 percent of the debt is recoverable, with the balance to be written off. Assets and asset management Although provision has been made in the 2005 budget for repairs and maintenance, most of the assets are not well maintained because there is no cash budget. Further, the municipality has no investments which can be liquidated to supplement income. Cross-subsidies and sustainability of the service The sustainability of the service is often strongly dependent on the amount of cross-subsidy that can be generated. This is achieved by charging higher-income households and non-residential consumers at above cost and applying the surplus to fund services to the poor. There are limitations to this practice, with some municipalities only having a few high income consumers in their jurisdiction. Moreover, frequent hikes in tariffs for high-income consumers can result in unintended consequences. 194 infrastructure. There is thus widespread need for basic planning, budgeting and project management skills within those municipalities that are responsible for serving the poorest and most marginalised communities. It is hoped that “Project Consolidate” will address these needs in the least capacitated municipalities, but it is still too early to assess its effectiveness. Municipalities with strong balance sheets are able to approach financial institutions to raise capital for infrastructure investment. Potential lenders routinely scrutinise and take a view on a municipality’s creditworthiness in terms of its overall financial health, its revenue performance and the risks associated with servicing the loan. These risks include financial aspects, such as a change in revenue or subsidy streams, institutional aspects such as the loss of senior management or the failure of administrative systems, and technical risks such as inappropriate choice of technology or poor operations and maintenance. If there is any probability of a particular risk occurring, and if the consequences are likely to be serious, then risk mitigation measures, such as loan conditions with builtin safeguards to reduce the likelihood of the problem occurring or some form of collateral or insurance, would be introduced into the loan package. There is growing recognition internationally that efficiency in services delivery can be enhanced through involvement of the private sector, although this view is less supported in South Africa. A variety of Public Private Partnership (PPP) models are available to assist service providers. These range from simple out-sourcing of activities such as meterreading, billing and credit control, through to management contracts and long-term concessions. Outsourcing can improve revenue performance. Management contracts can improve technical and administrative performance. Concessions enable the private sector to raise finance for an efficient capital investment programme, underwritten by the operator’s own equity. South African government decisionmakers should maintain an open mind with regard to private sector participation but, in order to achieve the potential benefits, they should exercise control in the context of clearly-defined roles and responsibilities. In the same way, partnerships within the public sector (PPP) also require a similar degree of control. THE DBSA INFRASTRUCTURE BAROMETER Conclusion This chapter has examined the reasons for the ongoing services backlogs among marginal rural and urban communities, and considered the challenges confronting municipalities in overcoming these backlogs, and in operating and maintaining the related services. The circumstances of marginal communities vary considerably and impose different services delivery challenges on municipalities. But even though the policy and regulatory environment is comprehensive, it does not often consider differences between marginal communities. In the same vein, while identifying some of the differences between communities and their circumstances, it was not possible to draw a direct link between specific service delivery challenges and the different types of marginal community. The line of reasoning thus focused on challenges to service delivery in general without always trying to make the connection to marginal communities. However, it is clear that marginal communities create a more complex situation for providing infrastructure services. It is concluded that the infrastructure requirements of marginal communities are extensive and diverse, and that reducing the backlogs is made complex by the communities’ fragile social and economic setting. In addition, most of the municipalities responsible for such communities are seriously hampered by both institutional and financial capacity constraints. In the light of this situation, several external interventions have been forthcoming. Of particular note is that government, cognisant of the institutional capacity challenges that local authorities face, instituted “Project Consolidate” in 2004. This project provides handson support to local authorities through frequent and sometimes full time technical assistance by experienced practitioners. A substantial number of municipalities have been identified as beneficiaries of this programme. In addition, the DBSA has instituted steps to address the challenges faced by the typical B2/B3 municipality featured in this chapter (refer Box 17), and similar approaches are used by the DBSA in dealing with clients who have trouble in meeting debt servicing obligations. PART II CHAPTER 6 Box 17: Some interventions for a typical B2/B3 municipality The challenges confronting this municipality are a result of local government amalgamation, institutional transformation and its own particular circumstances. Following the appointment of an administrator by the province, the municipality will be required to implement various measures to sustain its operations. The major focus will be directed towards the rationalisation of staff, improving the functionality of the treasury department and adjusting tariffs. Based on an analysis of the broad capacity-building intervention plans to be undertaken by DBSA, the DBSA will target its interventions (with support from the Development Fund) on: • Management and efficiency of the meter reading process • Assistance with collection of outstanding debts from large debtors • Customer database management • Training of credit control staff • Leadership training of both executive management and council • Development of maintenance plans, roads and stormwater plans and environmental plans • Information technology • Explore placement of graduates in municipalities. The financial interventions pertain to two DBSA loans; these should be consolidated and the total book debt rescheduled over an agreed term. In addition, the DBSA plans to appoint a consultant to assist the municipality with debt collection. Long term interventions to be implemented with the assistance of the Development Fund include: • Appointment of consultants to assist the municipality with upgrading its treasury activities • Providing assistance to upgrade the municipality’s IT resources. 195 Part II: Conclusion Infrastructure provision is a means to an end rather than an end in itself. The introduction to this report stated that good infrastructure is essential for growth and development, and that it can contribute to the eradication of poverty. However, both depend on the institutional and financial capacity to roll out and manage infrastructure in step with demand. They must also ensure that public investment reaches poor people with the right mix of services to provide sustained improvement in their quality of life and to contribute to their economic empowerment. Part II of the report focused on access to municipal infrastructure services in general, and access by the poor in particular. It reviews the available data, examines projections for infrastructure investment and identifies many of the challenges of improving access, especially for the poor and marginalised communities. These challenges are grouped into three areas: financial, social and institutional issues. South Africa has, without doubt, made great strides in addressing the infrastructure dimensions of the socio-economic legacy of apartheid. As described in Chapter 4, statistics vary between sources but the general picture is overwhelmingly positive, as indicated by the changes recorded between the 1996 and 2001 censuses. National budget allocations have been consistently increased and backlogs are being rapidly reduced, although some concern has been expressed over the sustainability of the municipal infrastructure currently being installed. It is important to note that growth and development depend not so much on the rapid roll-out of infrastructure itself, but rather on the sustainable delivery of the services which that infrastructure makes possible. The review of the infrastructure coverage statistics, which include two successive censuses and references to other sources of data, highlights problems of definition, interpretation and methodological incompatibility. It is hoped that all stakeholders will make a concerted effort to resolve these problems when national statistics continue to be gathered into the future. In the meantime, the baseline data used in the financial modelling for the Municipal Infrastructure Investment Framework (MIIF) represent an approximate consensus position on infrastructure coverage and backlogs reached through consultation with government departments. The coverage statistics also tell us much about the massive variation within the country. As an example, in 2001, nearly 68 percent of Western Cape Province households had an inhouse water connection, as compared with only 10 percent in Limpopo Province. In response to these infrastructure backlogs, government has committed itself to an ambitious investment programme with specific targets and timeframes for water supply, sanitation and electricity. Chapter 5 reported the interim results of the financial modelling for the proposed roll-out programme. This study was undertaken jointly by the DPLG in partnership with the DBSA as part of a review of the MIIF. This work aims to inform future budgetary allocations for the Municipal Infrastructure Grant (MIG) and the “equitable share” of national revenue allocated to the municipal sphere. It will also inform government policy and municipal decisions on levels of service (LOS) to be provided. The discipline of financial modelling raises a number of important issues on which we comment below. The first issue relates to input data. Although acceptable baseline data was obtained through broad consultation, this was simply a snapshot. It highlights the need for municipalities to institute systems to ensure that coverage data is kept up-to-date in order to facilitate their own planning processes. There is also a dearth of reliable information on the true costs of installing and running infrastructure services. It is hoped that implementation of the Municipal Finance Management Act (MFMA) will lead to ringfenced accounting of the various municipal services in order to provide accurate infrastructure costs. The availability of true costs in a municipality will inform budget decisions, LOS decisions and the setting of tariffs to avoid unintended distortions. Secondly, it is clear that most municipalities face large challenges in providing new infrastructure to address backlogs, and in operating and maintaining the services provided by that infrastructure. The challenge is also that of providing acceptable and affordable services to consumers of municipal services, especially where a large proportion of the consumers are poor. Both the MIG and “equitable share” provide substantial financial support but, in most instances, these must be supplemented with municipal own sources, borrowing for capital expenditure, and cross-subsidies from richer consumers to pay for operating expenses. Table 46 gives a useful typology of municipalities (other details are provided in Tables 10 and 11), indicating the wide variation in key characteristics influencing municipal ability to address the service delivery challenge. Financial modelling of municipal types with widely differing average revenue per household demonstrates that own sources, borrowing and cross-subsidies will be difficult for many 196 THE DBSA INFRASTRUCTURE BAROMETER municipalities, and particularly for the smaller and more rural municipality. The scenario incorporating government’s current targets was modelled in detail. It shows a pronounced investment peak in the middle part of the ten year scenario, largely due to the accelerated water supply and sanitation programmes. This will require a significant increase in municipal borrowing which is theoretically feasible but may prove unachievable for many smaller and rural municipalities and for those with a higher proportion of poor communities associated with limited economic activity. The financial modelling concludes that the proposed MIG budget allocations are adequate for at least the next three years, but that there is a risk of insufficient funding if a policy change for housing subsidies excludes infrastructure costs. Further, the current scenario also depends on acceleration of the housing subsidy programme (including infrastructure) whereas there is a risk that proposed policy changes might actually slow down the rate of housing development. However, the most significant conclusion is that, even if the required amounts of capital can be mobilised, the real problem is the affordability of operations and maintenance. Under the scenario selected for analysis, which represents government’s current targets, the majority of municipalities will experience difficulty with recurrent costs. In the situation where budget deficits affect operations and maintenance, this may lead to the premature deterioration (or collapse) of expensive assets, environmental damage and, ultimately, a negative effect on local economic growth. Even the modest levels of service proposed under this scenario would be difficult to sustain in an environment of low affordability and an obligation to provide free basic services. This highlights the need to explore other scenarios for national policy and for each municipality to undertake its own detailed infrastructure investment planning to ensure the selection of the most appropriate and affordable levels of service. These conclusions are carried through to Chapter 6 in a discussion on servicing marginalised communities. The causes of marginalisation include a legacy of poor service delivery with extensive ongoing backlogs, generally depressed incomes, and problems of location and migration. In addressing these problems in marginalised areas, most municipalities face a number of financial, social and institutional challenges. Many of the financial challenges are those described by the analysis in Chapter 5, only more acute. The ability and willingness to pay of those in marginal communities has always been problematic. Consumers should be involved in the choice of LOS to establish what they are willing to pay for. Tariff structures must be pro-poor while at the same time ensuring sufficient income for the service provider. Subsidies must be carefully managed to avoid unintended consequences. For example, there is always a risk that a supplyside subsidy, such as the “equitable share”, might cause service providers to concentrate more on securing subsidies than actually serving consumers. The social challenges in marginalised communities are many. Analysis of the last two censuses showed that average household size has decreased and new household formation has accelerated rapidly. There is considerable migration between rural and urban areas, some of which is seasonal and circulatory, thus making planning difficult. The impact of HIV and AIDS is dire. The pandemic is having serious effects on demographics, household characteristics and incomes, placing a strain on the demand for certain services and reducing the skilled workforce and productivity of service providers. A recurring theme throughout the report is the inadequate capacity of service providers to fulfil their responsibilities. South Africa has completely overhauled its legislative, fiscal, regulatory and policy environments to enhance service delivery to the poor and marginalised, but it is increasingly clear that institutional capacity is the primary constraining factor. Delivering and operating new infrastructure are complex activities and competent skilled persons are in short supply, especially at distance from the major urban centres. Some elements of public-private partnerships (PPP) have been introduced to address this problem but more could be done, provided they are adequately regulated. In addition, the technical activities of municipalities are dependent on good governance, and this aspect is also suffering from a lack of appropriate experience. 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All sections in Part III consist of tabular and graphical views of access to household services, provided at the different geographical levels, being provincial, metropolitan, district and local municipal levels. Tables 1 to 4 depict this information on a provincial level. A comparison of the access to household services on a metropolitan level is undertaken in Tables 5 to 8. The next geographical level of information includes information on a district municipality level (Tables 9 to 12), while information on the local municipalities is included in Tables 13 to 16. Information pertaining to District Management Areas is included in Tables 13 to 16. The latter part of Part III consists of maps which depict the spatially uneven distribution of household access to services on a local municipal level. A special word of thanks is due to Frans Jacobs of the DBSA’s Development Information Unit (DIU) for his assistance in compiling the maps. While every care has been taken to ensure the accuracy of the information in this annexure, the DBSA cannot take responsibility for any errors. Andries Mouton Editor: Household Services Indicators PART III KEY HOUSEHOLD SERVICES INDICATORS 211 CONTENTS List of tables: Table 1 South Africa and provinces: Access to piped water, 1996 and 2001 ..............................................................215 Table 2 South Africa and provinces: Access to sanitation, 1996 and 2001 .................................................................216 Table 3 South Africa and provinces: Households not utilising electricity as an energy source, 1996 and 2001 .......217 Table.4 South Africa and provinces: Households with access or nearby access to telephones, 1996 and 2001 .......218 Table 5 Metropolitan municipalities: Access to piped water, 1996 and 2001 .............................................................219 Table 6 Metropolitan municipalities: Access to sanitation: 1996 and 2001 ................................................................220 Table 7 Metropolitan municipalities: Households not utilising electricity as an energy source, 1996 and 2001 .....221 Table 8 Metropolitan municipalities: Households with access or nearby access to telephones, 1996 and 2001......222 Table 9 District municipalities: Access to piped water, 1996 and 2001 .............................................................. 223-224 Table 10 District municipalities: Access to sanitation, 1996 and 2001 .................................................................. 226-227 Table 11 District municipalities: Households not utilising electricity as an energy source, 1996 and 2001 ........ 229-230 Table 12 District municipalities: Households with access or nearby access to telephones, 1996 and 2001 ........ 232-233 Table 13 Local municipalities: Access to piped water, 1996 and 2001 .................................................................. 235-245 Table 14 Local municipalities: Access to sanitation, 1996 and 2001 ...................................................................... 246-256 Table 15 Local municipalities: Households not utilising electricity as an energy source, 1996 and 2001 ........... 257-267 Table 16 Local municipalities: Households with access or nearby access to telephones, 1996 and 2001 ........... 268-278 List of figures: Figure 1 Provinces: Number of households without access to piped water, 1996 and 2001 .......................................215 Figure 2 Provinces: Percentage of households without access to piped water, 1996 and 2001 .................................215 Figure 3 Provinces: Number of households without access to sanitation, 1996 and 2001 ..........................................216 Figure 4 Provinces: Percentage of households without access to sanitation, 1996 and 2001 .....................................216 Figure 5 Provinces: Number of households not utilising electricity as an energy source, 1996 and 2001 .................217 Figure 6 Provinces: Percentage of households not utilising electricity as an energy source, 1996 and 2001 ............217 Figure 7 Provinces: Number of households with no access or no nearby access to telephones, 1996 and 2001 ...................................................................................................................................................218 Figure 8 Provinces: Percentage of households with no access or no nearby access to telephones, 1996 and 2001 ...................................................................................................................................................218 Figure 9 Metropolitan municipalities: Number of households without access to piped water, 1996 and 2001 .............................................. ....................................................................................................219 Figure 10 Metropolitan municipalities: Percentage of households without access to piped water, 1996 and 2001 ...................................................................................................................................................219 Figure 11 Metropolitan municipalities: Number of households without access to sanitation, 1996 and 2001 ...........220 Figure 12 Metropolitan municipalities Percentage of households without access to sanitation, 1996 and 2001 ......220 Figure 13 Metropolitan municipalities: Number of households not utilising electricity as an energy source, 1996 and 2001 ...................................................................................................................................................221 Figure 14: Metropolitan municipalities: Percentage of households not utilising electricity as an energy source, 1996 and 2001 ...................................................................................................................................................221 Figure 15: Metropolitan municipalities: Number of households with no access or no nearby access to telephones, 1996 and 2001 ...................................................................................................................................................222 Figure 16 Metropolitan municipalities: Percentage of households with no access or no nearby access to telephones,1996 and 2001 ................................................................................................................................222 Figure 17 District municipalities: Number of households without access to piped water, 2001 ...................................225 Figure 18 District municipalities: Number of households without access to sanitation, 2001 ......................................228 Figure 19 District municipalities: Number of households not utilising electricity as an energy source, 2001 .............231 Figure 20 District municipalities: Number of households with no access or no nearby access to telephones, 2001 ...............................................................................................................................................234 212 THE DBSA INFRASTRUCTURE BAROMETER List of Maps: Map 1: Western Cape: Number of households without access to piped water, 2001 ...............................................279 Map 2 Eastern Cape: Number of households without access to piped water, 2001 .................................................279 Map 3 Northern Cape: Number of households without access to piped water, 2001 ..............................................280 Map 4 Free State: Number of households without access to piped water, 2001 ......................................................280 Map 5 KwaZulu/Natal: Number of households without access to piped water, 2001 ..............................................281 Map 6 North West: Number of households without access to piped water, 2001....................................................281 Map 7 Gauteng: Number of households without access to piped water, 2001 ........................................................282 Map 8 Mpumalanga: Number of households without access to piped water, 2001 ................................................282 Map 9 Limpopo: Number of households without access to piped water, 2001 ........................................................283 Map 10 Western Cape: Number of households without access to sanitation, 2001 ...................................................283 Map 11 Eastern Cape: Number of households without access to sanitation, 2001 ....................................................284 Map 12 Northern Cape: Number of households without access to sanitation, 2001 .................................................284 Map 13 Free State: Number of households without access to sanitation, 2001 .........................................................285 Map 14 KwaZulu/Natal: Number of households without access to sanitation, 2001 .................................................285 Map 15 North West: Number of households without access to sanitation, 2001 .......................................................286 Map 16 Gauteng: Number of households without access to sanitation, 2001 ...........................................................286 Map 17 Mpumalanga: Number of households without access to sanitation, 2001....................................................287 Map 18 Limpopo: Number of households without access to sanitation, 2001 ...........................................................287 Map 19 Western Cape: Number of households not utilising electricity as an energy source, 2001 ..........................288 Map 20 Eastern Cape: Number of households not utilising electricity as an energy source, 2001............................288 Map 21 Northern Cape: Number of households not utilising electricity as an energy source, 2001.........................289 Map 22 Free State: Number of households not utilising electricity as an energy source, 2001.................................289 Map 23 KwaZulu/Natal: Number of households not utilising electricity as an energy source, 2001.........................290 Map 24 North West: Number of households not utilising electricity as an energy source, 2001 ..............................290 Map 25 Gauteng: Number of households not utilising electricity as an energy source, 2001 ...................................291 Map 26 Mpumalanga: Number of households not utilising electricity as an energy source, 2001 ...........................291 Map 27 Limpopo: Number of households not utilising electricity as an energy source, 2001...................................292 Map 28 Western Cape: Number of households with no access or no nearby access to telephones, 2001 ................292 Map 29 Eastern Cape: Number of households with no access or no nearby access to telephones, 2001 .................293 Map 30 Northern Cape: Number of households with no access or no nearby access to telephones, 2001 ..............293 Map 31 Free State: Number of households with no access or no nearby access to telephones, 2001 ......................294 Map 32 KwaZulu/Natal: Number of households with no access or no nearby access to telephones, 2001 ..............294 Map 33 North West: Number of households with no access or no nearby access to telephones, 2001 ....................295 Map 34 Gauteng: Number of households with no access or no nearby access to telephones, 2001 ........................295 Map 35 Mpumalanga: Number of households with no access or no nearby access to telephones, 2001.................296 Map 36 Limpopo: Number of households with no access or no nearby access to telephones, 2001 ........................296 Bibliography ............................................................................................................................................................................297 Addresses ............................................................................................................................................................................298 Photographic credits ...............................................................................................................................................................298 PART III KEY HOUSEHOLD SERVICES INDICATORS 213 Technical Note The primary source of information for this chapter is Statistics South Africa: 2001 Census: Community Profile database. However, it should be noted that, because the defining characteristics of the 1996 and 2001 census categories differed in many instances, it was not always possible to compare information. To mitigate this problem and to facilitate a greater degree of comparability, information relating to “access to household services” was grouped into two broad categories, namely, those “without access” and those “with access”. The specific definitions attached to access to services for each sector are as follows: 1996 and 2001 Census categories: Sector Service level 1996 Census category 2001 Census category Water Without access to piped water Unspecified, other, dam/river/stream/ spring, borehole/rainwater/tank/well, water-carrier/tanker Piped water in the dwelling, piped water on site, public tap Other, water vendor, river/ stream, dam/pool/stagnant water, rainwater tank, spring, borehole Piped water inside dwelling, piped water inside yard, piped water on community stand: distance less than 200m from dwelling, piped water on community stand: distance greater than 200m from dwelling Access to piped water Sanitation Without access With access Unspecified, none, bucket latrine Flush or chemical toilet, pit latrine None, bucket latrine Flush toilet (connected to a sewerage system), flush toilet (with septic tank), chemical toilet, pit latrine with ventilation (VIP), pit latrine without ventilation Energy (utilising electricity as a source of energy for lighting purposes) Not utilising electricity Unspecified, other, candles, paraffin, gas Electricity direct from authority, electricity from other source Other, candles, paraffin, gas Unspecified, dummy, hostel/ institution: No telephone on premises, household: no access to a telephone, household: at another location not nearby Household; in this dwelling/cell-phone, household: at a neighbour nearby, household: at a public telephone nearby, household: at another location nearby, hostel/ institution: telephone on premises No access to a telephone, at another location not nearby Utilising electricity Telephone No access or no nearby access Access or nearby access 214 THE DBSA INFRASTRUCTURE BAROMETER Electricity, solar Telephone in dwelling and cell-phone, telephone in dwelling only, cell-phone only, at a neighbour nearby, at a public telephone nearby, at another location nearby Table 1: South Africa and provinces: Access to piped water, 1996 and 2001 1996 Province Total number of households 2001 Without access to piped water Number % With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % Western Cape 985 490 31 850 3.2 953 640 96.8 1 208 983 20 595 1.7 1 188 388 98.3 Eastern Cape 1 333 862 620 283 46.5 713 579 53.5 1 535 966 572 379 37.3 963 587 62.7 Northern Cape 187 596 16 710 8.9 170 886 91.1 219 981 7 249 3.3 212 732 96.7 Free State 626 339 37 610 6.0 588 729 94.0 757 261 32 201 4.3 725 060 95.7 KwaZulu-Natal 1 665 299 561 876 33.7 1 103 423 66.3 2 200 429 570 148 25.9 1 630 281 74.1 721 652 134 149 18.6 587 503 81.4 977 950 129 724 13.3 848 226 86.7 1 967 597 79 554 4.0 1 888 043 96.0 2 836 334 68 514 2.4 2 767 820 97.6 Mpumalanga 605 110 107 886 17.8 497 224 82.2 783 003 100 826 12.9 682 177 87.1 Limpopo 984 457 241 496 24.5 742 961 75.5 1 250 363 264 823 21.2 985 540 78.8 9 077 402 1 831 414 20.2 7 245 988 79.8 11 770 270 1 766 459 15.0 10 003 811 85.0 North West Gauteng Total Figure 1: Provinces: Number of households without access to piped water, 1996 and 2001 Figure 2: Provinces: Percentage of households without access to piped water, 1996 and 2001 PART III KEY HOUSEHOLD SERVICES INDICATORS 215 Table 2: South Africa and provinces: Access to sanitation, 1996 and 2001 1996 Province Total number of households 2001 Without access to sanitation Number With access to sanitation % Number Total number of households % Without access to sanitation Number % Number % Western Cape 985 490 93 688 9.5 891 802 90.5 1 208 982 136 509 11.3 1 072 473 88.7 Eastern Cape 1 333 862 477 784 35.8 856 078 64.2 1 535 967 555 265 36.2 980 702 63.8 187 596 54 523 29.1 133 073 70.9 219 981 48 662 22.1 171 319 77.9 Northern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo Total 626 339 185 991 29.7 440 348 70.3 757 259 222 889 29.4 534 370 70.6 1 665 299 278 515 16.7 1 386 784 83.3 2 200 431 375 531 17.1 1 824 900 82.9 721 652 95 734 13.3 625 918 86.7 977 948 134 429 13.7 843 519 86.3 1 967 597 109 358 5.6 1 858 239 94.4 2 836 335 164 101 5.8 2 672 234 94.2 605 110 77 720 12.8 527 390 87.2 783 005 102 002 13.0 681 003 87.0 984 457 218 531 22.2 765 926 77.8 1 250 365 294 178 23.5 956 187 76.5 9 077 402 1 591 844 17.5 7 485 558 82.5 11 770 273 2 033 566 17.3 9 736 707 82.7 Figure 3: Provinces: Number of households without access to sanitation, 1996 and 2001 Figure 4: Provinces: Percentage of households without access to sanitation, 1996 and 2001 216 With access to sanitation THE DBSA INFRASTRUCTURE BAROMETER Table 3: South Africa and provinces: Households not utilising electricity as an energy source, 1996 and 2001 1996 Province Total number of households 2001 Not utilising electricity Number % Utilising electricity Number Total number of households % Not utilising electricity Number % Utilising electricity Number % Western Cape 985 490 145 746 14.8 839 744 85.2 1 208 981 142 895 11.8 1 066 086 88.2 Eastern Cape 1 333 862 910 388 68.3 423 474 31.7 1 535 969 768 075 50.0 767 894 50.0 187 596 55 051 29.3 132 545 70.7 219 981 49 138 22.3 170 843 77.7 Northern Cape Free State KwaZulu-Natal North West Gauteng 626 339 268 292 42.8 358 047 57.2 757 259 188 427 24.9 568 832 75.1 1 665 299 772 851 46.4 892 448 53.6 2 200 431 828 289 37.6 1 372 142 62.4 721 652 403 278 55.9 318 374 44.1 977 948 280 080 28.6 697 868 71.4 1 967 597 402 386 20.5 1 565 211 79.5 2 836 336 532 046 18.8 2 304 290 81.2 Mpumalanga 605 110 262 519 43.4 342 591 56.6 783 004 246 075 31.4 536 929 68.6 Limpopo 984 457 623 519 63.3 360 938 36.7 1 250 363 446 523 35.7 803 840 64.3 9 077 402 3 844 030 42.3 5 233 372 57.7 11 770 272 3 481 548 29.6 8 288 724 70.4 Total Figure 5: Provinces: Number of households not utilising electricity as an energy source, 1996 and 2001 Figure 6: Provinces: Percentage of households not utilising elctricity as an energy source, 1996 and 2001 PART III KEY HOUSEHOLD SERVICES INDICATORS 217 Table 4: South Africa and provinces: Households with access or nearby access to telephones, 1996 and 2001 1996 Province Total number of households 2001 No access/ no nearby access Number With access/ nearby access % Number Total number of households % No access/ not nearby access Number % Number % Western Cape 985 490 44 780 4.5 940 710 95.5 1 208 983 32 550 2.7 1 176 433 97.3 Eastern Cape 1 333 862 692 709 51.9 641 153 48.1 1 535 968 309 083 20.1 1 226 885 79.9 Northern Cape 187 596 27 910 14.9 159 686 85.1 219 980 16 206 7.4 203 774 92.6 Free State 626 339 116 818 18.7 509 521 81.3 757 259 76 694 10.1 680 565 89.9 KwaZulu-Natal 1 665 299 470 871 28.3 1 194 428 71.7 2 200 430 299 188 13.6 1 901 242 86.4 721 652 199 255 27.6 522 397 72.4 977 950 95 316 9.7 882 634 90.3 1 967 597 127 108 6.5 1 840 489 93.5 2 836 336 66 881 2.4 2 769 455 97.6 Mpumalanga 605 110 130 170 21.5 474 940 78.5 783 003 64 954 8.3 718 049 91.7 Limpopo 984 457 437 423 44.4 547 034 55.6 1 250 363 145 040 11.6 1 105 323 88.4 9 077 402 2 247 044 24.8 6 830 358 75.2 11 770 272 1 105 912 9.4 10 664 360 90.6 North West Gauteng Total Figure 7: Provinces: Number of households with no access or no nearby access to telephones 1996 and 2001 Figure 8: Provinces: Percentage of households with no access or no nearby access to telephones, 1996 and 2001 218 With access/ nearby access THE DBSA INFRASTRUCTURE BAROMETER Table 5: Metropolitan municipalities: Access to piped water, 1996 and 2001 Province Metropolitan Municipality 1996 Total number of households Without access to piped water Number Western Cape City of Cape Town 2001 % With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % 652 413 14 565 2.2 637 848 97.8 777 396 9 893 1.3 767 503 98.7 Kwazulu-Natal Ethekwini 647 916 39 430 6.1 608 486 93.9 823 699 40 976 5.0 782 723 95.0 Gauteng Ekurhuleni 543 296 18 683 3.4 524 613 96.6 776 551 12 702 1.6 763 849 98.4 Gauteng City of 734 425 18 847 2.6 715 578 97.4 1 049 669 30 191 2.9 1 019 478 97.1 225 515 4 663 2.1 220 852 97.9 265 104 3 483 1.3 261 621 98.7 430 807 24 585 5.7 406 222 94.3 597 882 26 783 4.5 571 099 95.5 3 234 372 120 773 3.7 3 113 599 96.3 4 290 301 124 028 2.9 4 166 273 97.1 Johannesburg Eastern Cape Nelson Mandela Gauteng City of Tshwane Total Figure 9: Metropolitan municipalities: Number of households without access to piped water, 1996 and 2001 Figure 10: Metropolitan municipalities: Percentage of households without access to piped water, 1996 and 2001 PART III KEY HOUSEHOLD SERVICES INDICATORS 219 Table 6: Metropolitan municipalities: Access to sanitation, 1996 and 2001 Province Metropolitan Municipality 1996 Total number of households Without access Number Western Cape City of 2001 With access % Number Total number of households % Without access Number With access % Number % 652 413 54 409 8.3 598 004 91.7 777 396 90 231 11.6 687 165 88.4 823 699 43 048 5.2 780 651 94.8 Cape Town Kwazulu-Natal Ethekwini 647 916 27 101 4.2 620 815 95.8 Gauteng Ekurhuleni 543 296 32 587 6.0 510 709 94.0 776 552 46 031 5.9 730 521 94.1 Gauteng City of 734 425 48 867 6.7 685 558 93.3 1 049 670 68 969 6.6 980 701 93.4 225 515 33 079 14.7 192 436 85.3 265 104 46 915 17.7 218 189 82.3 430 807 8 548 2.0 422 259 98.0 597 883 21 871 3.7 576 012 96.3 3 234 372 204 591 6.3 3 029 781 93.7 4 290 304 317 065 7.4 3 973 239 92.6 Johannesburg Eastern Cape Nelson Mandela Gauteng City of Tshwane Total Figure 11: Metropolitan municipalities: Number of households without access to sanitation 1996 and 2001 Figure 12: Metropolitan municipalities: Percentage of households without access to sanitation, 1996 and 2001 220 THE DBSA INFRASTRUCTURE BAROMETER Table 7: Metropolitan municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province Western Cape Metropolitan Municipality City of Cape Town 1996 Total number of households 652 413 Not utilising electricity Number 85 917 % 2001 Utilising electricity Number % Total number of households Not utilising electricity Number % Utilising electricity Number % 13.2 566 496 86.8 777 397 86 542 11.1 690 855 88.9 Kwazulu-Natal Ethekwini 647 916 170 059 26.2 477 857 73.8 823 698 161 028 19.5 662 670 80.5 Gauteng Ekurhuleni 543 296 136 995 25.2 406 301 74.8 776 552 191 443 24.7 585 109 75.3 Gauteng City of 734 425 110 873 15.1 623 552 84.9 1 049 669 155 984 14.9 893 685 85.1 225 515 65 763 29.2 159 752 70.8 265 104 65 624 24.8 199 480 75.2 430 807 95 754 22.2 335 053 77.8 597 882 119 614 20.0 478 268 80.0 3 234 372 665 361 20.6 2 569 011 79.4 4 290 302 780 235 18.2 3 510 067 81.8 Johannesburg Eastern Cape Nelson Mandela Gauteng City of Tshwane Total Figure 13: Metropolitan municipalities: Number of households not utilising electricity as an energy source, 1996 and 2001 Figure 14: Metropolitan municipalities: Percentage of households not utilising electricity as an energy source, 1996 and 2001 PART III KEY HOUSEHOLD SERVICES INDICATORS 221 Table 8: Metropolitan municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province Metropolitan Municipality 1996 Total number of households No access/ no nearby access Number Western Cape City of Cape Town Kwazulu-Natal Ethekwini Gauteng Ekurhuleni Gauteng 2001 % With access/ nearby access Number Total number of households % No access/ no nearby access Number Number % 652 413 19 860 3.0 632 553 97.0 777 396 14 640 1.9 762 756 98.1 647 916 49 753 7.7 598 163 92.3 823 700 42 537 5.2 781 163 94.8 543 296 43 199 8.0 500 097 92.0 776 550 17 325 2.2 759 225 97.8 City of Johannesburg 734 425 39 877 5.4 694 548 94.6 1 049 670 23 928 2.3 1 025 742 97.7 Eastern Cape Nelson Mandela 225 515 12 539 5.6 212 976 94.4 265 104 8 466 3.2 256 638 96.8 Gauteng City of Tshwane 430 807 33 037 7.7 397 770 92.3 597 883 12 684 2.1 585 199 97.9 3 234 372 198 265 6.1 3 036 107 93.9 4 290 303 119 580 2.8 4 170 723 97.2 Total Figure 15: Metropolitan municipalities: Number of households with no access or no nearby access to telephones, 1996 and 2001 Figure 16: Metropolitan municipalities: Percentage of households with no access or no nearby access to telephones, 1996 and 2001 222 % With access/ nearby access THE DBSA INFRASTRUCTURE BAROMETER Table 9: District municipalities: Access to piped water, 1996 and 2001 Province District Municipality 1996 2001 Total Without access to piped With access to piped Total Without access to piped With access to piped number of water water number of water water households households Number Western Cape DC1: West Coast Western Cape DC2: Boland Western Cape % Number % Number % Number % 56 422 2 059 3.6 54 363 96.4 77 673 1 497 1.9 76 176 98.1 131 461 5 302 4.0 126 159 96.0 159 440 3 070 1.9 156 370 98.1 DC3: Overberg 41 174 2 213 5.4 38 961 94.6 58 566 761 1.3 57 805 98.7 Western Cape DC4: Eden 90 900 7 217 7.9 83 683 92.1 120 747 5 233 4.3 115 514 95.7 Western Cape DC5: Central Karoo 12 460 483 3.9 11 977 96.1 15 165 173 1.1 14 992 98.9 Northern Cape DC6: Namakwa 26 464 2 896 10.9 23 568 89.1 30 487 1 209 4.0 29 278 96.0 Northern Cape DC7: Karoo 39 021 3 392 8.7 35 629 91.3 41 761 1 207 2.9 40 554 97.1 Northern Cape DC8: Siyanda 43 785 5 601 12.8 38 184 87.2 55 901 2 653 4.7 53 248 95.3 Northern Cape DC9: Frances Baard 72 552 3 790 5.2 68 762 94.8 85 227 2 498 2.9 82 729 97.1 Eastern Cape DC10: Cacadu 83 582 11 304 13.5 72 278 86.5 102 739 7 600 7.4 95 139 92.6 Eastern Cape DC12: Amatole 361 986 140 738 38.9 221 248 61.1 424 339 129 572 30.5 294 767 69.5 Eastern Cape DC13: Chris Hani 170 702 86 822 50.9 83 880 49.1 189 772 73 551 38.8 116 221 61.2 Eastern Cape DC14: Ukhahlamba 71 104 36 965 52.0 34 139 48.0 85 904 36 357 42.3 49 547 57.7 Eastern Cape DC15: O.R.Tambo 306 948 248 292 80.9 58 656 19.1 343 696 247 612 72.0 96 084 28.0 Free State DC16: Xhariep 30 877 2 684 8.7 28 193 91.3 39 234 1 296 3.3 37 938 96.7 Free State DC17: Motheo 171 214 5 840 3.4 165 374 96.6 210 388 8 785 4.2 201 603 95.8 Free State DC18: Lejweleputswa 162 209 8 374 5.2 153 835 94.8 196 639 8 295 4.2 188 344 95.8 Free State DC19: Thabo Mofutsanyane 156 893 12 656 8.1 144 237 91.9 186 171 11 362 6.1 174 809 93.9 Free State DC20: Northern Free State 105 146 8 056 7.7 97 090 92.3 124 825 2 388 1.9 122 437 98.1 Kwazulu-Natal DC21: Ugu 122 388 76 855 62.8 45 533 37.2 158 305 78 877 49.8 79 428 50.2 Kwazulu-Natal DC22: UMgungundlovu 190 408 43 970 23.1 146 438 76.9 234 434 35 201 15.0 199 233 85.0 Kwazulu-Natal DC23: Uthukela 95 066 36 516 38.4 58 550 61.6 138 729 44 723 32.2 94 006 67.8 Kwazulu-Natal DC24: Umzinyathi 75 376 49 196 65.3 26 180 34.7 94 911 50 729 53.4 44 182 46.6 Kwazulu-Natal DC25: Amajuba 74 362 17 861 24.0 56 501 76.0 98 052 21 250 21.7 76 802 78.3 PART III KEY HOUSEHOLD SERVICES INDICATORS 223 Table 9: (continued) District municipalities: Access to piped water, 1996 and 2001 Province District Municipality 1996 2001 Total Without access to piped With access to piped Total Without access to piped With access to piped number of water water number of water water households households Number Kwazulu-Natal DC26: Zululand Kwazulu-Natal DC27: Umkhanyakude Kwazulu-Natal DC28: Uthungulu Kwazulu-Natal DC29: iLembe Mpumalanga Number % Number % Number % 107 581 65 094 60.5 42 487 39.5 150 859 73 107 48.5 77 752 51.5 73 208 60 468 82.6 12 740 17.4 105 649 59 178 56.0 46 471 44.0 122 956 82 303 66.9 40 653 33.1 189 617 78 377 41.3 111 240 58.7 108 174 64 785 59.9 43 389 40.1 129 935 59 454 45.8 70 481 54.2 DC30: Gert Sibande 173 499 34 412 19.8 139 087 80.2 222 053 28 954 13.0 193 099 87.0 Mpumalanga DC31: Nkangala 208 221 30 738 14.8 177 483 85.2 257 255 28 135 10.9 229 120 89.1 Mpumalanga DC32: Ehlanzeni 176 529 31 392 17.8 145 137 82.2 240 163 29 436 12.3 210 727 87.7 Limpopo DC33: Mopani 183 123 27 625 15.1 155 498 84.9 237 504 35 857 15.1 201 647 84.9 Limpopo DC34: Vhembe 212 251 32 313 15.2 179 938 84.8 274 283 36 806 13.4 237 477 86.6 Limpopo DC35: Capricorn 208 252 53 148 25.5 155 104 74.5 284 968 65 944 23.1 219 024 76.9 Limpopo DC36: Waterberg 117 615 31 374 26.7 86 241 73.3 168 070 22 754 13.5 145 316 86.5 North West DC37: Bojanala 241 407 52 679 21.8 188 728 78.2 333 303 51 692 15.5 281 611 84.5 North West DC38: Central 137 890 33 054 24.0 104 836 76.0 184 588 40 510 21.9 144 078 78.1 North West DC39: Bophirima 87 450 21 113 24.1 66 337 75.9 106 707 12 483 11.7 94 224 88.3 North West DC40: Southern 126 589 7 389 5.8 119 200 94.2 174 698 3 690 2.1 171 008 97.9 Gauteng DC42: Sedibeng 182 116 10 506 5.8 171 610 94.2 229 992 3 651 1.6 226 341 98.4 Kwazulu-Natal DC43: Sisonke 47 802 25 338 53.0 22 464 47.0 76 240 28 184 37.0 48 056 63.0 Eastern Cape DC44: Alfred Nzo 113 601 91 488 80.5 22 113 19.5 124 416 74 481 59.9 49 935 40.1 Northern Cape/ North West CBDC1: Kgalagadi 35 417 9 071 25.6 26 346 74.4 43 765 7 699 17.6 36 066 82.4 Gauteng/ Mpumalanga CBDC2: Metsweding 29 393 6 271 21.3 23 122 78.7 49 959 2 975 6.0 46 984 94.0 Limpopo/ Mpumalanga CBDC3: Sekhukhune 171 471 80 381 46.9 91 090 53.1 204 710 85 636 41.8 119 074 58.2 Limpopo/ Mpumalanga CBDC4: Bohlabela 131 888 27 841 21.1 104 047 78.9 135 000 31 698 23.5 103 302 76.5 North West/ Gauteng CBDC8: West Rand 153 046 12 759 8.3 140 287 91.7 283 129 5 828 2.1 277 301 97.9 5 841 979 1 710 624 29.3 4 131 355 70.7 7 479 968 1 642 428 22.0 5 837 540 78.0 Total 224 % THE DBSA INFRASTRUCTURE BAROMETER Figure 17: District municipalities: Number of households without access to piped water, 2001 PART III KEY HOUSEHOLD SERVICES INDICATORS 225 Table 10: District municipalities: Access to sanitation, 1996 and 2001 Province District Municipality 1996 Total number of households Number 226 Western Cape DC1: West Coast Western Cape DC2: Boland Western Cape 2001 Without access With access % Number Total number of households % Without access Number With access % Number % 56 422 7 109 12.6 49 313 87.4 77 674 7 969 10.3 69 705 89.7 131 461 11 701 8.9 119 760 91.1 159 440 15 559 9.8 143 881 90.2 DC3: Overberg 41 174 4 882 11.9 36 292 88.1 58 566 6 499 11.1 52 067 88.9 Western Cape DC4: Eden 90 900 12 131 13.3 78 769 86.7 120 747 14 821 12.3 105 926 87.7 Western Cape DC5: Central Karoo 12 460 3 296 26.5 9 164 73.5 15 164 1 534 10.1 13 630 89.9 Northern Cape DC6: Namakwa 26 464 10 503 39.7 15 961 60.3 30 489 7 451 24.4 23 038 75.6 Northern Cape DC7: Karoo 39 021 17 339 44.4 21 682 55.6 41 762 15 621 37.4 26 141 62.6 Northern Cape DC8: Siyanda 43 785 10 357 23.7 33 428 76.3 55 900 10 437 18.7 45 463 81.3 Northern Cape DC9: Frances Baard 72 552 14 764 20.3 57 788 79.7 85 227 14 082 16.5 71 145 83.5 Eastern Cape DC10: Cacadu 83 582 26 325 31.5 57 257 68.5 102 739 27 037 26.3 75 702 73.7 Eastern Cape DC12: Amatole 361 986 112 339 31.0 249 647 69.0 424 338 132 647 31.3 291 691 68.7 Eastern Cape DC13: Chris Hani 170 702 83 580 49.0 87 122 51.0 189 770 90 765 47.8 99 005 52.2 Eastern Cape DC14: Ukhahlamba 71 104 35 663 50.2 35 441 49.8 85 904 43 351 50.5 42 553 49.5 Eastern Cape DC15: O.R.Tambo 306 948 157 396 51.3 149 552 48.7 343 697 181 958 52.9 161 739 47.1 Free State DC16: Xhariep 30 877 11 667 37.8 19 210 62.2 39 234 9 077 23.1 30 157 76.9 Free State DC17: Motheo 171 214 45 194 26.4 126 020 73.6 210 387 57 390 27.3 152 997 72.7 Free State DC18: Lejweleputswa 162 209 57 883 35.7 104 326 64.3 196 640 74 040 37.7 122 600 62.3 Free State DC19: Thabo Mofutsanyane 156 893 41 277 26.3 115 616 73.7 186 171 53 632 28.8 132 539 71.2 Free State DC20: Northern Free State 105 146 29 970 28.5 75 176 71.5 124 822 28 172 22.6 96 650 77.4 Kwazulu-Natal DC21: Ugu 122 388 17 100 14.0 105 288 86.0 158 306 28 698 18.1 129 608 81.9 Kwazulu-Natal DC22: UMgungundlovu 190 408 11 913 6.3 178 495 93.7 234 432 17 080 7.3 217 352 92.7 Kwazulu-Natal DC23: Uthukela 95 066 19 346 20.4 75 720 79.6 138 730 26 610 19.2 112 120 80.8 Kwazulu-Natal DC24: Umzinyathi 75 376 34 882 46.3 40 494 53.7 94 911 40 720 42.9 54 191 57.1 Kwazulu-Natal DC25: Amajuba 74 362 3 606 4.8 70 756 95.2 98 051 7 152 7.3 90 899 92.7 THE DBSA INFRASTRUCTURE BAROMETER Table 10: (continued) District municipalities: Access to sanitation, 1996 and 2001 Province District Municipality 1996 Total number of households Number Kwazulu-Natal DC26: Zululand Kwazulu-Natal DC27: Umkhanyakude Kwazulu-Natal 2001 Without access With access % Number Total number of households % Without access Number With access % Number % 107 581 39 431 36.7 68 150 63.3 150 861 59 922 39.7 90 939 60.3 73 208 47 395 64.7 25 813 35.3 105 650 59 954 56.7 45 696 43.3 DC28: Uthungulu 122 956 43 600 35.5 79 356 64.5 189 618 56 272 29.7 133 346 70.3 Kwazulu-Natal DC29: iLembe 108 174 28 039 25.9 80 135 74.1 129 935 26 362 20.3 103 573 79.7 Mpumalanga DC30: Gert Sibande 173 499 35 287 20.3 138 212 79.7 222 053 40 131 18.1 181 922 81.9 Mpumalanga DC31: Nkangala 208 221 12 898 6.2 195 323 93.8 257 255 15 683 6.1 241 572 93.9 Mpumalanga DC32: Ehlanzeni 176 529 26 086 14.8 150 443 85.2 240 164 39 648 16.5 200 516 83.5 Limpopo DC33: Mopani 183 123 59 792 32.7 123 331 67.3 237 503 83 191 35.0 154 312 65.0 Limpopo DC34: Vhembe 212 251 49 278 23.2 162 973 76.8 274 285 72 089 26.3 202 196 73.7 Limpopo DC35: Capricorn 208 252 37 163 17.8 171 089 82.2 284 968 50 243 17.6 234 725 82.4 Limpopo DC36: Waterberg 117 615 13 167 11.2 104 448 88.8 168 071 25 433 15.1 142 638 84.9 North West DC37: Bojanala 241 407 15 611 6.5 225 796 93.5 333 303 32 328 9.7 300 975 90.3 North West DC38: Central 137 890 14 405 10.4 123 485 89.6 184 590 21 558 11.7 163 032 88.3 North West DC39: Bophirima 87 450 19 499 22.3 67 951 77.7 106 708 25 305 23.7 81 403 76.3 North West DC40: Southern 126 589 38 820 30.7 87 769 69.3 174 698 41 715 23.9 132 983 76.1 Gauteng DC42: Sedibeng 182 116 8 399 4.6 173 717 95.4 229 991 10 884 4.7 219 107 95.3 Kwazulu-Natal DC43: Sisonke 47 802 6 046 12.6 41 756 87.4 76 240 9 753 12.8 66 487 87.2 Eastern Cape DC44: Alfred Nzo 113 601 29 397 25.9 84 204 74.1 124 416 32 736 26.3 91 680 73.7 Northern Cape/ North West CBDC1: Kgalagadi 35 417 6 322 17.9 29 095 82.1 43 764 9 217 21.1 34 547 78.9 Gauteng/ Mpumalanga CBDC2: Metsweding 29 393 1 708 5.8 27 685 94.2 49 959 5 592 11.2 44 367 88.8 Limpopo/ Mpumalanga CBDC3: Sekhukhune 171 471 36 390 21.2 135 081 78.8 204 709 35 930 17.6 168 779 82.4 Limpopo/ Mpumalanga CBDC4: Bohlabela 131 888 26 043 19.7 105 845 80.3 134 999 33 291 24.7 101 708 75.3 North West/ Gauteng CBDC8: West Rand 153 046 12 088 7.9 140 958 92.1 283 129 16 967 6.0 266 162 94.0 Total 5 841 979 1 387 087 23.7 4 454 892 76.3 7 479 970 1 716 506 22.9 5 763 464 77.1 PART III KEY HOUSEHOLD SERVICES INDICATORS 227 Figure 18: District municipalities: Number of households without access to sanitation, 2001 228 THE DBSA INFRASTRUCTURE BAROMETER Table 11: District municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality 1996 Total number of households Not utilising electricity Number Western Cape DC1: West Coast Western Cape DC2: Boland Western Cape % 2001 Utilising electricity Number Total number of households % Not utilising electricity Number % Utilising electricity Number % 56 422 10 209 18.1 46 213 81.9 77 674 9 141 11.8 68 533 88.2 131 461 20 260 15.4 111 201 84.6 159 440 18 280 11.5 141 160 88.5 DC3: Overberg 41 174 7 194 17.5 33 980 82.5 58 565 9 391 16.0 49 174 84.0 Western Cape DC4: Eden 90 900 19 332 21.3 71 568 78.7 120 747 17 301 14.3 103 446 85.7 Western Cape DC5: Central Karoo 12 460 2 668 21.4 9 792 78.6 15 165 2 085 13.7 13 080 86.3 Northern Cape DC6: Namakwa 26 464 8 587 32.4 17 877 67.6 30 489 6 201 20.3 24 288 79.7 Northern Cape DC7: Karoo 39 021 13 266 34.0 25 755 66.0 41 762 9 676 23.2 32 086 76.8 Northern Cape DC8: Siyanda 43 785 15 400 35.2 28 385 64.8 55 902 14 012 25.1 41 890 74.9 Northern Cape DC9: Frances Baard 72 552 17 031 23.5 55 521 76.5 85 226 18 489 21.7 66 737 78.3 Eastern Cape DC10: Cacadu 83 582 29 484 35.3 54 098 64.7 102 742 28 683 27.9 74 059 72.1 Eastern Cape DC12: Amatole 361 986 254 627 70.3 107 359 29.7 424 338 191 517 45.1 232 821 54.9 Eastern Cape DC13: Chris Hani 170 702 122 857 72.0 47 845 28.0 189 772 93 173 49.1 96 599 50.9 Eastern Cape DC14: Ukhahlamba 71 104 52 151 73.3 18 953 26.7 85 903 48 392 56.3 37 511 43.7 Eastern Cape DC15: O.R.Tambo 306 948 278 263 90.7 28 685 9.3 343 696 245 486 71.4 98 210 28.6 Free State DC16: Xhariep 30 877 8 313 26.9 22 564 73.1 39 233 9 083 23.2 30 150 76.8 Free State DC17: Motheo 171 214 64 722 37.8 106 492 62.2 210 389 33 227 15.8 177 162 84.2 Free State DC18: Lejweleputswa 162 209 51 996 32.1 110 213 67.9 196 640 54 973 28.0 141 667 72.0 Free State DC19: Thabo Mofutsanyane 156 893 93 367 59.5 63 526 40.5 186 170 67 134 36.1 119 036 63.9 Free State DC20: Northern Free State 105 146 49 894 47.5 55 252 52.5 124 824 23 575 18.9 101 249 81.1 Kwazulu-Natal DC21: Ugu 122 388 70 290 57.4 52 098 42.6 158 304 80 369 50.8 77 935 49.2 Kwazulu-Natal DC22: UMgungundlovu 190 408 76 139 40.0 114 269 60.0 234 432 61 162 26.1 173 270 73.9 Kwazulu-Natal DC23: Uthukela 95 066 53 645 56.4 41 421 43.6 138 728 57 997 41.8 80 731 58.2 Kwazulu-Natal DC24: Umzinyathi 75 376 61 891 82.1 13 485 17.9 94 912 69 958 73.7 24 954 26.3 Kwazulu-Natal DC25: Amajuba 74 362 20 529 27.6 53 833 72.4 98 051 26 915 27.5 71 136 72.5 PART III KEY HOUSEHOLD SERVICES INDICATORS 229 Table 11: (continued) District municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality 1996 Total number of households Not utilising electricity Number Kwazulu-Natal DC26: Zululand Kwazulu-Natal DC27: Umkhanyakude Kwazulu-Natal Number Total number of households % Not utilising electricity Number % Utilising electricity Number % 107 581 78 719 73.2 28 862 26.8 150 859 91 697 60.8 59 162 39.2 73 208 64 412 88.0 8 796 12.0 105 649 82 496 78.1 23 153 21.9 DC28: Uthungulu 122 956 74 659 60.7 48 297 39.3 189 617 84 502 44.6 105 115 55.4 Kwazulu-Natal DC29: iLembe 108 174 64 946 60.0 43 228 40.0 129 937 63 569 48.9 66 368 51.1 Mpumalanga DC30: Gert Sibande 173 499 96 740 55.8 76 759 44.2 222 053 91 595 41.2 130 458 58.8 Mpumalanga DC31: Nkangala 208 221 56 608 27.2 151 613 72.8 257 255 52 898 20.6 204 357 79.4 Mpumalanga DC32: Ehlanzeni 176 529 98 758 55.9 77 771 44.1 240 166 87 682 36.5 152 484 63.5 Limpopo DC33: Mopani 183 123 87 355 47.7 95 768 52.3 237 503 73 263 30.8 164 240 69.2 Limpopo DC34: Vhembe 212 251 147 414 69.5 64 837 30.5 274 285 105 123 38.3 169 162 61.7 Limpopo DC35: Capricorn 208 252 138 933 66.7 69 319 33.3 284 968 115 619 40.6 169 349 59.4 Limpopo DC36: Waterberg 117 615 64 036 54.4 53 579 45.6 168 071 58 319 34.7 109 752 65.3 North West DC37: Bojanala 241 407 145 878 60.4 95 529 39.6 333 304 85 075 25.5 248 229 74.5 North West DC38: Central 137 890 87 369 63.4 50 521 36.6 184 588 53 801 29.1 130 787 70.9 North West DC39: Bophirima 87 450 60 855 69.6 26 595 30.4 106 707 42 488 39.8 64 219 60.2 North West DC40: Southern 126 589 47 522 37.5 79 067 62.5 174 699 35 996 20.6 138 703 79.4 Gauteng DC42: Sedibeng 182 116 39 028 21.4 143 088 78.6 229 992 32 071 13.9 197 921 86.1 Kwazulu-Natal DC43: Sisonke 47 802 37 494 78.4 10 308 21.6 76 240 48 124 63.1 28 116 36.9 Eastern Cape DC44: Alfred Nzo 113 601 107 221 94.4 6 380 5.6 124 415 95 013 76.4 29 402 23.6 Northern Cape/ North West CBDC1: Kgalagadi 35 417 22 715 64.1 12 702 35.9 43 762 18 034 41.2 25 728 58.8 Gauteng/ Mpumalanga CBDC2: Metsweding 29 393 11 445 38.9 17 948 61.1 49 960 14 792 29.6 35 168 70.4 Limpopo/ Mpumalanga CBDC3: Sekhukhune 171 471 107 648 62.8 63 823 37.2 204 711 74 475 36.4 130 236 63.6 Limpopo/ Mpumalanga CBDC4: Bohlabela 131 888 87 930 66.7 43 958 33.3 134 999 32 764 24.3 102 235 75.7 North West/ Gauteng CBDC8: West Rand 153 046 48 693 31.8 104 353 68.2 283 128 65 698 23.2 217 430 76.8 5 841 979 3 178 493 54.4 2 663 486 45.6 7 479 972 2 701 314 36.1 4 778 658 63.9 Total 230 % 2001 Utilising electricity THE DBSA INFRASTRUCTURE BAROMETER Figure 19: District municipalities: Number of households not utilising electricity as an energy source, 2001 PART III KEY HOUSEHOLD SERVICES INDICATORS 231 Table 12: District municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province District Municipality 1996 Total number of households Number 232 Western Cape DC1: West Coast Western Cape DC2: Boland Western Cape 2001 No access/ no nearby access % With access/ nearby access Number Total number of households % No access/ no nearby access Number % With access/ nearby access Number % 56 422 3 617 6.4 52 805 93.6 77 674 4 785 6.2 72 889 93.8 131 461 11 386 8.7 120 075 91.3 159 440 6 102 3.8 153 338 96.2 DC3: Overberg 41 174 2 562 6.2 38 612 93.8 58 568 1 624 2.8 56 944 97.2 Western Cape DC4: Eden 90 900 5 449 6.0 85 451 94.0 120 747 4 478 3.7 116 269 96.3 Western Cape DC5: Central Karoo 12 460 1 903 15.3 10 557 84.7 15 165 1 073 7.1 14 092 92.9 Northern Cape DC6: Namakwa 26 464 2 864 10.8 23 600 89.2 30 488 1 638 5.4 28 850 94.6 Northern Cape DC7: Karoo 39 021 7 640 19.6 31 381 80.4 41 764 3 482 8.3 38 282 91.7 Northern Cape DC8: Siyanda 43 785 6 599 15.1 37 186 84.9 55 902 3 783 6.8 52 119 93.2 Northern Cape DC9: Frances Baard 72 552 10 222 14.1 62 330 85.9 85 227 6 062 7.1 79 165 92.9 Eastern Cape DC10: Cacadu 83 582 7 218 8.6 76 364 91.4 102 740 6 939 6.8 95 801 93.2 Eastern Cape DC12: Amatole 361 986 168 866 46.6 193 120 53.4 424 339 69 419 16.4 354 920 83.6 Eastern Cape DC13: Chris Hani 170 702 106 025 62.1 64 677 37.9 189 772 38 493 20.3 151 279 79.7 Eastern Cape DC14: Ukhahlamba 71 104 43 961 61.8 27 143 38.2 85 904 28 692 33.4 57 212 66.6 Eastern Cape DC15: O.R.Tambo 306 948 254 391 82.9 52 557 17.1 343 698 102 398 29.8 241 300 70.2 Free State DC16: Xhariep 30 877 6 724 21.8 24 153 78.2 39 232 5 979 15.2 33 253 84.8 Free State DC17: Motheo 171 214 26 410 15.4 144 804 84.6 210 388 13 190 6.3 197 198 93.7 Free State DC18: Lejweleputswa 162 209 24 634 15.2 137 575 84.8 196 640 20 761 10.6 175 879 89.4 Free State DC19: Thabo Mofutsanyane 156 893 39 165 25.0 117 728 75.0 186 170 25 194 13.5 160 976 86.5 Free State DC20: Northern Free State 105 146 19 885 18.9 85 261 81.1 124 823 11 224 9.0 113 599 91.0 Kwazulu-Natal DC21: Ugu 122 388 46 878 38.3 75 510 61.7 158 304 25 406 16.0 132 898 84.0 Kwazulu-Natal DC22: UMgungundlovu 190 408 48 776 25.6 141 632 74.4 234 432 30 506 13.0 203 926 87.0 Kwazulu-Natal DC23: Uthukela 95 066 36 327 38.2 58 739 61.8 138 728 20 687 14.9 118 041 85.1 Kwazulu-Natal DC24: Umzinyathi 75 376 37 704 50.0 37 672 50.0 94 911 28 324 29.8 66 587 70.2 Kwazulu-Natal DC25: Amajuba 74 362 16 596 22.3 57 766 77.7 98 051 8 709 8.9 89 342 91.1 THE DBSA INFRASTRUCTURE BAROMETER Table 12: (continued) District municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province District Municipality 1996 Total number of households Number Kwazulu-Natal DC26: Zululand Kwazulu-Natal DC27: Umkhanyakude Kwazulu-Natal 2001 No access/ no nearby access % With access/ nearby access Number Total number of households % No access/ no nearby access Number % With access/ nearby access Number % 107 581 59 336 55.2 48 245 44.8 150 860 36 769 24.4 114 091 75.6 73 208 44 748 61.1 28 460 38.9 105 649 24 169 22.9 81 480 77.1 DC28: Uthungulu 122 956 61 941 50.4 61 015 49.6 189 616 43 319 22.8 146 297 77.2 Kwazulu-Natal DC29: iLembe 108 174 48 283 44.6 59 891 55.4 129 936 21 192 16.3 108 744 83.7 Mpumalanga DC30: Gert Sibande 173 499 34 955 20.1 138 544 79.9 222 053 19 619 8.8 202 434 91.2 Mpumalanga DC31: Nkangala 208 221 33 090 15.9 175 131 84.1 257 254 11 969 4.7 245 285 95.3 Mpumalanga DC32: Ehlanzeni 176 529 47 897 27.1 128 632 72.9 240 164 26 365 11.0 213 799 89.0 Limpopo DC33: Mopani 183 123 89 692 49.0 93 431 51.0 237 503 25 652 10.8 211 851 89.2 Limpopo DC34: Vhembe 212 251 100 380 47.3 111 871 52.7 274 285 31 073 11.3 243 212 88.7 Limpopo DC35: Capricorn 208 252 70 167 33.7 138 085 66.3 284 968 23 643 8.3 261 325 91.7 Limpopo DC36: Waterberg 117 615 32 484 27.6 85 131 72.4 168 071 20 170 12.0 147 901 88.0 North West DC37: Bojanala 241 407 71 155 29.5 170 252 70.5 333 304 23 204 7.0 310 100 93.0 North West DC38: Central 137 890 54 011 39.2 83 879 60.8 184 588 30 696 16.6 153 892 83.4 North West DC39: Bophirima 87 450 32 093 36.7 55 357 63.3 106 706 15 813 14.8 90 893 85.2 North West DC40: Southern 126 589 15 960 12.6 110 629 87.4 174 697 12 426 7.1 162 271 92.9 Gauteng DC42: Sedibeng 182 116 11 002 6.0 171 114 94.0 229 992 7 384 3.2 222 608 96.8 Kwazulu-Natal DC43: Sisonke 47 802 20 510 42.9 27 292 57.1 76 239 17 242 22.6 58 997 77.4 Eastern Cape DC44: Alfred Nzo 113 601 99 672 87.7 13 929 12.3 124 416 55 142 44.3 69 274 55.7 Northern Cape/ North West CBDC1: Kgalagadi 35 417 12 690 35.8 22 727 64.2 43 765 8 757 20.0 35 008 80.0 Gauteng/ Mpumalanga CBDC2: Metsweding 29 393 3 255 11.1 26 138 88.9 49 962 2 412 4.8 47 550 95.2 Limpopo/ Mpumalanga CBDC3: Sekhukhune 171 471 95 931 55.9 75 540 44.1 204 710 36 142 17.7 168 568 82.3 Limpopo/ Mpumalanga CBDC4: Bohlabela 131 888 62 720 47.6 69 168 52.4 134 997 15 099 11.2 119 898 88.8 North West/ Gauteng CBDC8: West Rand 153 046 10 990 7.2 142 056 92.8 283 129 9 144 3.2 273 985 96.8 5 841 979 2 048 764 35.1 3 793 215 64.9 7 479 971 986 349 13.2 6 493 622 86.8 Total PART III KEY HOUSEHOLD SERVICES INDICATORS 233 Figure 20: District municipalities: Number of households with no access or no nearby access to telephones, 2001 234 THE DBSA INFRASTRUCTURE BAROMETER Table 13: Local municipalities: Access to piped water, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households 2001 Without access to piped water Number % With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % Western Cape DC1: West Coast WC011: Matzikama 9 956 327 3.3 9 629 96.7 14 466 476 3.3 13 990 96.7 Western Cape DC1: West Coast WC012: Cederberg 7 803 399 5.1 7 404 94.9 11 181 181 1.6 11 000 98.4 Western Cape DC1: West Coast WC013: Bergrivier 8 886 418 4.7 8 468 95.3 13 295 243 1.8 13 052 98.2 Western Cape DC1: West Coast WC014: Saldanha Bay 12 791 232 1.8 12 559 98.2 18 889 229 1.2 18 660 98.8 Western Cape DC1: West Coast WC015: Swartland 15 889 508 3.2 15 381 96.8 18 667 285 1.5 18 382 98.5 Western Cape DC2: Boland WC022: Witzenberg 16 124 555 3.4 15 569 96.6 20 382 229 1.1 20 153 98.9 Western Cape DC2: Boland WC023: Drakenstein 42 245 1 776 4.2 40 469 95.8 46 215 956 2.1 45 259 97.9 Western Cape DC2: Boland WC024: Stellenbosch 26 186 903 3.4 25 283 96.6 34 772 361 1.0 34 411 99.0 Western Cape DC2: Boland WC025: Breede Valley 29 190 891 3.1 28 299 96.9 35 004 806 2.3 34 198 97.7 Western Cape DC2: Boland WC026:Breede River/Winelands 16 122 991 6.1 15 131 93.9 21 154 638 3.0 20 516 97.0 Western Cape DC3: Overberg WC031: Theewaterskloof 18 057 451 2.5 17 606 97.5 24 302 222 0.9 24 080 99.1 Western Cape DC3: Overberg WC032: Overstrand 11 412 751 6.6 10 661 93.4 19 056 216 1.1 18 840 98.9 Western Cape DC3: Overberg WC033: Cape Agulhas 5 595 102 1.8 5 493 98.2 7 545 54 0.7 7 491 99.3 Western Cape DC3: Overberg WC034: Swellendam 6 098 909 14.9 5 189 85.1 7 597 266 3.5 7 331 96.5 Western Cape DC4: Eden WC041: Kannaland 4 855 861 17.7 3 994 82.3 6 137 369 6.0 5 768 94.0 Western Cape DC4: Eden WC042: Langeberg 9 743 1 015 10.4 8 728 89.6 12 623 409 3.2 12 214 96.8 Western Cape DC4: Eden WC043: Mossel Bay 15 420 817 5.3 14 603 94.7 20 195 549 2.7 19 646 97.3 Western Cape DC4: Eden WC044: George 25 700 1 549 6.0 24 151 94.0 36 114 2 022 5.6 34 092 94.4 Western Cape DC4: Eden WC045: Oudtshoorn 15 734 860 5.5 14 874 94.5 18 310 772 4.2 17 538 95.8 Western Cape DC4: Eden WC047: Plettenberg Bay 5 075 592 11.7 4 483 88.3 8 919 392 4.4 8 527 95.6 Western Cape DC4: Eden WC048: Knysna 11 498 1 172 10.2 10 326 89.8 14 901 513 3.4 14 388 96.6 Western Cape DC5: Central Karoo WC051: Laingsburg 1 461 122 8.4 1 339 91.6 1 942 48 2.5 1 894 97.5 Western Cape DC5: Central Karoo WC052: Prince Albert 2 132 125 5.9 2 007 94.1 2 604 37 1.4 2 567 98.6 Western Cape DC5: Central Karoo WC053: Beaufort West 7 309 198 2.7 7 111 97.3 9 062 71 0.8 8 991 99.2 PART III KEY HOUSEHOLD SERVICES INDICATORS 235 Table 13: (continued) Local municipalities: Access to piped water, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number 236 2001 Without access to piped water % With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % Eastern Cape DC10: Cacadu EC101: Camdeboo 9 388 141 1.5 9 247 98.5 10 465 81 0.8 10 384 99.2 Eastern Cape DC10: Cacadu EC102: Blue Crane Route 8 001 1 151 14.4 6 850 85.6 9 539 943 9.9 8 596 90.1 Eastern Cape DC10: Cacadu EC103: Ikwezi 2 329 246 10.6 2 083 89.4 2 747 36 1.3 2 711 98.7 Eastern Cape DC10: Cacadu EC104: Makana 16 329 1 144 7.0 15 185 93.0 18 153 875 4.8 17 278 95.2 Eastern Cape DC10: Cacadu EC105: Ndlambe 11 668 1 799 15.4 9 869 84.6 15 917 1 692 10.6 14 225 89.4 Eastern Cape DC10: Cacadu EC106: Sunday’s River Valley 9 411 2 732 29.0 6 679 71.0 10 516 2 178 20.7 8 338 79.3 Eastern Cape DC10: Cacadu EC107: Baviaans 3 106 493 15.9 2 613 84.1 3 888 208 5.3 3 680 94.7 Eastern Cape DC10: Cacadu EC108: Kouga 14 552 975 6.7 13 577 93.3 19 520 496 2.5 19 024 97.5 Eastern Cape DC10: Cacadu EC109: Kou-Kamma 6 856 2 099 30.6 4 757 69.4 9 961 1 072 10.8 8 889 89.2 Eastern Cape DC12: Amatole EC121: Mbhashe 48 880 45 821 93.7 3 059 6.3 53 172 46 783 88.0 6 389 12.0 Eastern Cape DC12: Amatole EC122: Mnquma 60 052 46 085 76.7 13 967 23.3 67 858 42 388 62.5 25 470 37.5 Eastern Cape DC12: Amatole EC123: Great Kei 8 408 2 062 24.5 6 346 75.5 11 507 1 863 16.2 9 644 83.8 Eastern Cape DC12: Amatole EC124: Amahlathi 29 176 11 795 40.4 17 381 59.6 34 875 11 273 32.3 23 602 67.7 Eastern Cape DC12: Amatole EC125: Buffalo City 160 779 15 261 9.5 145 518 90.5 194 063 11 957 6.2 182 106 93.8 Eastern Cape DC12: Amatole EC126: Ngqushwa 20 620 9 713 47.1 10 907 52.9 21 891 5 534 25.3 16 357 74.7 Eastern Cape DC12: Amatole EC127: Nkonkobe 28 637 9 585 33.5 19 052 66.5 34 361 9 179 26.7 25 182 73.3 Eastern Cape DC12: Amatole EC128: Nxuba 5 434 416 7.7 5 018 92.3 6 634 403 6.1 6 231 93.9 Eastern Cape DC13: Chris Hani EC131: Inxuba Yethemba 13 064 790 6.0 12 274 94.0 16 049 455 2.8 15 594 97.2 Eastern Cape DC13: Chris Hani EC132: Tsolwana 7 754 761 9.8 6 993 90.2 7 933 1 143 14.4 6 790 85.6 Eastern Cape DC13: Chris Hani EC133: Inkwanca 4 270 251 5.9 4 019 94.1 5 477 133 2.4 5 344 97.6 Eastern Cape DC13: Chris Hani EC134: Lukanji 37 447 5 944 15.9 31 503 84.1 44 908 3 258 7.3 41 650 92.7 Eastern Cape DC13: Chris Hani EC135: Intsika Yethu 44 194 36 033 81.5 8 161 18.5 45 172 29 122 64.5 16 050 35.5 Eastern Cape DC13: Chris Hani EC136: Emalahleni 25 512 14 179 55.6 11 333 44.4 26 066 12 213 46.9 13 853 53.1 Eastern Cape DC13: Chris Hani EC137: Engcobo 28 423 24 860 87.5 3 563 12.5 31 424 23 887 76.0 7 537 24.0 THE DBSA INFRASTRUCTURE BAROMETER Table 13: (continued) Local municipalities: Access to piped water, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households 2001 Without access to piped water Number % With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % Eastern Cape DC13: Chris Hani EC138: Sakhisizwe 10 016 4 000 39.9 6 016 60.1 12 719 3 476 27.3 9 243 72.7 Eastern Cape DC14: Ukhahlamba EC141: Elundini 29 585 23 136 78.2 6 449 21.8 33 786 22 460 66.5 11 326 33.5 Eastern Cape DC14: Ukhahlamba EC142: Senqu 27 923 12 919 46.3 15 004 53.7 34 052 12 679 37.2 21 373 62.8 Eastern Cape DC14: Ukhahlamba EC143: Maletswai 7 007 553 7.9 6 454 92.1 9 790 771 7.9 9 019 92.1 Eastern Cape DC14: Ukhahlamba EC144: Gariep 6 589 357 5.4 6 232 94.6 8 267 297 3.6 7 970 96.4 Eastern Cape DC15: O.R.Tambo EC151: Mbizana 41 891 38 870 92.8 3 021 7.2 46 340 38 130 82.3 8 210 17.7 Eastern Cape DC15: O.R.Tambo EC152: Ntabankulu 22 984 20 705 90.1 2 279 9.9 27 171 21 831 80.3 5 340 19.7 Eastern Cape DC15: O.R.Tambo EC153: Qaukeni 44 358 37 947 85.5 6 411 14.5 51 215 40 014 78.1 11 201 21.9 Eastern Cape DC15: O.R.Tambo EC154: Port St Johns 27 286 25 272 92.6 2 014 7.4 29 317 23 608 80.5 5 709 19.5 Eastern Cape DC15: O.R.Tambo EC155: Nyandeni 50 742 42 969 84.7 7 773 15.3 56 490 43 678 77.3 12 812 22.7 Eastern Cape DC15: O.R.Tambo EC156: Mhlontlo 39 076 30 863 79.0 8 213 21.0 42 910 28 416 66.2 14 494 33.8 Eastern Cape DC15: O.R.Tambo EC157: King Sabata Dalindyebo 80 611 51 666 64.1 28 945 35.9 90 249 51 616 57.2 38 633 42.8 Eastern Cape DC44: Alfred Nzo EC05b1: Umzimkhulu 31 517 27 239 86.4 4 278 13.6 36 643 23 588 64.4 13 055 35.6 Eastern Cape DC44: Alfred Nzo EC05b2: Umzimvubu 82 084 64 249 78.3 17 835 21.7 87 762 50 852 57.9 36 910 42.1 Northern Cape DC6: Namakwa NC061: Richtersveld 3 038 300 9.9 2 738 90.1 2 873 42 1.5 2 831 98.5 Northern Cape DC6: Namakwa NC062: Nama Khoi 9 688 661 6.8 9 027 93.2 12 063 325 2.7 11 738 97.3 Northern Cape DC6: Namakwa NC064: Kamiesberg 2 597 802 30.9 1 795 69.1 3 229 438 13.6 2 791 86.4 Northern Cape DC6: Namakwa NC065: Hantam 5 078 538 10.6 4 540 89.4 5 492 85 1.5 5 407 98.5 Northern Cape DC6: Namakwa NC066: Karoo Hoogland 3 276 250 7.6 3 026 92.4 3 146 54 1.7 3 092 98.3 Northern Cape DC6: Namakwa NC067: KhGi-Ma 2 223 140 6.3 2 083 93.7 3 345 204 6.1 3 141 93.9 Northern Cape DC7: Karoo NC071: Ubuntu 4 237 449 10.6 3 788 89.4 4 245 163 3.8 4 082 96.2 Northern Cape DC7: Karoo NC072: Umsombomvu 5 454 240 4.4 5 214 95.6 5 882 90 1.5 5 792 98.5 Northern Cape DC7: Karoo NC073: Emthanjeni 8 540 402 4.7 8 138 95.3 8 805 69 0.8 8 736 99.2 Northern Cape DC7: Karoo NC074: Kareeberg 2 733 227 8.3 2 506 91.7 2 424 44 1.8 2 380 98.2 PART III KEY HOUSEHOLD SERVICES INDICATORS 237 Table 13: (continued) Local municipalities: Access to piped water, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number 238 2001 Without access to piped water % With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % Northern Cape DC7: Karoo NC075: Renosterberg 2 372 156 6.6 2 216 93.4 2 464 21 0.9 2 443 99.1 Northern Cape DC7: Karoo NC076: Thembelihle 2 836 289 10.2 2 547 89.8 3 478 48 1.4 3 430 98.6 Northern Cape DC7: Karoo NC077: Siyathemba 4 546 312 6.9 4 234 93.1 4 164 69 1.7 4 095 98.3 Northern Cape DC7: Karoo NC078: Siyancuma 7 013 1 095 15.6 5 918 84.4 9 216 552 6.0 8 664 94.0 Northern Cape DC8: Siyanda NC081: Mier 1 315 267 20.3 1 048 79.7 1 575 209 13.3 1 366 86.7 Northern Cape DC8: Siyanda NC082: !Kai! Garib 11 087 2 140 19.3 8 947 80.7 18 485 1 274 6.9 17 211 93.1 Northern Cape DC8: Siyanda NC083: Khara Hais 15 462 1 434 9.3 14 028 90.7 17 185 349 2.0 16 836 98.0 Northern Cape DC8: Siyanda NC084: !Kheis 2 939 417 14.2 2 522 85.8 3 949 418 10.6 3 531 89.4 Northern Cape DC8: Siyanda NC085: Tsantsabane 6 544 152 2.3 6 392 97.7 7 359 206 2.8 7 153 97.2 Northern Cape DC8: Siyanda NC086: Kgatelopele 3 898 612 15.7 3 286 84.3 4 106 39 0.9 4 067 99.1 Northern Cape DC9: Frances Baard NC091: Sol Plaatje 45 155 489 1.1 44 666 98.9 51 005 323 0.6 50 682 99.4 Northern Cape DC9: Frances Baard NC092: Dikgatlong 7 663 974 12.7 6 689 87.3 9 724 756 7.8 8 968 92.2 Northern Cape DC9: Frances Baard NC093: Magareng 5 252 482 9.2 4 770 90.8 5 812 335 5.8 5 477 94.2 Northern Cape CBDC1: Kgalagadi NC01B1: Gamagara 4 185 193 4.6 3 992 95.4 5 137 60 1.2 5 077 98.8 Free State DC16: Xhariep FS161: Letsemeng 8 962 1 170 13.1 7 792 86.9 12 084 611 5.1 11 473 94.9 Free State DC16: Xhariep FS162: Kopanong 13 132 786 6.0 12 346 94.0 17 611 438 2.5 17 173 97.5 Free State DC16: Xhariep FS163: Mohokare 8 783 728 8.3 8 055 91.7 9 540 195 2.0 9 345 98.0 Free State DC17: Motheo FS171: Naledi 6 300 252 4.0 6 048 96.0 7 672 217 2.8 7 455 97.2 Free State DC17: Motheo FS172: Mangaung 153 408 4 557 3.0 148 851 97.0 188 657 7 938 4.2 180 719 95.8 Free State DC17: Motheo FS173: Mantsopa 11 506 1 031 9.0 10 475 91.0 14 070 580 4.1 13 490 95.9 Free State DC18: Lejweleputswa FS181: Masilonyana 15 032 1 273 8.5 13 759 91.5 20 491 517 2.5 19 974 97.5 Free State DC18: Lejweleputswa FS182: Tokologo 6 619 633 9.6 5 986 90.4 8 965 418 4.7 8 547 95.3 Free State DC18: Lejweleputswa FS183: Tswelopele 11 377 1 338 11.8 10 039 88.2 12 533 329 2.6 12 204 97.4 Free State DC18: Lejweleputswa FS184: Matjhabeng 110 705 3 156 2.9 107 549 97.1 128 640 6 008 4.7 122 632 95.3 THE DBSA INFRASTRUCTURE BAROMETER Table 13: (continued) Local municipalities: Access to piped water, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households 2001 Without access to piped water Number % With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % Free State DC18: Lejweleputswa FS185: Nala 18 476 1 974 10.7 16 502 89.3 25 986 989 3.8 24 997 96.2 Free State DC19: Thabo Mofutsanyane FS191: Setsoto 26 299 2 211 8.4 24 088 91.6 33 562 1 571 4.7 31 991 95.3 Free State DC19: Thabo Mofutsanyane FS192: Dihlabeng 25 459 2 643 10.4 22 816 89.6 33 401 1 979 5.9 31 422 94.1 Free State DC19: Thabo Mofutsanyane FS193: Nketoana 14 749 2 298 15.6 12 451 84.4 15 021 406 2.7 14 615 97.3 Free State DC19: Thabo Mofutsanyane FS194: Maluti a Phofung 80 792 3 193 4.0 77 599 96.0 92 101 6 540 7.1 85 561 92.9 Free State DC19: Thabo Mofutsanyane FS195: Phumelela 9 475 2 268 23.9 7 207 76.1 12 025 1 016 8.4 11 009 91.6 Free State DC20: Northern Free State FS201: Moqhaka 37 545 3 062 8.2 34 483 91.8 43 835 816 1.9 43 019 98.1 Free State DC20: Northern Free State FS203: Ngwathe 29 613 2 129 7.2 27 484 92.8 32 508 709 2.2 31 799 97.8 Free State DC20:Northern Free State FS204: Metsimaholo 25 669 874 3.4 24 795 96.6 33 701 418 1.2 33 283 98.8 Free State DC20: Northern Free State FS205: Mafube 12 319 1 991 16.2 10 328 83.8 14 782 400 2.7 14 382 97.3 Kwazulu-Natal DC21: Ugu KZ211: Vulamehlo 17 023 14 907 87.6 2 116 12.4 16 798 11 437 68.1 5 361 31.9 Kwazulu-Natal DC21: Ugu KZ212: Umdoni 12 659 4 080 32.2 8 579 67.8 16 466 2 272 13.8 14 194 86.2 Kwazulu-Natal DC21: Ugu KZ213: Umzumbe 27 885 24 618 88.3 3 267 11.7 38 871 29 976 77.1 8 895 22.9 Kwazulu-Natal DC21: Ugu KZ214: uMuziwabantu 14 305 11 939 83.5 2 366 16.5 19 501 10 244 52.5 9 257 47.5 Kwazulu-Natal DC21: Ugu KZ215: Ezingoleni 8 058 7 005 86.9 1 053 13.1 11 430 6 806 59.5 4 624 40.5 Kwazulu-Natal DC21: Ugu KZ216: Hibiscus Coast 42 458 14 306 33.7 28 152 66.3 55 233 18 216 33.0 37 017 67.0 Kwazulu-Natal DC22: UMgungundlovu KZ221: uMshwathi 25 144 16 745 66.6 8 399 33.4 27 189 8 820 32.4 18 369 67.6 Kwazulu-Natal DC22: UMgungundlovu KZ222: uMngeni 15 771 1 718 10.9 14 053 89.1 22 659 1 644 7.3 21 015 92.7 Kwazulu-Natal DC22: UMgungundlovu KZ223: Mooi Mpofana 4 567 1 320 28.9 3 247 71.1 10 496 2 412 23.0 8 084 77.0 Kwazulu-Natal DC22: UMgungundlovu KZ224: Impendle 6 040 2 399 39.7 3 641 60.3 7 456 1 744 23.4 5 712 76.6 Kwazulu-Natal DC22: UMgungundlovu KZ225: Msunduzi 117 519 10 249 8.7 107 270 91.3 135 180 8 304 6.1 126 876 93.9 Kwazulu-Natal DC22: UMgungundlovu KZ226: Mkhambathini 8 949 4 578 51.2 4 371 48.8 15 415 5 513 35.8 9 902 64.2 Kwazulu-Natal DC22: UMgungundlovu KZ227: Richmond 12 266 6 883 56.1 5 383 43.9 16 001 6 766 42.3 9 235 57.7 Kwazulu-Natal DC23: Uthukela KZ232: Ladysmith 33 900 8 313 24.5 25 587 75.5 51 878 10 193 19.6 41 685 80.4 PART III KEY HOUSEHOLD SERVICES INDICATORS 239 Table 13: (continued) Local municipalities: Access to piped water, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Without access to piped water Number 240 Kwazulu-Natal DC23: Uthukela KZ233: Indaka Kwazulu-Natal DC23: Uthukela KZ234: Umtshezi Kwazulu-Natal DC23: Uthukela Kwazulu-Natal % 2001 With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % 15 043 6 822 45.3 8 221 54.7 21 470 8 135 37.9 13 335 62.1 9 038 2 223 24.6 6 815 75.4 13 953 3 210 23.0 10 743 77.0 KZ235: Okhahlamba 19 441 10 333 53.2 9 108 46.8 27 924 13 028 46.7 14 896 53.3 DC23: Uthukela KZ236: Imbabazane 17 569 8 819 50.2 8 750 49.8 23 270 10 275 44.2 12 995 55.8 Kwazulu-Natal DC24: Umzinyathi KZ241: Endumeni 9 279 935 10.1 8 344 89.9 13 107 944 7.2 12 163 92.8 Kwazulu-Natal DC24: Umzinyathi KZ242: Nqutu 19 873 11 971 60.2 7 902 39.8 25 962 10 085 38.8 15 877 61.2 Kwazulu-Natal DC24: Umzinyathi KZ244: Msinga 27 564 25 345 91.9 2 219 8.1 32 879 27 830 84.6 5 049 15.4 Kwazulu-Natal DC24: Umzinyathi KZ245: Umvoti 18 660 10 945 58.7 7 715 41.3 22 948 11 805 51.4 11 143 48.6 Kwazulu-Natal DC25: Amajuba KZ252: Newcastle 55 291 7 640 13.8 47 651 86.2 71 923 9 096 12.6 62 827 87.4 Kwazulu-Natal DC25: Amajuba KZ253: Utrecht 3 496 1 998 57.2 1 498 42.8 6 659 3 199 48.0 3 460 52.0 Kwazulu-Natal DC25: Amajuba KZ254: Dannhauser 15 575 8 223 52.8 7 352 47.2 19 471 8 880 45.6 10 591 54.4 Kwazulu-Natal DC26: Zululand KZ261: eDumbe 10 199 4 837 47.4 5 362 52.6 15 811 5 730 36.2 10 081 63.8 Kwazulu-Natal DC26: Zululand KZ262: uPhongolo 15 988 8 975 56.1 7 013 43.9 26 938 10 596 39.3 16 342 60.7 Kwazulu-Natal DC26: Zululand KZ263: Abaqulusi 27 362 9 598 35.1 17 764 64.9 37 017 13 199 35.7 23 818 64.3 Kwazulu-Natal DC26: Zululand KZ265: Nongoma 26 170 21 836 83.4 4 334 16.6 32 436 22 205 68.5 10 231 31.5 Kwazulu-Natal DC26: Zululand KZ266: Ulundi 27 862 19 848 71.2 8 014 28.8 38 648 21 235 54.9 17 413 45.1 Kwazulu-Natal DC27: Umkhanyakude KZ271: Umhlabuyalingana 18 770 16 006 85.3 2 764 14.7 26 661 17 965 67.4 8 696 32.6 Kwazulu-Natal DC27: Umkhanyakude KZ272: Jozini 22 126 18 678 84.4 3 448 15.6 34 738 17 513 50.4 17 225 49.6 Kwazulu-Natal DC27: Umkhanyakude KZ273: The Big 5 False Bay 3 739 3 246 86.8 493 13.2 7 071 4 354 61.6 2 717 38.4 Kwazulu-Natal DC27: Umkhanyakude KZ274: Hlabisa 21 855 19 906 91.1 1 949 8.9 27 266 17 614 64.6 9 652 35.4 Kwazulu-Natal DC27: Umkhanyakude KZ275: Mtubatuba 5 106 1 177 23.1 3 929 76.9 8 637 1 336 15.5 7 301 84.5 Kwazulu-Natal DC28: Uthungulu KZ281: Mbonambi 14 080 11 797 83.8 2 283 16.2 20 434 13 582 66.5 6 852 33.5 Kwazulu-Natal DC28: Uthungulu KZ282: uMhlathuze 38 375 10 121 26.4 28 254 73.6 73 234 7 895 10.8 65 339 89.2 Kwazulu-Natal DC28: Uthungulu KZ283: Ntambanana 10 270 9 138 89.0 1 132 11.0 13 829 9 235 66.8 4 594 33.2 THE DBSA INFRASTRUCTURE BAROMETER Table 13: (continued) Local municipalities: Access to piped water, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number Kwazulu-Natal DC28: Uthungulu KZ284: uMlalazi Kwazulu-Natal DC28: Uthungulu KZ285: Mthonjaneni Kwazulu-Natal DC28: Uthungulu Kwazulu-Natal 2001 Without access to piped water % With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % 35 421 29 096 82.1 6 325 17.9 44 600 25 663 57.5 18 937 42.5 5 301 4 118 77.7 1 183 22.3 12 647 5 880 46.5 6 767 53.5 KZ286: Nkandla 19 509 18 033 92.4 1 476 7.6 24 867 16 179 65.1 8 688 34.9 DC29: iLembe KZ291: eNdondakusuka 24 479 12 611 51.5 11 868 48.5 30 999 10 398 33.5 20 601 66.5 Kwazulu-Natal DC29: iLembe KZ292: KwaDukuza 36 841 9 933 27.0 26 908 73.0 45 897 9 726 21.2 36 171 78.8 Kwazulu-Natal DC29: iLembe KZ293: Ndwedwe 25 452 21 362 83.9 4 090 16.1 30 630 19 820 64.7 10 810 35.3 Kwazulu-Natal DC29: iLembe KZ294: Maphumulo 21 402 20 879 97.6 523 2.4 22 391 19 755 88.2 2 636 11.8 Kwazulu-Natal DC43: Sisonke KZ5a1: Ingwe 17 445 11 879 68.1 5 566 31.9 21 926 10 772 49.1 11 154 50.9 Kwazulu-Natal DC43: Sisonke KZ5a2: Kwa Sani 3 632 1 335 36.8 2 297 63.2 4 655 1 120 24.1 3 535 75.9 Kwazulu-Natal DC43: Sisonke KZ5a3: Matatiele 2 497 151 6.0 2 346 94.0 5 703 265 4.6 5 438 95.4 Kwazulu-Natal DC43: Sisonke KZ5a4: Greater Kokstad 8 729 1 408 16.1 7 321 83.9 20 535 961 4.7 19 574 95.3 Kwazulu-Natal DC43: Sisonke KZ5a5: Ubuhlebezwe 15 188 10 520 69.3 4 668 30.7 23 087 15 124 65.5 7 963 34.5 North West DC37: Bojanala NW371: Moretele 32 669 16 464 50.4 16 205 49.6 43 166 9 998 23.2 33 168 76.8 North West DC37: Bojanala NW372: Madibeng 76 065 17 300 22.7 58 765 77.3 97 226 14 830 15.3 82 396 84.7 North West DC37: Bojanala NW373: Rustenburg 75 722 12 297 16.2 63 425 83.8 119 580 19 713 16.5 99 867 83.5 North West DC37: Bojanala NW374: Kgetlengrivier 7 718 1 457 18.9 6 261 81.1 10 484 832 7.9 9 652 92.1 North West DC37: Bojanala NW375: Moses Kotane 49 137 5 159 10.5 43 978 89.5 62 710 6 260 10.0 56 450 90.0 North West DC38: Central NW381: Setla-Kgobi 17 642 2 998 17.0 14 644 83.0 22 714 7 512 33.1 15 202 66.9 North West DC38: Central NW382: Tswaing 17 687 3 226 18.2 14 461 81.8 25 622 2 473 9.7 23 149 90.3 North West DC38: Central NW383: Mafikeng 51 658 18 378 35.6 33 280 64.4 67 505 22 217 32.9 45 288 67.1 North West DC38: Central NW384: Ditsobotla 26 611 4 921 18.5 21 690 81.5 36 387 6 366 17.5 30 021 82.5 North West DC38: Central NW385: Zeerust 24 292 3 531 14.5 20 761 85.5 32 363 2 122 6.6 30 241 93.4 North West DC39: Bophirima NW391: Kagisano 18 871 8 429 44.7 10 442 55.3 23 391 6 709 28.7 16 682 71.3 North West DC39: Bophirima NW392: Naledi 12 414 1 684 13.6 10 730 86.4 15 223 228 1.5 14 995 98.5 PART III KEY HOUSEHOLD SERVICES INDICATORS 241 Table 13: (continued) Local municipalities: Access to piped water, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number 242 North West DC39: Bophirima NW393: Mamusa North West DC39: Bophirima NW394: Greater Taung North West DC39: Bophirima North West 2001 Without access to piped water % With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % 9 142 1 287 14.1 7 855 85.9 10 748 361 3.4 10 387 96.6 35 663 8 422 23.6 27 241 76.4 41 994 4 698 11.2 37 296 88.8 NW395: Molopo 3 584 730 20.4 2 854 79.6 3 791 216 5.7 3 575 94.3 DC39: Bophirima NW396: Lekwa-Teemane 7 776 561 7.2 7 215 92.8 11 571 359 3.1 11 212 96.9 North West DC40: Southern NW401: Ventersdorp 6 860 824 12.0 6 036 88.0 11 428 437 3.8 10 991 96.2 North West DC40: Southern NW402: Potchefstroom 29 089 1 985 6.8 27 104 93.2 33 965 673 2.0 33 292 98.0 North West DC40: Southern NW403: Klerksdorp 77 825 2 875 3.7 74 950 96.3 112 023 1 384 1.2 110 639 98.8 North West DC40: Southern NW404: Maquassi Hills 12 815 1 705 13.3 11 110 86.7 17 293 1 127 6.5 16 166 93.5 North West CBDC1 xxx Kgalagadi NW1a1: Moshaweng 16 176 6 483 40.1 9 693 59.9 18 370 5 904 32.1 12 466 67.9 Gauteng CBDC2: Metsweding GT02b1: Nokeng tsa Taemane 11 149 2 532 22.7 8 617 77.3 16 404 889 5.4 15 515 94.6 Gauteng CBDC8: West Rand GT411: Mogale City 61 551 4 786 7.8 56 765 92.2 89 497 2 076 2.3 87 421 97.7 Gauteng CBDC8: West Rand GT412: Randfontein 27 504 3 420 12.4 24 084 87.6 40 471 578 1.4 39 893 98.6 Gauteng CBDC8: West Rand GT414: Westonaria 23 219 2 109 9.1 21 110 90.9 51 487 1 358 2.6 50 129 97.4 Gauteng DC42: Sedibeng GT421: Emfuleni 148 889 5 211 3.5 143 678 96.5 190 157 2 087 1.1 188 070 98.9 Gauteng DC42: Sedibeng GT422: Midvaal 17 726 3 510 19.8 14 216 80.2 20 831 909 4.4 19 922 95.6 Gauteng DC42: Sedibeng GT423: Lesedi 15 501 1 785 11.5 13 716 88.5 18 999 670 3.5 18 329 96.5 Mpumalanga DC30: Gert Sibande MP301: Albert Luthuli 35 486 12 289 34.6 23 197 65.4 41 194 9 700 23.5 31 494 76.5 Mpumalanga DC30: Gert Sibande MP302: Msukaligwa 25 029 4 470 17.9 20 559 82.1 30 264 3 177 10.5 27 087 89.5 Mpumalanga DC30: Gert Sibande MP303: Mkhondo 18 816 6 209 33.0 12 607 67.0 28 899 9 436 32.7 19 463 67.3 Mpumalanga DC30: Gert Sibande MP304: Seme 14 560 4 642 31.9 9 918 68.1 18 392 3 157 17.2 15 235 82.8 Mpumalanga DC30: Gert Sibande MP305: Lekwa 20 479 2 904 14.2 17 575 85.8 26 172 785 3.0 25 387 97.0 Mpumalanga DC30: Gert Sibande MP306: Dipaleseng 9 454 1 521 16.1 7 933 83.9 9 572 600 6.3 8 972 93.7 Mpumalanga DC30: Gert Sibande MP307: Govan Mbeki 49 675 2 377 4.8 47 298 95.2 67 581 2 013 3.0 65 568 97.0 Mpumalanga DC31: Nkangala MP311: Delmas 12 355 2 133 17.3 10 222 82.7 13 953 942 6.8 13 011 93.2 THE DBSA INFRASTRUCTURE BAROMETER Table 13: (continued) Local municipalities: Access to piped water, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households 2001 Without access to piped water Number % With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % Mpumalanga DC31: Nkangala MP312: Emalahleni 56 469 3 079 5.5 53 390 94.5 82 241 5 096 6.2 77 145 93.8 Mpumalanga DC31: Nkangala MP313: Middelburg 33 644 3 936 11.7 29 708 88.3 37 040 1 491 4.0 35 549 96.0 Mpumalanga DC31: Nkangala MP314: Highlands 9 302 2 271 24.4 7 031 75.6 10 901 954 8.8 9 947 91.2 Mpumalanga DC31: Nkangala MP315: Thembisile 48 099 5 583 11.6 42 516 88.4 58 802 4 655 7.9 54 147 92.1 Mpumalanga DC31: Nkangala MP316: Dr JS Moroka 48 347 13 732 28.4 34 615 71.6 54 327 15 142 27.9 39 185 72.1 Mpumalanga DC32: Ehlanzeni MP321: Thaba Chweu 20 128 1 760 8.7 18 368 91.3 26 559 1 273 4.8 25 286 95.2 Mpumalanga DC32: Ehlanzeni MP322: Mbombela 91 615 14 703 16.0 76 912 84.0 121 951 16 039 13.2 105 912 86.8 Mpumalanga DC32: Ehlanzeni MP323: Umjindi 11 681 1 948 16.7 9 733 83.3 15 854 2 306 14.5 13 548 85.5 Mpumalanga DC32: Ehlanzeni MP324: Nkomazi 53 105 12 981 24.4 40 124 75.6 75 556 9 896 13.1 65 660 86.9 Limpopo DC33: Mopani NP331: Greater Giyani 42 183 2 565 6.1 39 618 93.9 52 860 7 166 13.6 45 694 86.4 Limpopo DC33: Mopani NP332: Greater Letaba 41 465 8 198 19.8 33 267 80.2 53 735 6 683 12.4 47 052 87.6 Limpopo DC33: Mopani NP333: Greater Tzaneen 73 898 14 662 19.8 59 236 80.2 97 376 20 387 20.9 76 989 79.1 Limpopo DC33: Mopani NP334: Ba-Phalaborwa 25 577 2 200 8.6 23 377 91.4 33 530 1 503 4.5 32 027 95.5 Limpopo DC34: Vhembe NP341: Musina 8 401 1 077 12.8 7 324 87.2 13 955 1 158 8.3 12 797 91.7 Limpopo DC34: Vhembe NP342: Mutale 13 113 3 639 27.8 9 474 72.2 17 644 3 848 21.8 13 796 78.2 Limpopo DC34: Vhembe NP343: Thulamela 101 760 14 078 13.8 87 682 86.2 129 155 19 073 14.8 110 082 85.2 Limpopo DC34: Vhembe NP344: Makhado 88 977 13 519 15.2 75 458 84.8 113 524 12 689 11.2 100 835 88.8 Limpopo DC35: Capricorn NP351: Blouberg 28 016 7 967 28.4 20 049 71.6 35 166 8 400 23.9 26 766 76.1 Limpopo DC35: Capricorn NP352: Aganang 27 584 7 239 26.2 20 345 73.8 32 523 5 910 18.2 26 613 81.8 Limpopo DC35: Capricorn NP353: Molemole 22 668 2 978 13.1 19 690 86.9 28 927 7 349 25.4 21 578 74.6 Limpopo DC35: Capricorn NP354: Polokwane 85 611 17 772 20.8 67 839 79.2 135 433 23 403 17.3 112 030 82.7 Limpopo DC35: Capricorn NP355: Lepele-Nkumpi 44 373 17 192 38.7 27 181 61.3 52 904 20 690 39.1 32 214 60.9 Limpopo DC36: Waterberg NP361: Thabazimbi 14 466 3 450 23.8 11 016 76.2 25 022 221 0.9 24 801 99.1 Limpopo DC36: Waterberg NP362: Lephalale 21 218 7 082 33.4 14 136 66.6 28 334 1 221 4.3 27 113 95.7 PART III KEY HOUSEHOLD SERVICES INDICATORS 243 Table 13: (continued) Local municipalities: Access to piped water, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number 244 Limpopo DC36: Waterberg NP364: Mookgopong Limpopo DC36: Waterberg Limpopo 2001 Without access to piped water % With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % 5 019 1 293 25.8 3 726 74.2 9 565 377 3.9 9 188 96.1 NP365: Modimolle 12 031 2 928 24.3 9 103 75.7 20 934 1 337 6.4 19 597 93.6 DC36: Waterberg NP366: Bela-Bela 11 165 2 148 19.2 9 017 80.8 14 159 487 3.4 13 672 96.6 Limpopo DC36: Waterberg NP367: Mogalakwena 53 716 14 473 26.9 39 243 73.1 70 081 19 178 27.4 50 903 72.6 Limpopo CBDC3: Sekhukhune NP03A2: 49 943 27 710 55.5 22 233 44.5 54 205 29 033 53.6 25 172 46.4 Limpopo CBDC3: Sekhukhune NP03A3: Fetakgomo 17 360 6 927 39.9 10 433 60.1 19 000 7 865 41.4 11 135 58.6 Limpopo CBDC4: Bohlabela NP04A1: Maruleng 18 364 4 660 25.4 13 704 74.6 23 031 3 267 14.2 19 764 85.8 Northern Cape/ North West CBDC1: Kgalagadi CBLC1: Ga-Segonyana 13 174 2 015 15.3 11 159 84.7 17 763 1 625 9.1 16 138 90.9 Gauteng/ Mpumalanga CBDC2: Metsweding CBLC2: Kungwini 18 244 3 739 20.5 14 505 79.5 33 559 2 178 6.5 31 381 93.5 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBLC3: Greater Marble Hall 19 388 7 357 37.9 12 031 62.1 26 538 8 688 32.7 17 850 67.3 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBLC4: Greater Groblersdal 42 245 18 668 44.2 23 577 55.8 48 747 19 242 39.5 29 505 60.5 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBLC5: Greater Tubatse 42 526 19 715 46.4 22 811 53.6 56 218 20 796 37.0 35 422 63.0 Limpopo/ Mpumalanga CBDC4: Bohlabela CBLC6: Bushbuckridge 112 986 23 089 20.4 89 897 79.6 109 663 28 441 25.9 81 222 74.1 Northern Cape/ North West DC9: Frances Baard CBLC7: Phokwane 13 406 1 411 10.5 11 995 89.5 17 078 956 5.6 16 122 94.4 North West/ Gauteng CBDC8: West Rand CBLC8: Merafong City 39 801 2 100 5.3 37 701 94.7 99 651 1 795 1.8 97 856 98.2 Western Cape DC1: West Coast WCDMA01: West Coast 1 097 175 16.0 922 84.0 1 178 93 7.9 1 085 92.1 Western Cape DC2: Boland WCDMA02: Breede River 1 594 186 11.7 1 408 88.3 1 931 45 2.3 1 886 97.7 Western Cape DC3: Overberg WCDMA03: Overberg 12 0 0.0 12 100.0 80 0 0.0 80 100.0 Western Cape DC4: Eden WCDMA04: South Cape 2 875 351 12.2 2 524 87.8 3 551 211 5.9 3 340 94.1 Western Cape DC5: Central Karoo WCDMA05: Central Karoo 1 558 38 2.4 1 520 97.6 1 568 33 2.1 1 535 97.9 Eastern Cape DC10: Cacadu ECDMA10: Aberdeen Plain 1 942 524 27.0 1 418 73.0 2 015 48 2.4 1 967 97.6 Eastern Cape DC13: Chris Hani ECDMA13: Mountain Zebra National Park 22 4 18.2 18 81.8 18 0 0.0 18 100.0 Eastern Cape DC14: Ukhahlamba ECDMA14: Oviston Nature Reserve 0 0 0.0 0 0.0 3 0 0.0 3 100.0 Eastern Cape DC44: Alfred Nzo ECDMA44: O’Conners Camp 0 0 0.0 0 0.0 0 0 0.0 0 0.0 Makhuduthamaga THE DBSA INFRASTRUCTURE BAROMETER Table 13: (continued) Local municipalities: Access to piped water, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number Northern Cape DC6: Namakwa NCDMA06: Namaqualand Northern Cape DC7: Karoo Northern Cape 2001 Without access to piped water % With access to piped water Number Total number of households % Without access to piped water Number % With access to piped water Number % 564 205 36.3 359 63.7 342 34 9.9 308 90.1 NCDMA07: Bo Karoo 1 290 222 17.2 1 068 82.8 1 097 118 10.8 979 89.2 DC8: Siyanda NCDMA08: Benede Oranje 2 540 579 22.8 1 961 77.2 3 241 76 2.3 3 165 97.7 Northern Cape DC9: Frances Baard NCDMA09: Diamondfields 1 076 434 40.3 642 59.7 1 613 65 4.0 1 548 96.0 Northern Cape CBDC1: Kgalagadi NCDMACB1: Kalahari 1 882 380 20.2 1 502 79.8 2 488 43 1.7 2 445 98.3 Free State DC19: Thabo Mofutsanyane FSDMA19: Golden Gate Highlands National Park 119 43 36.1 76 63.9 59 0 0.0 59 100.0 Kwazulu-Natal DC22: UMgungundlovu KZDMA22: Highmoor/ Kamberg Park 152 78 51.3 74 48.7 12 0 0.0 12 100.0 Kwazulu-Natal DC23: Uthukela KZDMA23: Gaints Castle Game Reserve 75 6 8.0 69 92.0 217 79 36.4 138 63.6 Kwazulu-Natal DC27: Umkhanyakude KZDMA27: St Lucia Park 1 612 1 455 90.3 157 9.7 1 284 375 29.2 909 70.8 Kwazulu-Natal DC43: Sisonke KZDMA43: Mkhomazi Wilderness Area 311 45 14.5 266 85.5 330 21 6.4 309 93.6 North West DC37: Bojanala NWDMA37: Pilansberg National Park 96 2 2.1 94 97.9 121 0 0.0 121 100.0 Gauteng CBDC8: West Rand GTDMA41: West Rand 971 344 35.4 627 64.6 2 009 78 3.9 1 931 96.1 Mpumalanga DC31: Nkangala MPDMA31: Mdala Nature Reserve 5 4 80.0 1 20.0 0 0 0.0 0 0.0 Mpumalanga DC32: Ehlanzeni MPDMA32: Lowveld 0 0 0.0 0 0.0 263 12 4.6 251 95.4 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBDMA3: Schuinsdraai Nature Reserve 9 4 44.4 5 55.6 0 0 0.0 0 0.0 Limpopo/ Mpumalanga CBDC4: Bohlabela CBDMA4: Kruger Park 538 92 17.1 446 82.9 2 294 24 1.0 2 270 99.0 5 841 979 1 710 624 29.3 4 131 355 70.7 7 479 935 1 642 125 22.0 5 837 810 78.0 Total Note: 0 (zero) households: information is not available PART III KEY HOUSEHOLD SERVICES INDICATORS 245 Table 14: Local municipalities: Access to sanitation, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number 246 2001 Without access With access % Number Total number of households % Without access Number With access % Number % Western Cape DC1: West Coast WC011: Matzikama 9 956 1 669 16.8 8 287 83.2 14 466 2 400 16.6 12 066 83.4 Western Cape DC1: West Coast WC012: Cederberg 7 803 1 798 23.0 6 005 77.0 11 182 1 721 15.4 9 461 84.6 Western Cape DC1: West Coast WC013: Bergrivier 8 886 1 024 11.5 7 862 88.5 13 295 943 7.1 12 352 92.9 Western Cape DC1: West Coast WC014: Saldanha Bay 12 791 709 5.5 12 082 94.5 18 889 533 2.8 18 356 97.2 Western Cape DC1: West Coast WC015: Swartland 15 889 1 332 8.4 14 557 91.6 18 667 1 934 10.4 16 733 89.6 Western Cape DC2: Boland WC022: Witzenberg 16 124 1 684 10.4 14 440 89.6 20 382 2 282 11.2 18 100 88.8 Western Cape DC2: Boland WC023: Drakenstein 42 245 3 272 7.7 38 973 92.3 46 216 4 459 9.6 41 757 90.4 Western Cape DC2: Boland WC024: Stellenbosch 26 186 2 682 10.2 23 504 89.8 34 773 2 866 8.2 31 907 91.8 Western Cape DC2: Boland WC025: Breede Valley 29 190 1 679 5.8 27 511 94.2 35 003 3 292 9.4 31 711 90.6 Western Cape DC2: Boland WC026: Breede River/Winelands 16 122 1 892 11.7 14 230 88.3 21 154 2 382 11.3 18 772 88.7 Western Cape DC3: Overberg Theewaterskloof 18 057 2 353 13.0 15 704 87.0 24 303 3 584 14.7 20 719 85.3 Western Cape DC3: Overberg WC032: Overstrand 11 412 1 240 10.9 10 172 89.1 19 057 1 502 7.9 17 555 92.1 Western Cape DC3: Overberg WC033: Cape Agulhas 5 595 686 12.3 4 909 87.7 7 544 758 10.0 6 786 90.0 Western Cape DC3: Overberg WC034: Swellendam 6 098 603 9.9 5 495 90.1 7 597 700 9.2 6 897 90.8 Western Cape DC4: Eden WC041: Kannaland 4 855 1 235 25.4 3 620 74.6 6 136 1 399 22.8 4 737 77.2 Western Cape DC4: Eden WC042: Langeberg 9 743 1 045 10.7 8 698 89.3 12 623 1 102 8.7 11 521 91.3 Western Cape DC4: Eden WC043: Mossel Bay 15 420 898 5.8 14 522 94.2 20 196 1 075 5.3 19 121 94.7 Western Cape DC4: Eden WC044: George 25 700 3 285 12.8 22 415 87.2 36 114 5 215 14.4 30 899 85.6 Western Cape DC4: Eden WC045: Oudtshoorn 15 734 2 920 18.6 12 814 81.4 18 312 2 374 13.0 15 938 87.0 Western Cape DC4: Eden WC047: Plettenberg Bay 5 075 376 7.4 4 699 92.6 8 920 1 042 11.7 7 878 88.3 Western Cape DC4: Eden WC048: Knysna 11 498 1 210 10.5 10 288 89.5 14 902 1 802 12.1 13 100 87.9 Western Cape DC5: Central Karoo WC051: Laingsburg 1 461 264 18.1 1 197 81.9 1 943 218 11.2 1 725 88.8 Western Cape DC5: Central Karoo WC052: Prince Albert 2 132 1 264 59.3 868 40.7 2 604 440 16.9 2 164 83.1 Western Cape DC5: Central Karoo WC053: Beaufort West 7 309 853 11.7 6 456 88.3 9 062 622 6.9 8 440 93.1 WC031: THE DBSA INFRASTRUCTURE BAROMETER Table 14: (continued) Local municipalities: Access to sanitation, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Without access Number % 2001 With access Number Total number of households % Without access Number % With access Number % Eastern Cape DC10: Cacadu EC101: Camdeboo 9 388 3 461 36.9 5 927 63.1 10 464 1 744 16.7 8 720 83.3 Eastern Cape DC10: Cacadu EC102 Blue Crane Route 8 001 4 180 52.2 3 821 47.8 9 538 3 546 37.2 5 992 62.8 Eastern Cape DC10: Cacadu EC103: Ikwezi 2 329 1 494 64.1 835 35.9 2 747 1 740 63.3 1 007 36.7 Eastern Cape DC10: Cacadu EC104: Makana 16 329 7 511 46.0 8 818 54.0 18 155 7 544 41.6 10 611 58.4 Eastern Cape DC10: Cacadu EC105: Ndlambe 11 668 1 384 11.9 10 284 88.1 15 917 2 358 14.8 13 559 85.2 Eastern Cape DC10: Cacadu EC106: Sunday’s River Valley 9 411 1 388 14.7 8 023 85.3 10 513 2 132 20.3 8 381 79.7 Eastern Cape DC10: Cacadu EC107: Baviaans 3 106 1 577 50.8 1 529 49.2 3 888 1 176 30.2 2 712 69.8 Eastern Cape DC10: Cacadu EC108: Kouga 14 552 3 199 22.0 11 353 78.0 19 521 4 822 24.7 14 699 75.3 Eastern Cape DC10: Cacadu EC109: Kou-Kamma 6 856 1 353 19.7 5 503 80.3 9 961 1 506 15.1 8 455 84.9 Eastern Cape DC12: Amatole EC121: Mbhashe 48 880 36 110 73.9 12 770 26.1 53 173 39 723 74.7 13 450 25.3 Eastern Cape DC12: Amatole EC122: Mnquma 60 052 32 898 54.8 27 154 45.2 67 858 36 925 54.4 30 933 45.6 Eastern Cape DC12: Amatole EC123: Great Kei 8 408 4 991 59.4 3 417 40.6 11 506 7 687 66.8 3 819 33.2 Eastern Cape DC12: Amatole EC124: Amahlathi 29 176 5 650 19.4 23 526 80.6 34 876 6 437 18.5 28 439 81.5 Eastern Cape DC12: Amatole EC125: Buffalo City 160 779 19 589 12.2 141 190 87.8 194 063 26 614 13.7 167 449 86.3 Eastern Cape DC12: Amatole EC126: Ngqushwa 20 620 2 493 12.1 18 127 87.9 21 892 3 113 14.2 18 779 85.8 Eastern Cape DC12: Amatole EC127: Nkonkobe 28 637 6 940 24.2 21 697 75.8 34 360 8 373 24.4 25 987 75.6 Eastern Cape DC12: Amatole EC128: Nxuba 5 434 3 668 67.5 1 766 32.5 6 634 3 862 58.2 2 772 41.8 Eastern Cape DC13: Chris Hani EC131: Inxuba Yethemba 13 064 5 169 39.6 7 895 60.4 16 048 4 151 25.9 11 897 74.1 Eastern Cape DC13: Chris Hani EC132: Tsolwana 7 754 4 569 58.9 3 185 41.1 7 934 4 139 52.2 3 795 47.8 Eastern Cape DC13: Chris Hani EC133: Inkwanca 4 270 2 913 68.2 1 357 31.8 5 477 2 652 48.4 2 825 51.6 Eastern Cape DC13: Chris Hani EC134: Lukanji 37 447 8 710 23.3 28 737 76.7 44 909 10 068 22.4 34 841 77.6 Eastern Cape DC13: Chris Hani EC135: Intsika Yethu 44 194 25 218 57.1 18 976 42.9 45 172 27 470 60.8 17 702 39.2 Eastern Cape DC13: Chris Hani EC136: Emalahleni 25 512 15 341 60.1 10 171 39.9 26 066 16 727 64.2 9 339 35.8 Eastern Cape DC13: Chris Hani EC137: Engcobo 28 423 19 128 67.3 9 295 32.7 31 425 21 361 68.0 10 064 32.0 PART III KEY HOUSEHOLD SERVICES INDICATORS 247 Table 14: (continued) Local municipalities: Access to sanitation, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number 248 2001 Without access With access % Number Total number of households % Without access Number With access % Number % Eastern Cape DC13: Chris Hani EC138: Sakhisizwe 10 016 2 532 25.3 7 484 74.7 12 719 4 135 32.5 8 584 67.5 Eastern Cape DC14: Ukhahlamba EC141: Elundini 29 585 16 671 56.3 12 914 43.7 33 786 19 144 56.7 14 642 43.3 Eastern Cape DC14: Ukhahlamba EC142: Senqu 27 923 12 483 44.7 15 440 55.3 34 052 14 632 43.0 19 420 57.0 Eastern Cape DC14: Ukhahlamba EC143: Maletswai 7 007 2 358 33.7 4 649 66.3 9 791 4 504 46.0 5 287 54.0 Eastern Cape DC14: Ukhahlamba EC144: Gariep 6 589 4 151 63.0 2 438 37.0 8 265 4 813 58.2 3 452 41.8 Eastern Cape DC15: O.R.Tambo EC151: Mbizana 41 891 15 563 37.2 26 328 62.8 46 340 18 335 39.6 28 005 60.4 Eastern Cape DC15: O.R.Tambo EC152: Ntabankulu 22 984 15 533 67.6 7 451 32.4 27 169 18 201 67.0 8 968 33.0 Eastern Cape DC15: O.R.Tambo EC153: Qaukeni 44 358 19 973 45.0 24 385 55.0 51 213 24 254 47.4 26 959 52.6 Eastern Cape DC15: O.R.Tambo EC154: Port St Johns 27 286 20 136 73.8 7 150 26.2 29 318 21 987 75.0 7 331 25.0 Eastern Cape DC15: O.R.Tambo EC155: Nyandeni 50 742 29 100 57.3 21 642 42.7 56 490 35 234 62.4 21 256 37.6 Eastern Cape DC15: O.R.Tambo EC156: Mhlontlo 39 076 20 407 52.2 18 669 47.8 42 910 22 557 52.6 20 353 47.4 Eastern Cape DC15: O.R.Tambo EC157: King Sabata Dalindyebo 80 611 36 684 45.5 43 927 54.5 90 248 41 479 46.0 48 769 54.0 Eastern Cape DC44: Alfred Nzo EC05b1: Umzimkhulu 31 517 2 878 9.1 28 639 90.9 36 642 3 408 9.3 33 234 90.7 Eastern Cape DC44: Alfred Nzo EC05b2: Umzimvubu 82 084 26 519 32.3 55 565 67.7 87 762 29 375 33.5 58 387 66.5 Northern Cape DC6: Namakwa NC061: Richtersveld 3 038 573 18.9 2 465 81.1 2 873 250 8.7 2 623 91.3 Northern Cape DC6: Namakwa NC062: Nama Khoi 9 688 3 978 41.1 5 710 58.9 12 064 2 751 22.8 9 313 77.2 Northern Cape DC6: Namakwa NC064: Kamiesberg 2 597 1 449 55.8 1 148 44.2 3 230 918 28.4 2 312 71.6 Northern Cape DC6: Namakwa NC065: Hantam 5 078 2 106 41.5 2 972 58.5 5 492 1 460 26.6 4 032 73.4 Northern Cape DC6: Namakwa NC066: Karoo Hoogland 3 276 1 611 49.2 1 665 50.8 3 146 1 334 42.4 1 812 57.6 Northern Cape DC6: Namakwa NC067: KhGi-Ma 2 223 619 27.8 1 604 72.2 3 344 625 18.7 2 719 81.3 Northern Cape DC7: Karoo NC071: Ubuntu 4 237 2 364 55.8 1 873 44.2 4 245 2 020 47.6 2 225 52.4 Northern Cape DC7: Karoo NC072: Umsombomvu 5 454 2 732 50.1 2 722 49.9 5 882 2 655 45.1 3 227 54.9 Northern Cape DC7: Karoo NC073: Emthanjeni 8 540 3 958 46.3 4 582 53.7 8 804 2 693 30.6 6 111 69.4 Northern Cape DC7: Karoo NC074: Kareeberg 2 733 1 332 48.7 1 401 51.3 2 424 1 110 45.8 1 314 54.2 THE DBSA INFRASTRUCTURE BAROMETER Table 14: (continued) Local municipalities: Access to sanitation, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Without access Number % 2001 With access Number Total number of households % Without access Number With access % Number % Northern Cape DC7: Karoo NC075: Renosterberg 2 372 1 270 53.5 1 102 46.5 2 464 1 117 45.3 1 347 54.7 Northern Cape DC7: Karoo NC076: Thembelihle 2 836 992 35.0 1 844 65.0 3 479 1 308 37.6 2 171 62.4 Northern Cape DC7: Karoo NC077: Siyathemba 4 546 1 537 33.8 3 009 66.2 4 166 1 054 25.3 3 112 74.7 Northern Cape DC7: Karoo NC078: Siyancuma 7 013 2 649 37.8 4 364 62.2 9 217 3 159 34.3 6 058 65.7 Northern Cape DC8: Siyanda NC081: Mier 1 315 638 48.5 677 51.5 1 575 673 42.7 902 57.3 Northern Cape DC8: Siyanda NC082: !Kai!Garib 11 087 3 118 28.1 7 969 71.9 18 485 3 402 18.4 15 083 81.6 Northern Cape DC8: Siyanda NC083: Khara Hais 15 462 2 390 15.5 13 072 84.5 17 186 2 405 14.0 14 781 86.0 Northern Cape DC8: Siyanda NC084: !Kheis 2 939 1 089 37.1 1 850 62.9 3 951 1 310 33.2 2 641 66.8 Northern Cape DC8: Siyanda NC085: Tsantsabane 6 544 1 489 22.8 5 055 77.2 7 357 1 309 17.8 6 048 82.2 Northern Cape DC8: Siyanda NC086: Kgatelopele 3 898 696 17.9 3 202 82.1 4 104 575 14.0 3 529 86.0 Northern Cape DC9: Frances Baard NC091: Sol Plaatje 45 155 6 061 13.4 39 094 86.6 51 005 6 709 13.2 44 296 86.8 Northern Cape DC9: Frances Baard NC092: Dikgatlong 7 663 4 318 56.3 3 345 43.7 9 722 3 611 37.1 6 111 62.9 Northern Cape DC9: Frances Baard NC093: Magareng 5 252 1 876 35.7 3 376 64.3 5 812 824 14.2 4 988 85.8 Northern Cape CBDC1: Kgalagadi NC01B1: Gamagara 4 185 720 17.2 3 465 82.8 5 137 307 6.0 4 830 94.0 Free State DC16: Xhariep FS161: Letsemeng 8 962 1 653 18.4 7 309 81.6 12 084 3 109 25.7 8 975 74.3 Free State DC16: Xhariep FS162: Kopanong 13 132 3 974 30.3 9 158 69.7 17 611 3 218 18.3 14 393 81.7 Free State DC16: Xhariep FS163: Mohokare 8 783 6 040 68.8 2 743 31.2 9 540 2 780 29.1 6 760 70.9 Free State DC17: Motheo FS171: Naledi 6 300 3 349 53.2 2 951 46.8 7 672 2 373 30.9 5 299 69.1 Free State DC17: Motheo FS172: Mangaung 153 408 36 610 23.9 116 798 76.1 188 656 47 984 25.4 140 672 74.6 Free State DC17: Motheo FS173: Mantsopa 11 506 5 235 45.5 6 271 54.5 14 070 7 014 49.9 7 056 50.1 Free State DC18: Lejweleputswa FS181: Masilonyana 15 032 9 509 63.3 5 523 36.7 20 490 11 575 56.5 8 915 43.5 Free State DC18: Lejweleputswa FS182: Tokologo 6 619 3 644 55.1 2 975 44.9 8 965 6 085 67.9 2 880 32.1 Free State DC18: Lejweleputswa FS183: Tswelopele 11 377 6 658 58.5 4 719 41.5 12 531 8 066 64.4 4 465 35.6 Free State DC18: Lejweleputswa FS184: Matjhabeng 110 705 29 449 26.6 81 256 73.4 128 640 32 528 25.3 96 112 74.7 PART III KEY HOUSEHOLD SERVICES INDICATORS 249 Table 14: (continued) Local municipalities: Access to sanitation, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number With access % Number Total number of households % Without access Number With access % Number % Free State DC18: Lejweleputswa FS185: Nala 18 476 8 623 46.7 9 853 53.3 25 985 15 389 59.2 10 596 40.8 Free State DC19: Thabo Mofutsanyane FS191: Setsoto 26 299 15 348 58.4 10 951 41.6 33 563 21 750 64.8 11 813 35.2 Free State DC19: Thabo Mofutsanyane FS192: Dihlabeng 25 459 6 034 23.7 19 425 76.3 33 402 10 714 32.1 22 688 67.9 Free State DC19: Thabo Mofutsanyane FS193: Nketoana 14 749 9 738 66.0 5 011 34.0 15 021 10 229 68.1 4 792 31.9 Free State DC19: Thabo Mofutsanyane FS194: Maluti a Phofung 80 792 5 749 7.1 75 043 92.9 92 102 5 208 5.7 86 894 94.3 Free State DC19: Thabo Mofutsanyane FS195: Phumelela 9 475 4 403 46.5 5 072 53.5 12 027 5 477 45.5 6 550 54.5 Free State DC20: Northern Free State FS201: Moqhaka 37 545 10 442 27.8 27 103 72.2 43 835 8 468 19.3 35 367 80.7 Free State DC20: Northern Free State FS203: Ngwathe 29 613 9 855 33.3 19 758 66.7 32 507 9 789 30.1 22 718 69.9 Free State DC20: Northern Free State FS204: Metsimaholo 25 669 5 101 19.9 20 568 80.1 33 701 4 976 14.8 28 725 85.2 Free State DC20: Northern Free State FS205: Mafube 12 319 4 572 37.1 7 747 62.9 14 783 4 939 33.4 9 844 66.6 Kwazulu-Natal DC21: Ugu KZ211: Vulamehlo 17 023 3 110 18.3 13 913 81.7 16 796 4 332 25.8 12 464 74.2 Kwazulu-Natal DC21: Ugu KZ212: Umdoni 12 659 764 6.0 11 895 94.0 16 468 1 573 9.6 14 895 90.4 Kwazulu-Natal DC21: Ugu KZ213: Umzumbe 27 885 4 524 16.2 23 361 83.8 38 871 7 035 18.1 31 836 81.9 Kwazulu-Natal DC21: Ugu KZ214: uMuziwabantu 14 305 2 273 15.9 12 032 84.1 19 502 3 194 16.4 16 308 83.6 Kwazulu-Natal DC21: Ugu KZ215: Ezingoleni 8 058 2 247 27.9 5 811 72.1 11 428 3 984 34.9 7 444 65.1 Kwazulu-Natal DC21: Ugu KZ216: Hibiscus Coast 42 458 4 182 9.8 38 276 90.2 55 232 8 714 15.8 46 518 84.2 Kwazulu-Natal DC22: KZ221: uMshwathi 25 144 4 550 18.1 20 594 81.9 27 192 4 401 16.2 22 791 83.8 KZ222: uMngeni 15 771 820 5.2 14 951 94.8 22 659 993 4.4 21 666 95.6 KZ223: Mooi Mpofana 4 567 1 089 23.8 3 478 76.2 10 496 2 584 24.6 7 912 75.4 KZ224: Impendle 6 040 140 2.3 5 900 97.7 7 456 351 4.7 7 105 95.3 KZ225: Msunduzi 117 519 2 037 1.7 115 482 98.3 135 180 4 172 3.1 131 008 96.9 8 949 2 404 26.9 6 545 73.1 15 414 3 205 20.8 12 209 79.2 UMgungundlovu Kwazulu-Natal DC22: UMgungundlovu Kwazulu-Natal DC22: UMgungundlovu Kwazulu-Natal DC22: UMgungundlovu Kwazulu-Natal DC22: UMgungundlovu Kwazulu-Natal DC22: UMgungundlovu Kwazulu-Natal Kwazulu-Natal 250 2001 Without access DC22: KZ226: Mkhambathini UMgungundlovu KZ227: Richmond 12 266 868 7.1 11 398 92.9 16 000 1 312 8.2 14 688 91.8 DC23: Uthukela KZ232: Ladysmith 33 900 2 883 8.5 31 017 91.5 51 877 5 136 9.9 46 741 90.1 THE DBSA INFRASTRUCTURE BAROMETER Table 14: (continued) Local municipalities: Access to sanitation, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number Kwazulu-Natal DC23: Uthukela KZ233: Indaka Kwazulu-Natal DC23: Uthukela KZ234: Umtshezi Kwazulu-Natal DC23: Uthukela Kwazulu-Natal 2001 Without access With access % Number Total number of households % Without access Number With access % Number % 15 043 8 350 55.5 6 693 44.5 21 471 8 460 39.4 13 011 60.6 9 038 1 655 18.3 7 383 81.7 13 952 3 145 22.5 10 807 77.5 KZ235: Okhahlamba 19 441 3 192 16.4 16 249 83.6 27 925 6 950 24.9 20 975 75.1 DC23: Uthukela KZ236: Imbabazane 17 569 3 258 18.5 14 311 81.5 23 271 2 930 12.6 20 341 87.4 Kwazulu-Natal DC24: Umzinyathi KZ241: Endumeni 9 279 609 6.6 8 670 93.4 13 107 950 7.2 12 157 92.8 Kwazulu-Natal DC24: Umzinyathi KZ242: Nqutu 19 873 8 474 42.6 11 399 57.4 25 965 9 828 37.9 16 137 62.1 Kwazulu-Natal DC24: Umzinyathi KZ244: Msinga 27 564 20 921 75.9 6 643 24.1 32 881 23 232 70.7 9 649 29.3 Kwazulu-Natal DC24: Umzinyathi KZ245: Umvoti 18 660 4 878 26.1 13 782 73.9 22 948 6 688 29.1 16 260 70.9 Kwazulu-Natal DC25: Amajuba KZ252: Newcastle 55 291 1 372 2.5 53 919 97.5 71 922 3 293 4.6 68 629 95.4 Kwazulu-Natal DC25: Amajuba KZ253: Utrecht 3 496 1 630 46.6 1 866 53.4 6 660 2 577 38.7 4 083 61.3 Kwazulu-Natal DC25: Amajuba KZ254: Dannhauser 15 575 604 3.9 14 971 96.1 19 471 1 380 7.1 18 091 92.9 Kwazulu-Natal DC26: Zululand KZ261: eDumbe 10 199 3 660 35.9 6 539 64.1 15 812 4 917 31.1 10 895 68.9 Kwazulu-Natal DC26: Zululand KZ262: uPhongolo 15 988 7 095 44.4 8 893 55.6 26 938 12 369 45.9 14 569 54.1 Kwazulu-Natal DC26: Zululand KZ263: Abaqulusi 27 362 6 091 22.3 21 271 77.7 37 017 10 078 27.2 26 939 72.8 Kwazulu-Natal DC26: Zululand KZ265: Nongoma 26 170 15 164 57.9 11 006 42.1 32 436 18 173 56.0 14 263 44.0 Kwazulu-Natal DC26: Zululand KZ266: Ulundi 27 862 7 421 26.6 20 441 73.4 38 647 14 349 37.1 24 298 62.9 Kwazulu-Natal DC27: Umkhanyakude KZ271: Umhlabuyalingana 18 770 13 406 71.4 5 364 28.6 26 660 18 481 69.3 8 179 30.7 Kwazulu-Natal DC27: Umkhanyakude KZ272: Jozini 22 126 16 547 74.8 5 579 25.2 34 738 21 851 62.9 12 887 37.1 Kwazulu-Natal DC27: Umkhanyakude KZ273: The Big 5 False Bay 3 739 2 920 78.1 819 21.9 7 070 3 847 54.4 3 223 45.6 Kwazulu-Natal DC27: Umkhanyakude KZ274: Hlabisa 21 855 11 910 54.5 9 945 45.5 27 267 13 344 48.9 13 923 51.1 Kwazulu-Natal DC27: Umkhanyakude KZ275: Mtubatuba 5 106 1 511 29.6 3 595 70.4 8 636 1 815 21.0 6 821 79.0 Kwazulu-Natal DC28: Uthungulu KZ281: Mbonambi 14 080 6 471 46.0 7 609 54.0 20 435 8 598 42.1 11 837 57.9 Kwazulu-Natal DC28: Uthungulu KZ282: uMhlathuze 38 375 3 725 9.7 34 650 90.3 73 234 7 052 9.6 66 182 90.4 Kwazulu-Natal DC28: Uthungulu KZ283: Ntambanana 10 270 5 737 55.9 4 533 44.1 13 828 7 127 51.5 6 701 48.5 PART III KEY HOUSEHOLD SERVICES INDICATORS 251 Table 14: (continued)Local municipalities: Access to sanitation, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number 252 Kwazulu-Natal DC28: Uthungulu KZ284: uMlalazi Kwazulu-Natal DC28: Uthungulu KZ285: Mthonjaneni Kwazulu-Natal DC28: Uthungulu Kwazulu-Natal 2001 Without access With access % Number Total number of households % Without access Number With access % Number % 35 421 16 544 46.7 18 877 53.3 44 599 19 973 44.8 24 626 55.2 5 301 1 987 37.5 3 314 62.5 12 647 2 899 22.9 9 748 77.1 KZ286: Nkandla 19 509 9 136 46.8 10 373 53.2 24 867 10 682 43.0 14 185 57.0 DC29: iLembe KZ291: eNdondakusuka 24 479 6 615 27.0 17 864 73.0 31 001 4 713 15.2 26 288 84.8 Kwazulu-Natal DC29: iLembe KZ292: KwaDukuza 36 841 6 777 18.4 30 064 81.6 45 897 6 922 15.1 38 975 84.9 Kwazulu-Natal DC29: iLembe KZ293: Ndwedwe 25 452 6 804 26.7 18 648 73.3 30 631 7 604 24.8 23 027 75.2 Kwazulu-Natal DC29: iLembe KZ294: Maphumulo 21 402 7 843 36.6 13 559 63.4 22 391 7 215 32.2 15 176 67.8 Kwazulu-Natal DC43: Sisonke KZ5a1: Ingwe 17 445 2 270 13.0 15 175 87.0 21 927 2 443 11.1 19 484 88.9 Kwazulu-Natal DC43: Sisonke KZ5a2: Kwa Sani 3 632 140 3.9 3 492 96.1 4 656 231 5.0 4 425 95.0 Kwazulu-Natal DC43: Sisonke KZ5a3: Matatiele 2 497 399 16.0 2 098 84.0 5 705 485 8.5 5 220 91.5 Kwazulu-Natal DC43: Sisonke KZ5a4: Greater Kokstad 8 729 1 689 19.3 7 040 80.7 20 534 3 288 16.0 17 246 84.0 Kwazulu-Natal DC43: Sisonke KZ5a5: Ubuhlebezwe 15 188 1 540 10.1 13 648 89.9 23 088 3 323 14.4 19 765 85.6 North West DC37: Bojanala NW371: Moretele 32 669 527 1.6 32 142 98.4 43 168 1 080 2.5 42 088 97.5 North West DC37: Bojanala NW372: Madibeng 76 065 4 198 5.5 71 867 94.5 97 226 9 610 9.9 87 616 90.1 North West DC37: Bojanala NW373: Rustenburg 75 722 6 181 8.2 69 541 91.8 119 582 16 206 13.6 103 376 86.4 North West DC37: Bojanala NW374: Kgetlengrivier 7 718 2 393 31.0 5 325 69.0 10 483 1 758 16.8 8 725 83.2 North West DC37: Bojanala NW375: Moses Kotane 49 137 2 309 4.7 46 828 95.3 62 712 3 799 6.1 58 913 93.9 North West DC38: Central NW381: Setla-Kgobi 17 642 1 392 7.9 16 250 92.1 22 714 3 670 16.2 19 044 83.8 North West DC38: Central NW382: Tswaing 17 687 4 314 24.4 13 373 75.6 25 624 4 882 19.1 20 742 80.9 North West DC38: Central NW383: Mafikeng 51 658 2 033 3.9 49 625 96.1 67 505 3 635 5.4 63 870 94.6 North West DC38: Central NW384: Ditsobotla 26 611 5 032 18.9 21 579 81.1 36 387 6 356 17.5 30 031 82.5 North West DC38: Central NW385: Zeerust 24 292 1 634 6.7 22 658 93.3 32 364 3 113 9.6 29 251 90.4 North West DC39: Bophirima NW391: Kagisano 18 871 4 304 22.8 14 567 77.2 23 391 5 805 24.8 17 586 75.2 North West DC39: Bophirima NW392: Naledi 12 414 1 576 12.7 10 838 87.3 15 222 2 895 19.0 12 327 81.0 THE DBSA INFRASTRUCTURE BAROMETER Table 14: (continued) Local municipalities: Access to sanitation, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number North West DC39: Bophirima NW393: Mamusa North West DC39: Bophirima NW394: Greater Taung North West DC39: Bophirima North West 2001 Without access With access % Number Total number of households % Without access Number With access % Number % 9 142 3 361 36.8 5 781 63.2 10 748 5 905 54.9 4 843 45.1 35 663 4 715 13.2 30 948 86.8 41 994 5 791 13.8 36 203 86.2 NW395: Molopo 3 584 852 23.8 2 732 76.2 3 791 1 817 47.9 1 974 52.1 DC39: Bophirima NW396: Lekwa-Teemane 7 776 4 691 60.3 3 085 39.7 11 570 3 244 28.0 8 326 72.0 North West DC40: Southern NW401: Ventersdorp 6 860 2 564 37.4 4 296 62.6 11 428 1 745 15.3 9 683 84.7 North West DC40: Southern NW402: Potchefstroom 29 089 2 879 9.9 26 210 90.1 33 963 3 669 10.8 30 294 89.2 North West DC40: Southern NW403: Klerksdorp 77 825 25 532 32.8 52 293 67.2 112 023 27 611 24.6 84 412 75.4 North West DC40: Southern NW404: Maquassi Hills 12 815 7 845 61.2 4 970 38.8 17 292 8 720 50.4 8 572 49.6 North West CBDC1: Kgalagadi NW1a1: Moshaweng 16 176 3 376 20.9 12 800 79.1 18 370 5 209 28.4 13 161 71.6 Gauteng CBDC2: Metsweding GT02b1: Nokeng tsa Taemane 11 149 581 5.2 10 568 94.8 16 405 1 868 11.4 14 537 88.6 Gauteng CBDC8: West Rand GT411: Mogale City 61 551 2 380 3.9 59 171 96.1 89 496 6 000 6.7 83 496 93.3 Gauteng CBDC8: West Rand GT412: Randfontein 27 504 1 184 4.3 26 320 95.7 40 471 1 611 4.0 38 860 96.0 Gauteng CBDC8: West Rand GT414: Westonaria 23 219 5 301 22.8 17 918 77.2 51 488 5 339 10.4 46 149 89.6 Gauteng DC42: Sedibeng GT421: Emfuleni 148 889 3 864 2.6 145 025 97.4 190 157 5 885 3.1 184 272 96.9 Gauteng DC42: Sedibeng GT422: Midvaal 17 726 996 5.6 16 730 94.4 20 832 1 674 8.0 19 158 92.0 Gauteng DC42: Sedibeng GT423: Lesedi 15 501 3 539 22.8 11 962 77.2 19 001 3 131 16.5 15 870 83.5 Mpumalanga DC30: Gert Sibande MP301: Albert Luthuli 35 486 4 069 11.5 31 417 88.5 41 194 4 695 11.4 36 499 88.6 Mpumalanga DC30: Gert Sibande MP302: Msukaligwa 25 029 4 959 19.8 20 070 80.2 30 263 3 346 11.1 26 917 88.9 Mpumalanga DC30: Gert Sibande MP303: Mkhondo 18 816 5 480 29.1 13 336 70.9 28 899 7 276 25.2 21 623 74.8 Mpumalanga DC30: Gert Sibande MP304: Seme 14 560 3 856 26.5 10 704 73.5 18 394 2 929 15.9 15 465 84.1 Mpumalanga DC30: Gert Sibande MP305: Lekwa 20 479 4 701 23.0 15 778 77.0 26 172 7 105 27.1 19 067 72.9 Mpumalanga DC30: Gert Sibande MP306: Dipaleseng 9 454 3 100 32.8 6 354 67.2 9 572 2 577 26.9 6 995 73.1 Mpumalanga DC30: Gert Sibande MP307: Govan Mbeki 49 675 9 122 18.4 40 553 81.6 67 581 12 439 18.4 55 142 81.6 Mpumalanga DC31: Nkangala MP311: Delmas 12 355 1 537 12.4 10 818 87.6 13 952 1 660 11.9 12 292 88.1 PART III KEY HOUSEHOLD SERVICES INDICATORS 253 Table 14: (continued) Local municipalities: Access to sanitation, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number 254 2001 Without access With access % Number Total number of households % Without access Number With access % Number % Mpumalanga DC31: Nkangala MP312: Emalahleni 56 469 3 478 6.2 52 991 93.8 82 241 6 581 8.0 75 660 92.0 Mpumalanga DC31: Nkangala MP313: Middelburg 33 644 2 872 8.5 30 772 91.5 37 041 2 909 7.9 34 132 92.1 Mpumalanga DC31: Nkangala MP314: Highlands 9 302 1 571 16.9 7 731 83.1 10 899 1 575 14.5 9 324 85.5 Mpumalanga DC31: Nkangala MP315: Thembisile 48 099 1 264 2.6 46 835 97.4 58 803 1 702 2.9 57 101 97.1 Mpumalanga DC31: Nkangala MP316: Dr JS Moroka 48 347 2 176 4.5 46 171 95.5 54 328 1 395 2.6 52 933 97.4 Mpumalanga DC32: Ehlanzeni MP321: Thaba Chweu 20 128 1 205 6.0 18 923 94.0 26 559 1 456 5.5 25 103 94.5 Mpumalanga DC32: Ehlanzeni MP322: Mbombela 91 615 6 860 7.5 84 755 92.5 121 950 14 288 11.7 107 662 88.3 Mpumalanga DC32: Ehlanzeni MP323: Umjindi 11 681 2 683 23.0 8 998 77.0 15 855 1 959 12.4 13 896 87.6 Mpumalanga DC32: Ehlanzeni MP324: Nkomazi 53 105 15 338 28.9 37 767 71.1 75 555 22 091 29.2 53 464 70.8 Limpopo DC33: Mopani NP331: Greater Giyani 42 183 23 984 56.9 18 199 43.1 52 861 29 314 55.5 23 547 44.5 Limpopo DC33: Mopani NP332: Greater Letaba 41 465 9 801 23.6 31 664 76.4 53 735 16 266 30.3 37 469 69.7 Limpopo DC33: Mopani NP333: Greater Tzaneen 73 898 16 708 22.6 57 190 77.4 97 376 24 952 25.6 72 424 74.4 Limpopo DC33: Mopani NP334: Ba-Phalaborwa 25 577 9 299 36.4 16 278 63.6 33 532 12 581 37.5 20 951 62.5 Limpopo DC34: Vhembe NP341: Musina 8 401 1 246 14.8 7 155 85.2 13 955 4 279 30.7 9 676 69.3 Limpopo DC34: Vhembe NP342: Mutale 13 113 5 573 42.5 7 540 57.5 17 644 7 813 44.3 9 831 55.7 Limpopo DC34: Vhembe NP343: Thulamela 101 760 31 196 30.7 70 564 69.3 129 155 40 402 31.3 88 753 68.7 Limpopo DC34: Vhembe NP344: Makhado 88 977 11 263 12.7 77 714 87.3 113 525 19 506 17.2 94 019 82.8 Limpopo DC35: Capricorn NP351: Blouberg 28 016 12 245 43.7 15 771 56.3 35 166 13 502 38.4 21 664 61.6 Limpopo DC35: Capricorn NP352: Aganang 27 584 5 704 20.7 21 880 79.3 32 523 6 746 20.7 25 777 79.3 Limpopo DC35: Capricorn NP353: Molemole 22 668 3 223 14.2 19 445 85.8 28 926 5 277 18.2 23 649 81.8 Limpopo DC35: Capricorn NP354: Polokwane 85 611 9 896 11.6 75 715 88.4 135 434 18 673 13.8 116 761 86.2 Limpopo DC35: Capricorn NP355: Lepele-Nkumpi 44 373 6 095 13.7 38 278 86.3 52 904 6 150 11.6 46 754 88.4 Limpopo DC36: Waterberg NP361: Thabazimbi 14 466 1 957 13.5 12 509 86.5 25 021 5 243 21.0 19 778 79.0 Limpopo DC36: Waterberg NP362: Lephalale 21 218 3 987 18.8 17 231 81.2 28 336 5 388 19.0 22 948 81.0 THE DBSA INFRASTRUCTURE BAROMETER Table 14: (continued) Local municipalities: Access to sanitation, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number Limpopo DC36: Waterberg NP364: Mookgopong Limpopo DC36: Waterberg Limpopo 2001 Without access With access % Number Total number of households % Without access Number With access % Number % 5 019 637 12.7 4 382 87.3 9 563 1 264 13.2 8 299 86.8 NP365: Modimolle 12 031 1 533 12.7 10 498 87.3 20 934 3 904 18.6 17 030 81.4 DC36: Waterberg NP366: Bela-Bela 11 165 815 7.3 10 350 92.7 14 160 1 457 10.3 12 703 89.7 Limpopo DC36: Waterberg NP367: Mogalakwena 53 716 4 238 7.9 49 478 92.1 70 081 7 977 11.4 62 104 88.6 Limpopo CBDC3: Sekhukhune Makhuduthamaga 49 943 9 966 20.0 39 977 80.0 54 203 8 905 16.4 45 298 83.6 Limpopo CBDC3: Sekhukhune NP03A3: Fetakgomo 17 360 6 713 38.7 10 647 61.3 19 001 5 043 26.5 13 958 73.5 Limpopo CBDC4: Bohlabela NP04A1: Maruleng 18 364 7 835 42.7 10 529 57.3 23 032 8 270 35.9 14 762 64.1 Northern Cape/ North West CBDC1: Kgalagadi CBLC1: Ga-Segonyana 13 174 1 890 14.3 11 284 85.7 17 761 3 436 19.3 14 325 80.7 Gauteng/ Mpumalanga CBDC2: Metsweding CBLC2: Kungwini 18 244 1 127 6.2 17 117 93.8 33 558 3 772 11.2 29 786 88.8 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBLC3: Greater Marble Hall 19 388 2 093 10.8 17 295 89.2 26 539 3 554 13.4 22 985 86.6 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBLC4: Greater Groblersdal 42 245 3 310 7.8 38 935 92.2 48 747 3 604 7.4 45 143 92.6 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBLC5: Greater Tubatse 42 526 14 308 33.6 28 218 66.4 56 217 14 883 26.5 41 334 73.5 Limpopo/ Mpumalanga CBDC4: Bohlabela CBLC6: Bushbuckridge 112 986 18 105 16.0 94 881 84.0 109 666 24 987 22.8 84 679 77.2 Northern Cape/ North West DC9: Frances Baard CBLC7: Phokwane 13 406 1 881 14.0 11 525 86.0 17 077 2 360 13.8 14 717 86.2 North West/ Gauteng CBDC8: West Rand CBLC8: Merafong City 39 801 3 140 7.9 36 661 92.1 99 652 4 100 4.1 95 552 95.9 Western Cape DC1: West Coast WCDMA01: West Coast 1 097 577 52.6 520 47.4 1 178 530 45.0 648 55.0 Western Cape DC2: Boland WCDMA02: Breede River 1 594 492 30.9 1 102 69.1 1 932 308 15.9 1 624 84.1 Western Cape DC3: Overberg WCDMA03: Overberg 12 0 0.0 12 100.0 80 3 3.8 77 96.3 Western Cape DC4: Eden WCDMA04: South Cape 2 875 1 162 40.4 1 713 59.6 3 549 906 25.5 2 643 74.5 Western Cape DC5: Central Karoo WCDMA05: Central Karoo 1 558 915 58.7 643 41.3 1 568 255 16.3 1 313 83.7 Eastern Cape DC10: Cacadu ECDMA10: Aberdeen Plain 1 942 778 40.1 1 164 59.9 2 016 590 29.3 1 426 70.7 Eastern Cape DC13: Chris Hani ECDMA13: Mountain Zebra National Park 22 0 0.0 22 100.0 18 0 0.0 18 100.0 Eastern Cape DC14: Ukhahlamba ECDMA14: Oviston Nature Reserve 0 0 0.0 0 0.0 3 0 0.0 3 100.0 Eastern Cape DC44: Alfred Nzo ECDMA44: O’Conners Camp 0 0 0.0 0 0.0 0 0 0.0 0 0.0 NP03A2 PART III KEY HOUSEHOLD SERVICES INDICATORS 255 Table 14: (continued) Local municipalities: Access to sanitation, 1996 and 2001 1996 Province District Municipality Local Municipality Total number of households Number Northern Cape DC6: Namakwa NCDMA06: Namaqualand Northern Cape DC7: Karoo Northern Cape 2001 Without access With access % Number Total number of households % Number With access % Number % 564 167 29.6 397 70.4 342 119 34.8 223 65.2 NCDMA07: Bo Karoo 1 290 505 39.1 785 60.9 1 097 559 51.0 538 49.0 DC8: Siyanda NCDMA08: Benede Oranje 2 540 937 36.9 1 603 63.1 3 241 782 24.1 2 459 75.9 Northern Cape DC9: Frances Baard NCDMA09: Diamondfields 1 076 628 58.4 448 41.6 1 612 660 40.9 952 59.1 Northern Cape CBDC1: Kgalagadi NCDMACB1: Kalahari 1 882 336 17.9 1 546 82.1 2 489 247 9.9 2 242 90.1 Free State DC19: Thabo Mofutsanyane FSDMA19: Golden Gate Highlands National Park 119 5 4.2 114 95.8 59 0 0.0 59 100.0 DC22: UMgungundlovu KZDMA22: Highmoor/ Kamberg Park 152 5 3.3 147 96.7 12 0 0.0 12 100.0 Kwazulu-Natal DC23: Uthukela KZDMA23: Gaints Castle Game Reserve 75 8 10.7 67 89.3 217 0 0.0 217 100.0 Kwazulu-Natal DC27: Umkhanyakude KZDMA27: St Lucia Park 1 612 1 101 68.3 511 31.7 1 284 419 32.6 865 67.4 Kwazulu-Natal DC43: Sisonke KZDMA43: Mkhomazi Wilderness Area 311 8 2.6 303 97.4 330 15 4.5 315 95.5 North West DC37: Bojanala NWDMA37: Pilansberg National Park 96 3 3.1 93 96.9 121 3 2.5 118 97.5 Gauteng CBDC8: West Rand GTDMA41: West Rand 971 83 8.5 888 91.5 2 011 108 5.4 1 903 94.6 Mpumalanga DC31: Nkangala MPDMA31: Mdala Nature Reserve 5 0 0.0 5 100.0 0 0 0.0 0 0.0 Mpumalanga DC32: Ehlanzeni MPDMA32: Lowveld 0 0 0.0 0 0.0 263 12 4.6 251 95.4 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBDMA3: Schuinsdraai Nature Reserve 9 0 0.0 9 100.0 0 0 0.0 0 0.0 Limpopo/ Mpumalanga CBDC4: Bohlabela CBDMA4: Kruger Park 538 103 19.1 435 80.9 2 294 39 1.7 2 255 98.3 5 841 979 1 387 087 23.7 4 454 892 76.3 7 479 961 1 717 195 23.0 5 762 766 77.0 Kwazulu-Natal Total Note: 0 (zero) households: information is not available 256 Without access THE DBSA INFRASTRUCTURE BAROMETER Table 15: Local municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households Not utilising electricity Number 2001 Utilising electricity % Number Total number of households % Not utilising electricity Number Utilising electricity % Number % Western Cape DC1: West Coast WC011: Matzikama 9 956 2 194 22.0 7 762 78.0 14 465 2 363 16.3 12 102 83.7 Western Cape DC1: West Coast WC012: Cederberg 7 803 1 887 24.2 5 916 75.8 11 182 1 842 16.5 9 340 83.5 Western Cape DC1: West Coast WC013: Bergrivier 8 886 1 637 18.4 7 249 81.6 13 295 1 155 8.7 12 140 91.3 Western Cape DC1: West Coast WC014: Saldanha Bay 12 791 1 842 14.4 10 949 85.6 18 888 1 595 8.4 17 293 91.6 Western Cape DC1: West Coast WC015: Swartland 15 889 2 178 13.7 13 711 86.3 18 666 1 642 8.8 17 024 91.2 Western Cape DC2: Boland WC022: Witzenberg 16 124 3 261 20.2 12 863 79.8 20 382 3 080 15.1 17 302 84.9 Western Cape DC2: Boland WC023: Drakenstein 42 245 6 983 16.5 35 262 83.5 46 216 5 819 12.6 40 397 87.4 Western Cape DC2: Boland WC024: Stellenbosch 26 186 2 910 11.1 23 276 88.9 34 772 2 785 8.0 31 987 92.0 Western Cape DC2: Boland WC025: Breede Valley 29 190 3 209 11.0 25 981 89.0 35 004 3 681 10.5 31 323 89.5 Western Cape DC2: Boland WC026: Breede River/Winelands 16 122 3 099 19.2 13 023 80.8 21 154 2 377 11.2 18 777 88.8 Western Cape DC3: Overberg WC031: Theewaterskloof 18 057 2 953 16.4 15 104 83.6 24 303 4 727 19.5 19 576 80.5 Western Cape DC3: Overberg WC032: Overstrand 11 412 1 924 16.9 9 488 83.1 19 056 3 184 16.7 15 872 83.3 Western Cape DC3: Overberg WC033: Cape Agulhas 5 595 819 14.6 4 776 85.4 7 545 654 8.7 6 891 91.3 Western Cape DC3: Overberg WC034: Swellendam 6 098 1 498 24.6 4 600 75.4 7 597 889 11.7 6 708 88.3 Western Cape DC4: Eden WC041: Kannaland 4 855 1 415 29.1 3 440 70.9 6 136 1 161 18.9 4 975 81.1 Western Cape DC4: Eden WC042: Langeberg 9 743 2 552 26.2 7 191 73.8 12 625 1 764 14.0 10 861 86.0 Western Cape DC4: Eden WC043: Mossel Bay 15 420 1 848 12.0 13 572 88.0 20 195 1 811 9.0 18 384 91.0 Western Cape DC4: Eden WC044: George 25 700 4 387 17.1 21 313 82.9 36 114 4 834 13.4 31 280 86.6 Western Cape DC4: Eden WC045: Oudtshoorn 15 734 3 051 19.4 12 683 80.6 18 309 2 715 14.8 15 594 85.2 Western Cape DC4: Eden WC047: Plettenberg Bay 5 075 1 321 26.0 3 754 74.0 8 919 1 680 18.8 7 239 81.2 Western Cape DC4: Eden WC048: Knysna 11 498 3 723 32.4 7 775 67.6 14 901 2 920 19.6 11 981 80.4 Western Cape DC5: Central Karoo WC051: Laingsburg 1 461 492 33.7 969 66.3 1 942 452 23.3 1 490 76.7 Western Cape DC5: Central Karoo WC052: Prince Albert 2 132 620 29.1 1 512 70.9 2 602 465 17.9 2 137 82.1 Western Cape DC5: Central Karoo WC053: Beaufort West 7 309 1 197 16.4 6 112 83.6 9 063 1 024 11.3 8 039 88.7 PART III KEY HOUSEHOLD SERVICES INDICATORS 257 Table 15: (continued) Local municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households Not utilising electricity Number 258 2001 Utilising electricity % Number Total number of households % Not utilising electricity Number Utilising electricity % Number % Eastern Cape DC10: Cacadu EC101: Camdeboo 9 388 2 232 23.8 7 156 76.2 10 466 1 559 14.9 8 907 85.1 Eastern Cape DC10: Cacadu EC102:Blue Crane Route 8 001 4 521 56.5 3 480 43.5 9 539 3 297 34.6 6 242 65.4 Eastern Cape DC10: Cacadu EC103: Ikwezi 2 329 852 36.6 1 477 63.4 2 747 747 27.2 2 000 72.8 Eastern Cape DC10: Cacadu EC104: Makana 16 329 4 625 28.3 11 704 71.7 18 155 4 855 26.7 13 300 73.3 Eastern Cape DC10: Cacadu EC105: Ndlambe 11 668 4 586 39.3 7 082 60.7 15 917 5 330 33.5 10 587 66.5 Eastern Cape DC10: Cacadu EC106: Sunday’s River Valley 9 411 3 410 36.2 6 001 63.8 10 514 3 622 34.4 6 892 65.6 Eastern Cape DC10: Cacadu EC107: Baviaans 3 106 1 748 56.3 1 358 43.7 3 887 1 164 29.9 2 723 70.1 Eastern Cape DC10: Cacadu EC108: Kouga 14 552 3 919 26.9 10 633 73.1 19 521 4 692 24.0 14 829 76.0 Eastern Cape DC10: Cacadu EC109: Kou-Kamma 6 856 2 542 37.1 4 314 62.9 9 961 2 378 23.9 7 583 76.1 Eastern Cape DC12: Amatole EC121: Mbhashe 48 880 46 814 95.8 2 066 4.2 53 173 44 691 84.0 8 482 16.0 Eastern Cape DC12: Amatole EC122: Mnquma 60 052 52 218 87.0 7 834 13.0 67 858 45 070 66.4 22 788 33.6 Eastern Cape DC12: Amatole EC123: Great Kei 8 408 6 137 73.0 2 271 27.0 11 507 3 302 28.7 8 205 71.3 Eastern Cape DC12: Amatole EC124: Amahlathi 29 176 22 304 76.4 6 872 23.6 34 875 11 276 32.3 23 599 67.7 Eastern Cape DC12: Amatole EC125: Buffalo City 160 779 85 533 53.2 75 246 46.8 194 062 71 168 36.7 122 894 63.3 Eastern Cape DC12: Amatole EC126: Ngqushwa 20 620 15 852 76.9 4 768 23.1 21 891 6 837 31.2 15 054 68.8 Eastern Cape DC12: Amatole EC127: Nkonkobe 28 637 22 258 77.7 6 379 22.3 34 361 8 046 23.4 26 315 76.6 Eastern Cape DC12: Amatole EC128: Nxuba 5 434 3 511 64.6 1 923 35.4 6 634 1 345 20.3 5 289 79.7 Eastern Cape DC13: Chris Hani EC131: Inxuba Yethemba 13 064 4 392 33.6 8 672 66.4 16 049 2 770 17.3 13 279 82.7 Eastern Cape DC13: Chris Hani EC132: Tsolwana 7 754 4 238 54.7 3 516 45.3 7 933 1 014 12.8 6 919 87.2 Eastern Cape DC13: Chris Hani EC133: Inkwanca 4 270 966 22.6 3 304 77.4 5 477 1 487 27.1 3 990 72.9 Eastern Cape DC13: Chris Hani EC134: Lukanji 37 447 16 540 44.2 20 907 55.8 44 908 12 381 27.6 32 527 72.4 Eastern Cape DC13: Chris Hani EC135: Intsika Yethu 44 194 42 030 95.1 2 164 4.9 45 171 31 296 69.3 13 875 30.7 Eastern Cape DC13: Chris Hani EC136: Emalahleni 25 512 20 318 79.6 5 194 20.4 26 066 13 778 52.9 12 288 47.1 Eastern Cape DC13: Chris Hani EC137: Engcobo 28 423 26 857 94.5 1 566 5.5 31 424 25 054 79.7 6 370 20.3 THE DBSA INFRASTRUCTURE BAROMETER Table 15: (continued) Local municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households Not utilising electricity Number 2001 Utilising electricity % Number Total number of households % Not utilising electricity Number Utilising electricity % Number % Eastern Cape DC13: Chris Hani EC138: Sakhisizwe 10 016 7 509 75.0 2 507 25.0 12 719 5 384 42.3 7 335 57.7 Eastern Cape DC14: Ukhahlamba EC141: Elundini 29 585 27 212 92.0 2 373 8.0 33 785 29 506 87.3 4 279 12.7 Eastern Cape DC14: Ukhahlamba EC142: Senqu 27 923 19 809 70.9 8 114 29.1 34 054 12 773 37.5 21 281 62.5 Eastern Cape DC14: Ukhahlamba EC143: Maletswai 7 007 3 298 47.1 3 709 52.9 9 791 4 210 43.0 5 581 57.0 Eastern Cape DC14: Ukhahlamba EC144: Gariep 6 589 1 832 27.8 4 757 72.2 8 266 2 040 24.7 6 226 75.3 Eastern Cape DC15: O.R.Tambo EC151: Mbizana 41 891 38 777 92.6 3 114 7.4 46 340 34 291 74.0 12 049 26.0 Eastern Cape DC15: O.R.Tambo EC152: Ntabankulu 22 984 22 252 96.8 732 3.2 27 170 22 994 84.6 4 176 15.4 Eastern Cape DC15: O.R.Tambo EC153: Qaukeni 44 358 43 071 97.1 1 287 2.9 51 213 43 771 85.5 7 442 14.5 Eastern Cape DC15: O.R.Tambo EC154: Port St Johns 27 286 26 081 95.6 1 205 4.4 29 318 24 144 82.4 5 174 17.6 Eastern Cape DC15: O.R.Tambo EC155: Nyandeni 50 742 48 378 95.3 2 364 4.7 56 492 38 013 67.3 18 479 32.7 Eastern Cape DC15: O.R.Tambo EC156: Mhlontlo 39 076 36 274 92.8 2 802 7.2 42 910 29 843 69.5 13 067 30.5 Eastern Cape DC15: O.R.Tambo EC157: King Sabata Dalindyebo 80 611 63 430 78.7 17 181 21.3 90 247 52 291 57.9 37 956 42.1 Eastern Cape DC44: Alfred Nzo EC05b1: Umzimkhulu 31 517 30 023 95.3 1 494 4.7 36 642 25 149 68.6 11 493 31.4 Eastern Cape DC44: Alfred Nzo EC05b2: Umzimvubu 82 084 77 198 94.0 4 886 6.0 87 762 69 883 79.6 17 879 20.4 Northern Cape DC6: Namakwa NC061: Richtersveld 3 038 1 066 35.1 1 972 64.9 2 872 193 6.7 2 679 93.3 Northern Cape DC6: Namakwa NC062: Nama Khoi 9 688 2 754 28.4 6 934 71.6 12 063 1 694 14.0 10 369 86.0 Northern Cape DC6: Namakwa NC064: Kamiesberg 2 597 1 317 50.7 1 280 49.3 3 229 1 386 42.9 1 843 57.1 Northern Cape DC6: Namakwa NC065: Hantam 5 078 1 435 28.3 3 643 71.7 5 491 1 130 20.6 4 361 79.4 Northern Cape DC6: Namakwa NC066: Karoo Hoogland 3 276 1 160 35.4 2 116 64.6 3 146 924 29.4 2 222 70.6 Northern Cape DC6: Namakwa NC067: KhGi-Ma 2 223 459 20.6 1 764 79.4 3 345 773 23.1 2 572 76.9 Northern Cape DC7: Karoo NC071: Ubuntu 4 237 1 418 33.5 2 819 66.5 4 245 928 21.9 3 317 78.1 Northern Cape DC7: Karoo NC072: Umsombomvu 5 454 1 344 24.6 4 110 75.4 5 882 1 150 19.6 4 732 80.4 Northern Cape DC7: Karoo NC073: Emthanjeni 8 540 3 128 36.6 5 412 63.4 8 805 1 421 16.1 7 384 83.9 Northern Cape DC7: Karoo NC074: Kareeberg 2 733 911 33.3 1 822 66.7 2 423 462 19.1 1 961 80.9 PART III KEY HOUSEHOLD SERVICES INDICATORS 259 Table 15: (continued) Local municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households Not utilising electricity Number 260 2001 Utilising electricity % Number Total number of households % Not utilising electricity Number Utilising electricity % Number % Northern Cape DC7: Karoo NC075: Renosterberg 2 372 782 33.0 1 590 67.0 2 464 683 27.7 1 781 72.3 Northern Cape DC7: Karoo NC076: Thembelihle 2 836 983 34.7 1 853 65.3 3 478 1 107 31.8 2 371 68.2 Northern Cape DC7: Karoo NC077: Siyathemba 4 546 981 21.6 3 565 78.4 4 165 580 13.9 3 585 86.1 Northern Cape DC7: Karoo NC078: Siyancuma 7 013 3 017 43.0 3 996 57.0 9 217 2 897 31.4 6 320 68.6 Northern Cape DC8: Siyanda NC081: Mier 1 315 1 041 79.2 274 20.8 1 577 684 43.4 893 56.6 Northern Cape DC8: Siyanda NC082: !Kai! Garib 11 087 4 677 42.2 6 410 57.8 18 484 4 160 22.5 14 324 77.5 Northern Cape DC8: Siyanda NC083: Khara Hais 15 462 4 042 26.1 11 420 73.9 17 185 4 232 24.6 12 953 75.4 Northern Cape DC8: Siyanda NC084: !Kheis 2 939 1 151 39.2 1 788 60.8 3 950 1 508 38.2 2 442 61.8 Northern Cape DC8: Siyanda NC085: Tsantsabane 6 544 1 356 20.7 5 188 79.3 7 358 1 163 15.8 6 195 84.2 Northern Cape DC8: Siyanda NC086: Kgatelopele 3 898 1 484 38.1 2 414 61.9 4 105 720 17.5 3 385 82.5 Northern Cape DC9: Frances Baard NC091: Sol Plaatje 45 155 7 935 17.6 37 220 82.4 51 006 8 856 17.4 42 150 82.6 Northern Cape DC9: Frances Baard NC092: Dikgatlong 7 663 2 995 39.1 4 668 60.9 9 723 3 616 37.2 6 107 62.8 Northern Cape DC9: Frances Baard NC093: Magareng 5 252 1 302 24.8 3 950 75.2 5 813 1 150 19.8 4 663 80.2 Northern Cape CBDC1: Kgalagadi NC01B1: Gamagara 4 185 495 11.8 3 690 88.2 5 138 308 6.0 4 830 94.0 Free State DC16: Xhariep FS161: Letsemeng 8 962 2 213 24.7 6 749 75.3 12 083 3 344 27.7 8 739 72.3 Free State DC16: Xhariep FS162: Kopanong 13 132 3 236 24.6 9 896 75.4 17 612 3 164 18.0 14 448 82.0 Free State DC16: Xhariep FS163: Mohokare 8 783 2 864 32.6 5 919 67.4 9 541 2 530 26.5 7 011 73.5 Free State DC17: Motheo FS171: Naledi 6 300 1 653 26.2 4 647 73.8 7 671 1 655 21.6 6 016 78.4 Free State DC17: Motheo FS172: Mangaung 153 408 59 444 38.7 93 964 61.3 188 656 28 107 14.9 160 549 85.1 Free State DC17: Motheo FS173: Mantsopa 11 506 3 625 31.5 7 881 68.5 14 070 3 486 24.8 10 584 75.2 Free State DC18: Lejweleputswa FS181: Masilonyana 15 032 4 100 27.3 10 932 72.7 20 491 4 807 23.5 15 684 76.5 Free State DC18: Lejweleputswa FS182: Tokologo 6 619 3 002 45.4 3 617 54.6 8 963 2 366 26.4 6 597 73.6 Free State DC18: Lejweleputswa FS183: Tswelopele 11 377 4 308 37.9 7 069 62.1 12 533 4 077 32.5 8 456 67.5 Free State DC18: Lejweleputswa FS184: Matjhabeng 110 705 30 305 27.4 80 400 72.6 128 640 38 240 29.7 90 400 70.3 THE DBSA INFRASTRUCTURE BAROMETER Table 15: (continued) Local municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households Not utilising electricity Number 2001 Utilising electricity % Number Total number of households % Not utilising electricity Number Utilising electricity % Number % Free State DC18: Lejweleputswa FS185: Nala 18 476 10 281 55.6 8 195 44.4 25 985 5 289 20.4 20 696 79.6 Free State DC19: Thabo Mofutsanyane FS191: Setsoto 26 299 9 586 36.5 16 713 63.5 33 563 9 323 27.8 24 240 72.2 Free State DC19: Thabo Mofutsanyane FS192: Dihlabeng 25 459 9 150 35.9 16 309 64.1 33 402 10 808 32.4 22 594 67.6 Free State DC19: Thabo Mofutsanyane FS193: Nketoana 14 749 6 668 45.2 8 081 54.8 15 021 3 459 23.0 11 562 77.0 Free State DC19: Thabo Mofutsanyane FS194: Maluti a Phofung 80 792 62 361 77.2 18 431 22.8 92 100 39 141 42.5 52 959 57.5 Free State DC19: Thabo Mofutsanyane FS195: Phumelela 9 475 5 561 58.7 3 914 41.3 12 026 4 189 34.8 7 837 65.2 Free State DC20: Northern Free State FS201: Moqhaka 37 545 15 466 41.2 22 079 58.8 43 835 6 959 15.9 36 876 84.1 Free State DC20: Nortern Free State FS203: Ngwathe 29 613 19 576 66.1 10 037 33.9 32 508 5 126 15.8 27 382 84.2 Free State DC20: Northern Free State FS204: Metsimaholo 25 669 8 389 32.7 17 280 67.3 33 701 7 457 22.1 26 244 77.9 Free State DC20: Northern Free State FS205: Mafube 12 319 6 463 52.5 5 856 47.5 14 783 4 053 27.4 10 730 72.6 Kwazulu-Natal DC21: Ugu KZ211: Vulamehlo 17 023 14 583 85.7 2 440 14.3 16 797 12 759 76.0 4 038 24.0 Kwazulu-Natal DC21: Ugu KZ212: Umdoni 12 659 3 871 30.6 8 788 69.4 16 468 5 559 33.8 10 909 66.2 Kwazulu-Natal DC21: Ugu KZ213: Umzumbe 27 885 23 154 83.0 4 731 17.0 38 871 27 296 70.2 11 575 29.8 Kwazulu-Natal DC21: Ugu KZ214: uMuziwabantu 14 305 12 129 84.8 2 176 15.2 19 501 14 078 72.2 5 423 27.8 Kwazulu-Natal DC21: Ugu KZ215: Ezingoleni 8 058 5 773 71.6 2 285 28.4 11 430 6 949 60.8 4 481 39.2 Kwazulu-Natal DC21: Ugu KZ216: Hibiscus Coast 42 458 10 780 25.4 31 678 74.6 55 233 13 756 24.9 41 477 75.1 Kwazulu-Natal DC22: UMgungundlovu KZ221: uMshwathi 25 144 19 201 76.4 5 943 23.6 27 190 12 425 45.7 14 765 54.3 Kwazulu-Natal DC22: UMgungundlovu KZ222: uMngeni 15 771 5 527 35.0 10 244 65.0 22 659 6 051 26.7 16 608 73.3 Kwazulu-Natal DC22: UMgungundlovu KZ223: Mooi Mpofana 4 567 2 350 51.5 2 217 48.5 10 496 4 804 45.8 5 692 54.2 Kwazulu-Natal DC22: UMgungundlovu KZ224: Impendle 6 040 4 722 78.2 1 318 21.8 7 456 2 908 39.0 4 548 61.0 Kwazulu-Natal DC22: UMgungundlovu KZ225: Msunduzi 117 519 31 821 27.1 85 698 72.9 135 181 19 083 14.1 116 098 85.9 Kwazulu-Natal DC22: UMgungundlovu KZ226: Mkhambathini 8 949 6 298 70.4 2 651 29.6 15 414 8 700 56.4 6 714 43.6 Kwazulu-Natal DC22: UMgungundlovu KZ227: Richmond 12 266 6 132 50.0 6 134 50.0 16 001 7 061 44.1 8 940 55.9 Kwazulu-Natal DC23: Uthukela KZ232: Ladysmith 33 900 13 185 38.9 20 715 61.1 51 877 16 621 32.0 35 256 68.0 PART III KEY HOUSEHOLD SERVICES INDICATORS 261 Table 15: (continued) Local municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households Not utilising electricity Number 262 Kwazulu-Natal DC23: Uthukela KZ233: Indaka Kwazulu-Natal DC23: Uthukela KZ234: Umtshezi Kwazulu-Natal DC23: Uthukela Kwazulu-Natal 2001 Utilising electricity % Number Total number of households % Not utilising electricity Number Utilising electricity % Number % 15 043 10 927 72.6 4 116 27.4 21 472 11 405 53.1 10 067 46.9 9 038 4 483 49.6 4 555 50.4 13 953 5 019 36.0 8 934 64.0 KZ235: Okhahlamba 19 441 14 544 74.8 4 897 25.2 27 925 16 738 59.9 11 187 40.1 DC23: Uthukela KZ236: Imbabazane 17 569 10 505 59.8 7 064 40.2 23 271 8 374 36.0 14 897 64.0 Kwazulu-Natal DC24: Umzinyathi KZ241: Endumeni 9 279 3 123 33.7 6 156 66.3 13 107 4 248 32.4 8 859 67.6 Kwazulu-Natal DC24: Umzinyathi KZ242: Nqutu 19 873 18 830 94.8 1 043 5.2 25 964 21 377 82.3 4 587 17.7 Kwazulu-Natal DC24: Umzinyathi KZ244: Msinga 27 564 27 037 98.1 527 1.9 32 881 29 856 90.8 3 025 9.2 Kwazulu-Natal DC24: Umzinyathi KZ245: Umvoti 18 660 12 901 69.1 5 759 30.9 22 947 14 490 63.1 8 457 36.9 Kwazulu-Natal DC25: Amajuba KZ252: Newcastle 55 291 7 175 13.0 48 116 87.0 71 923 11 398 15.8 60 525 84.2 Kwazulu-Natal DC25: Amajuba KZ253: Utrecht 3 496 2 369 67.8 1 127 32.2 6 660 4 625 69.4 2 035 30.6 Kwazulu-Natal DC25: Amajuba KZ254: Dannhauser 15 575 10 985 70.5 4 590 29.5 19 471 11 024 56.6 8 447 43.4 Kwazulu-Natal DC26: Zululand KZ261: eDumbe 10 199 7 056 69.2 3 143 30.8 15 812 10 651 67.4 5 161 32.6 Kwazulu-Natal DC26: Zululand KZ262: uPhongolo 15 988 9 374 58.6 6 614 41.4 26 938 12 657 47.0 14 281 53.0 Kwazulu-Natal DC26: Zululand KZ263: Abaqulusi 27 362 17 433 63.7 9 929 36.3 37 017 20 779 56.1 16 238 43.9 Kwazulu-Natal DC26: Zululand KZ265: Nongoma 26 170 22 732 86.9 3 438 13.1 32 436 24 030 74.1 8 406 25.9 Kwazulu-Natal DC26: Zululand KZ266: Ulundi 27 862 22 124 79.4 5 738 20.6 38 648 23 622 61.1 15 026 38.9 Kwazulu-Natal DC27: Umkhanyakude KZ271: Umhlabuyalingana 18 770 18 348 97.8 422 2.2 26 660 24 515 92.0 2 145 8.0 Kwazulu-Natal DC27: Umkhanyakude KZ272: Jozini 22 126 21 271 96.1 855 3.9 34 739 30 317 87.3 4 422 12.7 Kwazulu-Natal DC27: Umkhanyakude KZ273: The Big 5 False Bay 3 739 3 306 88.4 433 11.6 7 070 5 554 78.6 1 516 21.4 Kwazulu-Natal DC27: Umkhanyakude KZ274: Hlabisa 21 855 17 798 81.4 4 057 18.6 27 266 19 281 70.7 7 985 29.3 Kwazulu-Natal DC27: Umkhanyakude KZ275: Mtubatuba 5 106 2 180 42.7 2 926 57.3 8 637 2 064 23.9 6 573 76.1 Kwazulu-Natal DC28: Uthungulu KZ281: Mbonambi 14 080 9 480 67.3 4 600 32.7 20 435 9 692 47.4 10 743 52.6 Kwazulu-Natal DC28: Uthungulu KZ282: uMhlathuze 38 375 8 839 23.0 29 536 77.0 73 234 9 648 13.2 63 586 86.8 Kwazulu-Natal DC28: Uthungulu KZ283: Ntambanana 10 270 8 049 78.4 2 221 21.6 13 829 9 436 68.2 4 393 31.8 THE DBSA INFRASTRUCTURE BAROMETER Table 15: (continued) Local municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households Not utilising electricity Number Kwazulu-Natal DC28: Uthungulu KZ284: uMlalazi Kwazulu-Natal DC28: Uthungulu KZ285: Mthonjaneni Kwazulu-Natal DC28: Uthungulu Kwazulu-Natal 2001 Utilising electricity % Number Total number of households % Not utilising electricity Number Utilising electricity % Number % 35 421 24 725 69.8 10 696 30.2 44 598 24 671 55.3 19 927 44.7 5 301 4 306 81.2 995 18.8 12 646 7 918 62.6 4 728 37.4 KZ286: Nkandla 19 509 19 260 98.7 249 1.3 24 868 23 130 93.0 1 738 7.0 DC29: iLembe KZ291: eNdondakusuka 24 479 13 430 54.9 11 049 45.1 31 001 11 221 36.2 19 780 63.8 Kwazulu-Natal DC29: iLembe KZ292: KwaDukuza 36 841 12 259 33.3 24 582 66.7 45 898 11 473 25.0 34 425 75.0 Kwazulu-Natal DC29: iLembe KZ293: Ndwedwe 25 452 20 535 80.7 4 917 19.3 30 630 22 341 72.9 8 289 27.1 Kwazulu-Natal DC29: iLembe KZ294: Maphumulo 21 402 18 722 87.5 2 680 12.5 22 391 18 380 82.1 4 011 17.9 Kwazulu-Natal DC43: Sisonke KZ5a1: Ingwe 17 445 14 924 85.5 2 521 14.5 21 927 15 838 72.2 6 089 27.8 Kwazulu-Natal DC43: Sisonke KZ5a2: Kwa Sani 3 632 2 374 65.4 1 258 34.6 4 656 2 959 63.6 1 697 36.4 Kwazulu-Natal DC43: Sisonke KZ5a3: Matatiele 2 497 1 135 45.5 1 362 54.5 5 703 2 522 44.2 3 181 55.8 Kwazulu-Natal DC43: Sisonke KZ5a4: Greater Kokstad 8 729 5 775 66.2 2 954 33.8 20 535 10 349 50.4 10 186 49.6 Kwazulu-Natal DC43: Sisonke KZ5a5: Ubuhlebezwe 15 188 13 200 86.9 1 988 13.1 23 088 16 426 71.1 6 662 28.9 North West DC37: Bojanala NW371: Moretele 32 669 16 991 52.0 15 678 48.0 43 167 12 407 28.7 30 760 71.3 North West DC37: Bojanala NW372: Madibeng 76 065 52 262 68.7 23 803 31.3 97 228 27 610 28.4 69 618 71.6 North West DC37: Bojanala NW373: Rustenburg 75 722 37 471 49.5 38 251 50.5 119 581 35 766 29.9 83 815 70.1 North West DC37: Bojanala NW374: Kgetlengrivier 7 718 3 389 43.9 4 329 56.1 10 484 3 884 37.0 6 600 63.0 North West DC37: Bojanala NW375: Moses Kotane 49 137 35 753 72.8 13 384 27.2 62 712 5 488 8.8 57 224 91.2 North West DC38: Central NW381: Setla-Kgobi 17 642 17 052 96.7 590 3.3 22 714 5 351 23.6 17 363 76.4 North West DC38: Central NW382: Tswaing 17 687 11 349 64.2 6 338 35.8 25 624 7 914 30.9 17 710 69.1 North West DC38: Central NW383: Mafikeng 51 658 30 602 59.2 21 056 40.8 67 505 18 890 28.0 48 615 72.0 North West DC38: Central NW384: Ditsobotla 26 611 11 987 45.0 14 624 55.0 36 387 11 946 32.8 24 441 67.2 North West DC38: Central NW385: Zeerust 24 292 16 379 67.4 7 913 32.6 32 363 9 705 30.0 22 658 70.0 North West DC39: Bophirima NW391: Kagisano 18 871 16 072 85.2 2 799 14.8 23 391 7 612 32.5 15 779 67.5 North West DC39: Bophirima NW392: Naledi 12 414 4 763 38.4 7 651 61.6 15 223 5 258 34.5 9 965 65.5 PART III KEY HOUSEHOLD SERVICES INDICATORS 263 Table 15: (continued) Local municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households Not utilising electricity Number 264 North West DC39: Bophirima NW393: Mamusa North West DC39: Bophirima NW394: Greater Taung North West DC39: Bophirima North West 2001 Utilising electricity % Number Total number of households % Not utilising electricity Number Utilising electricity % Number % 9 142 3 696 40.4 5 446 59.6 10 748 3 100 28.8 7 648 71.2 35 663 31 913 89.5 3 750 10.5 41 994 21 305 50.7 20 689 49.3 NW395: Molopo 3 584 2 206 61.6 1 378 38.4 3 791 1 976 52.1 1 815 47.9 DC39: Bophirima NW396: Lekwa-Teemane 7 776 2 205 28.4 5 571 71.6 11 570 3 346 28.9 8 224 71.1 North West DC40: Southern NW401: Ventersdorp 6 860 4 799 70.0 2 061 30.0 11 428 4 383 38.4 7 045 61.6 North West DC40: Southern NW402: Potchefstroom 29 089 12 652 43.5 16 437 56.5 33 962 7 217 21.3 26 745 78.7 North West DC40: Southern NW403: Klerksdorp 77 825 25 161 32.3 52 664 67.7 112 022 17 878 16.0 94 144 84.0 North West DC40: Southern NW404: Maquassi Hills 12 815 4 910 38.3 7 905 61.7 17 291 6 290 36.4 11 001 63.6 North West CBDC1: Kgalagadi NW1a1: Moshaweng 16 176 14 769 91.3 1 407 8.7 18 369 12 683 69.0 5 686 31.0 Gauteng CBDC2: Metsweding GT02b1: Nokeng tsa Taemane 11 149 5 268 47.3 5 881 52.7 16 404 5 476 33.4 10 928 66.6 Gauteng CBDC8: West Rand GT411: Mogale City 61 551 10 630 17.3 50 921 82.7 89 496 18 261 20.4 71 235 79.6 Gauteng CBDC8: West Rand GT412: Randfontein 27 504 6 828 24.8 20 676 75.2 40 471 9 958 24.6 30 513 75.4 Gauteng CBDC8: West Rand GT414: Westonaria 23 219 14 135 60.9 9 084 39.1 51 488 17 284 33.6 34 204 66.4 Gauteng DC42: Sedibeng GT421: Emfuleni 148 889 26 975 18.1 121 914 81.9 190 156 19 331 10.2 170 825 89.8 Gauteng DC42: Sedibeng GT422: Midvaal 17 726 4 576 25.8 13 150 74.2 20 831 7 789 37.4 13 042 62.6 Gauteng DC42: Sedibeng GT423: Lesedi 15 501 7 477 48.2 8 024 51.8 19 002 4 972 26.2 14 030 73.8 Mpumalanga DC30: Gert Sibande MP301: Albert Luthuli 35 486 26 618 75.0 8 868 25.0 41 193 20 162 48.9 21 031 51.1 Mpumalanga DC30: Gert Sibande MP302: Msukaligwa 25 029 14 382 57.5 10 647 42.5 30 263 14 155 46.8 16 108 53.2 Mpumalanga DC30: Gert Sibande MP303: Mkhondo 18 816 11 929 63.4 6 887 36.6 28 899 18 711 64.7 10 188 35.3 Mpumalanga DC30: Gert Sibande MP304: Seme 14 560 5 240 36.0 9 320 64.0 18 392 5 981 32.5 12 411 67.5 Mpumalanga DC30: Gert Sibande MP305: Lekwa 20 479 11 163 54.5 9 316 45.5 26 171 10 276 39.3 15 895 60.7 Mpumalanga DC30: Gert Sibande MP306: Dipaleseng 9 454 3 422 36.2 6 032 63.8 9 572 3 072 32.1 6 500 67.9 Mpumalanga DC30: Gert Sibande MP307: Govan Mbeki 49 675 23 986 48.3 25 689 51.7 67 581 19 333 28.6 48 248 71.4 Mpumalanga DC31: Nkangala MP311: Delmas 12 355 4 648 37.6 7 707 62.4 13 952 4 856 34.8 9 096 65.2 THE DBSA INFRASTRUCTURE BAROMETER Table 15: (continued) Local municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households Not utilising electricity Number 2001 Utilising electricity % Number Total number of households % Not utilising electricity Number Utilising electricity % Number % Mpumalanga DC31: Nkangala MP312: Emalahleni 56 469 16 846 29.8 39 623 70.2 82 241 24 332 29.6 57 909 70.4 Mpumalanga DC31: Nkangala MP313: Middelburg 33 644 9 904 29.4 23 740 70.6 37 040 9 232 24.9 27 808 75.1 Mpumalanga DC31: Nkangala MP314: Highlands 9 302 4 239 45.6 5 063 54.4 10 899 3 212 29.5 7 687 70.5 Mpumalanga DC31: Nkangala MP315: Thembisile 48 099 8 233 17.1 39 866 82.9 58 803 6 850 11.6 51 953 88.4 Mpumalanga DC31: Nkangala MP316: Dr JS Moroka 48 347 12 733 26.3 35 614 73.7 54 328 4 474 8.2 49 854 91.8 Mpumalanga DC32: Ehlanzeni MP321: Thaba Chweu 20 128 6 473 32.2 13 655 67.8 26 559 6 371 24.0 20 188 76.0 Mpumalanga DC32: Ehlanzeni MP322: Mbombela 91 615 46 675 50.9 44 940 49.1 121 951 34 782 28.5 87 169 71.5 Mpumalanga DC32: Ehlanzeni MP323: Umjindi 11 681 5 988 51.3 5 693 48.7 15 855 6 717 42.4 9 138 57.6 Mpumalanga DC32: Ehlanzeni MP324: Nkomazi 53 105 39 622 74.6 13 483 25.4 75 554 39 402 52.2 36 152 47.8 Limpopo DC33: Mopani NP331: Greater Giyani 42 183 23 048 54.6 19 135 45.4 52 861 17 220 32.6 35 641 67.4 Limpopo DC33: Mopani NP332: Greater Letaba 41 465 21 042 50.7 20 423 49.3 53 735 18 273 34.0 35 462 66.0 Limpopo DC33: Mopani NP333: Greater Tzaneen 73 898 33 702 45.6 40 196 54.4 97 376 29 922 30.7 67 454 69.3 Limpopo DC33: Mopani NP334: Ba-Phalaborwa 25 577 9 563 37.4 16 014 62.6 33 532 7 785 23.2 25 747 76.8 Limpopo DC34: Vhembe NP341: Musina 8 401 3 588 42.7 4 813 57.3 13 955 5 653 40.5 8 302 59.5 Limpopo DC34: Vhembe NP342: Mutale 13 113 12 182 92.9 931 7.1 17 645 10 365 58.7 7 280 41.3 Limpopo DC34: Vhembe NP343: Thulamela 101 760 67 894 66.7 33 866 33.3 129 155 51 388 39.8 77 767 60.2 Limpopo DC34: Vhembe NP344: Makhado 88 977 63 750 71.6 25 227 28.4 113 524 37 611 33.1 75 913 66.9 Limpopo DC35: Capricorn NP351: Blouberg 28 016 23 191 82.8 4 825 17.2 35 166 20 823 59.2 14 343 40.8 Limpopo DC35: Capricorn NP352: Aganang 27 584 23 549 85.4 4 035 14.6 32 522 19 275 59.3 13 247 40.7 Limpopo DC35: Capricorn NP353: Molemole 22 668 13 861 61.1 8 807 38.9 28 927 7 235 25.0 21 692 75.0 Limpopo DC35: Capricorn NP354: Polokwane 85 611 49 001 57.2 36 610 42.8 135 434 47 448 35.0 87 986 65.0 Limpopo DC35: Capricorn NP355: Lepele-Nkumpi 44 373 29 331 66.1 15 042 33.9 52 904 20 421 38.6 32 483 61.4 Limpopo DC36: Waterberg NP361: Thabazimbi 14 466 6 728 46.5 7 738 53.5 25 023 10 470 41.8 14 553 58.2 Limpopo DC36: Waterberg NP362: Lephalale 21 218 7 632 36.0 13 586 64.0 28 335 9 765 34.5 18 570 65.5 PART III KEY HOUSEHOLD SERVICES INDICATORS 265 Table 15: (continued) Local municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households Number 266 Limpopo DC36: Waterberg NP364: Mookgopong Limpopo DC36: Waterberg Limpopo 2001 Not utilising electricity Utilising electricity % Number Total number of households % Not utilising electricity Number Utilising electricity % Number % 5 019 2 059 41.0 2 960 59.0 9 563 3 979 41.6 5 584 58.4 NP365: Modimolle 12 031 5 947 49.4 6 084 50.6 20 934 9 453 45.2 11 481 54.8 DC36: Waterberg NP366: Bela-Bela 11 165 4 319 38.7 6 846 61.3 14 159 3 911 27.6 10 248 72.4 Limpopo DC36: Waterberg NP367: Mogalakwena 53 716 37 351 69.5 16 365 30.5 70 082 20 698 29.5 49 384 70.5 Limpopo CBDC3: Sekhukhune NP03A2 Makhuduthama 49 943 37 481 75.0 12 462 25.0 54 204 20 253 37.4 33 951 62.6 Limpopo CBDC3: Sekhukhune NP03A3: Fetakgomo 17 360 14 736 84.9 2 624 15.1 19 000 11 394 60.0 7 606 40.0 Limpopo CBDC4: Bohlabela NP04A1: Maruleng 18 364 12 996 70.8 5 368 29.2 23 032 9 428 40.9 13 604 59.1 Northern Cape/ North West CBDC1: Kgalagadi CBLC1: Ga-Segonyana 13 174 6 664 50.6 6 510 49.4 17 762 4 432 25.0 13 330 75.0 Gauteng/ Mpumalanga CBDC2: Metsweding CBLC2: Kungwini 18 244 6 177 33.9 12 067 66.1 33 560 9 292 27.7 24 268 72.3 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBLC3: Greater Marble Hall 19 388 8 701 44.9 10 687 55.1 26 539 5 299 20.0 21 240 80.0 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBLC4: Greate Groblersdal 42 245 12 941 30.6 29 304 69.4 48 747 7 933 16.3 40 814 83.7 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBLC5: Greater Tubatse 42 526 33 786 79.4 8 740 20.6 56 216 29 498 52.5 26 718 47.5 Limpopo/ Mpumalanga CBDC4: Bohlabela CBLC6: Bushbuckridge 112 986 74 816 66.2 38 170 33.8 109 666 23 040 21.0 86 626 79.0 Northern Cape/ North West DC9: Frances Baard CBLC7: Phokwane 13 406 4 122 30.7 9 284 69.3 17 078 4 340 25.4 12 738 74.6 North West/ Gauteng CBDC8: West Rand CBLC8: Merafong City 39 801 16 741 42.1 23 060 57.9 99 651 19 840 19.9 79 811 80.1 Western Cape DC1: West Coast WCDMA01: West Coast 1 097 471 42.9 626 57.1 1 178 584 49.6 594 50.4 Western Cape DC2: Boland WCDMA02: Breede River 1 594 798 50.1 796 49.9 1 931 568 29.4 1 363 70.6 Western Cape DC3: Overberg WCDMA03: Overberg 12 0 0.0 12 100.0 80 6 7.5 74 92.5 Western Cape DC4: Eden WCDMA04: South Cape 2 875 1 035 36.0 1 840 64.0 3 551 530 14.9 3 021 85.1 Western Cape DC5: Central Karoo WCDMA05: Central Karoo 1 558 359 23.0 1 199 77.0 1 567 213 13.6 1 354 86.4 Eastern Cape DC10: Cacadu ECDMA10: Aberdeen Plain 1 942 1 049 54.0 893 46.0 2 015 1 073 53.3 942 46.7 Eastern Cape DC13: Chris Hani ECDMA13: Mountain Zebra National Park 22 7 31.8 15 68.2 18 0 0.0 18 100.0 Eastern Cape DC14: Ukhahlamba ECDMA14: Oviston Nature Reserve 0 0 0.0 0 0.0 3 3 100.0 0 0.0 Eastern Cape DC44: Alfred Nzo ECDMA44: O’Conners Camp 0 0 0.0 0 0.0 0 0 0.0 0 0.0 THE DBSA INFRASTRUCTURE BAROMETER Table 15: (continued) Local municipalities: Households not utilising electricity as an energy source, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households Number Northern Cape DC6: Namakwa NCDMA06: Namaqualand Northern Cape DC7: Karoo Northern Cape 2001 Not utilising electricity Utilising electricity % Number Total number of households % Not utilising electricity Number Utilising electricity % Number % 564 396 70.2 168 29.8 342 190 55.6 152 44.4 NCDMA07: Bo Karoo 1 290 702 54.4 588 45.6 1 098 476 43.4 622 56.6 DC8: Siyanda NCDMA08: Benede Oranje 2 540 1 649 64.9 891 35.1 3 241 1 592 49.1 1 649 50.9 Northern Cape DC9: Frances Baard NCDMA09: Diamondfields 1 076 677 62.9 399 37.1 1 613 671 41.6 942 58.4 Northern Cape CBDC1: Kgalagadi NCDMACB1: Kalahari 1 882 787 41.8 1 095 58.2 2 488 516 20.7 1 972 79.3 Free State DC19:Thabo Mofutsanyane FSDMA19: Golden Gate Highlands National Park 119 41 34.5 78 65.5 59 0 0.0 59 100.0 DC22: UMgungundlovu KZDMA22: Highmoor/ Kamberg Park 152 88 57.9 64 42.1 12 3 25.0 9 75.0 Kwazulu-Natal DC23: Uthukela KZDMA23: Gaints Castle Game Reserve 75 1 1.3 74 98.7 217 44 20.3 173 79.7 Kwazulu-Natal DC27: Umkhanyakude KZDMA27: St Lucia Park 1 612 1 509 93.6 103 6.4 1 285 606 47.2 679 52.8 Kwazulu-Natal DC43: Sisonke KZDMA43: Mkhomazi Wilderness Area 311 86 27.7 225 72.3 330 111 33.6 219 66.4 North West DC37: Bojanala NWDMA37: Pilansberg National Park 96 12 12.5 84 87.5 121 0 0.0 121 100.0 Gauteng CBDC8: West Rand GTDMA41: West Rand 971 359 37.0 612 63.0 2 010 598 29.8 1 412 70.2 Mpumalanga DC31: Nkangala MPDMA31: Mdala Nature Reserve 5 5 100.0 0 0.0 0 0 0.0 0 0.0 Mpumalanga DC32: Ehlanzeni MPDMA32: Lowveld 0 0 0.0 0 0.0 263 174 66.2 89 33.8 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBDMA3: Schuinsdraai Nature Reserve 9 3 33.3 6 66.7 0 0 0.0 0 0.0 Limpopo/ Mpumalanga CBDC4: Bohlabela CBDMA4: Kruger Park 538 118 21.9 420 78.1 2 294 251 10.9 2 043 89.1 5 841 979 3 178 493 54.4 2 663 486 45.6 7 479 952 2 701 104 36.1 4 778 848 63.9 Kwazulu-Natal Total Note: 0 (zero) households: information is not available PART III KEY HOUSEHOLD SERVICES INDICATORS 267 Table 16: Local municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province 268 District Municipality Local Municipality 1996 Total number of households 2001 No access/ no nearby access With access/ nearby access Number Number % Total number of households % No access/ no nearby access With access/ nearby access Number Number % % Western Cape DC1: West Coast WC011: Matzikama 9 956 888 8.9 9 068 91.1 14 464 1 468 10.1 12 996 89.9 Western Cape DC1: West Coast WC012: Cederberg 7 803 599 7.7 7 204 92.3 11 180 987 8.8 10 193 91.2 Western Cape DC1: West Coast WC013: Bergrivier 8 886 406 4.6 8 480 95.4 13 295 727 5.5 12 568 94.5 Western Cape DC1: West Coast WC014: Saldanha Bay 12 791 513 4.0 12 278 96.0 18 887 246 1.3 18 641 98.7 Western Cape DC1: West Coast WC015: Swartland 15 889 1 054 6.6 14 835 93.4 18 668 1 283 6.9 17 385 93.1 Western Cape DC2: Boland WC022: Witzenberg 16 124 1 990 12.3 14 134 87.7 20 384 1 270 6.2 19 114 93.8 Western Cape DC2: Boland WC023: Drakenstein 42 245 3 399 8.0 38 846 92.0 46 216 1 387 3.0 44 829 97.0 Western Cape DC2: Boland WC024: Stellenbosch 26 186 1 514 5.8 24 672 94.2 34 772 383 1.1 34 389 98.9 Western Cape DC2: Boland WC025: Breede Valley 29 190 2 680 9.2 26 510 90.8 35 004 1 485 4.2 33 519 95.8 Western Cape DC2: Boland WC026: Breede River/Winelands 16 122 1 529 9.5 14 593 90.5 21 155 1 268 6.0 19 887 94.0 Western Cape DC3: Overberg WC031: Theewaterskloof 18 057 1 173 6.5 16 884 93.5 24 302 766 3.2 23 536 96.8 Western Cape DC3: Overberg WC032: Overstrand 11 412 456 4.0 10 956 96.0 19 056 197 1.0 18 859 99.0 Western Cape DC3: Overberg WC033: Cape Agulhas 5 595 305 5.5 5 290 94.5 7 544 154 2.0 7 390 98.0 Western Cape DC3: Overberg WC034: Swellendam 6 098 628 10.3 5 470 89.7 7 597 573 7.5 7 024 92.5 Western Cape DC4: Eden WC041: Kannaland 4 855 814 16.8 4 041 83.2 6 137 587 9.6 5 550 90.4 Western Cape DC4: Eden WC042: Langeberg 9 743 634 6.5 9 109 93.5 12 624 597 4.7 12 027 95.3 Western Cape DC4: Eden WC043: Mossel Bay 15 420 933 6.1 14 487 93.9 20 195 437 2.2 19 758 97.8 Western Cape DC4: Eden WC044: George 25 700 796 3.1 24 904 96.9 36 114 1 390 3.8 34 724 96.2 Western Cape DC4: Eden WC045: Oudtshoorn 15 734 939 6.0 14 795 94.0 18 311 625 3.4 17 686 96.6 Western Cape DC4: Eden WC047: Plettenberg Bay 5 075 312 6.1 4 763 93.9 8 921 442 5.0 8 479 95.0 Western Cape DC4: Eden WC048: Knysna 11 498 683 5.9 10 815 94.1 14 900 217 1.5 14 683 98.5 Western Cape DC5: Central Karoo WC051: Laingsburg 1 461 235 16.1 1 226 83.9 1 943 66 3.4 1 877 96.6 Western Cape DC5: Central Karoo WC052: Prince Albert 2 132 594 27.9 1 538 72.1 2 604 210 8.1 2 394 91.9 Western Cape DC5: Central Karoo WC053: Beaufort West 7 309 565 7.7 6 744 92.3 9 063 586 6.5 8 477 93.5 THE DBSA INFRASTRUCTURE BAROMETER Table 16: (continued) Local municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households 2001 No access/ no nearby access With access/ nearby access Number Number % Total number of households % No access/ no nearby access With access/ nearby access Number Number % % Eastern Cape DC10: Cacadu EC101: Camdeboo 9 388 571 6.1 8 817 93.9 10 466 628 6.0 9 838 94.0 Eastern Cape DC10: Cacadu EC102: Blue Crane Route 8 001 484 6.0 7 517 94.0 9 538 1 111 11.6 8 427 88.4 Eastern Cape DC10: Cacadu EC103: Ikwezi 2 329 350 15.0 1 979 85.0 2 748 140 5.1 2 608 94.9 Eastern Cape DC10: Cacadu EC104: Makana 16 329 1 537 9.4 14 792 90.6 18 154 925 5.1 17 229 94.9 Eastern Cape DC10: Cacadu EC105: Ndlambe 11 668 1 063 9.1 10 605 90.9 15 916 1 088 6.8 14 828 93.2 Eastern Cape DC10: Cacadu EC106: Sunday’s River Valley 9 411 1 165 12.4 8 246 87.6 10 514 792 7.5 9 722 92.5 Eastern Cape DC10: Cacadu EC107: Baviaans 3 106 208 6.7 2 898 93.3 3 887 215 5.5 3 672 94.5 Eastern Cape DC10: Cacadu EC108: Kouga 14 552 1 170 8.0 13 382 92.0 19 522 1 412 7.2 18 110 92.8 Eastern Cape DC10: Cacadu EC109: Kou-Kamma 6 856 493 7.2 6 363 92.8 9 961 562 5.6 9 399 94.4 Eastern Cape DC12: Amatole EC121: Mbhashe 48 880 43 698 89.4 5 182 10.6 53 174 20 531 38.6 32 643 61.4 Eastern Cape DC12: Amatole EC122: Mnquma 60 052 48 959 81.5 11 093 18.5 67 858 19 808 29.2 48 050 70.8 Eastern Cape DC12: Amatole EC123: Great Kei 8 408 2 240 26.6 6 168 73.4 11 507 969 8.4 10 538 91.6 Eastern Cape DC12: Amatole EC124: Amahlathi 29 176 18 088 62.0 11 088 38.0 34 876 8 298 23.8 26 578 76.2 Eastern Cape DC12: Amatole EC125: Buffalo City 160 779 27 837 17.3 132 942 82.7 194 063 11 852 6.1 182 211 93.9 Eastern Cape DC12: Amatole EC126: Ngqushwa 20 620 13 240 64.2 7 380 35.8 21 892 3 246 14.8 18 646 85.2 Eastern Cape DC12: Amatole EC127: Nkonkobe 28 637 14 091 49.2 14 546 50.8 34 361 3 588 10.4 30 773 89.6 Eastern Cape DC12: Amatole EC128: Nxuba 5 434 713 13.1 4 721 86.9 6 634 914 13.8 5 720 86.2 Eastern Cape DC13: Chris Hani EC131: Inxuba Yethemba 13 064 1 127 8.6 11 937 91.4 16 048 951 5.9 15 097 94.1 Eastern Cape DC13: Chris Hani EC132: Tsolwana 7 754 3 664 47.3 4 090 52.7 7 934 661 8.3 7 273 91.7 Eastern Cape DC13: Chris Hani EC133: Inkwanca 4 270 587 13.7 3 683 86.3 5 478 669 12.2 4 809 87.8 Eastern Cape DC13: Chris Hani EC134: Lukanji 37 447 12 561 33.5 24 886 66.5 44 910 4 077 9.1 40 833 90.9 Eastern Cape DC13: Chris Hani EC135: Intsika Yethu 44 194 38 926 88.1 5 268 11.9 45 171 13 125 29.1 32 046 70.9 Eastern Cape DC13: Chris Hani EC136: Emalahleni 25 512 20 494 80.3 5 018 19.7 26 067 4 821 18.5 21 246 81.5 Eastern Cape DC13: Chris Hani EC137: Engcobo 28 423 22 914 80.6 5 509 19.4 31 425 10 952 34.9 20 473 65.1 PART III KEY HOUSEHOLD SERVICES INDICATORS 269 Table 16: (continued) Local municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province 270 District Municipality Local Municipality 1996 Total number of households 2001 No access/ no nearby access With access/ nearby access Number Number % Total number of households % No access/ no nearby access With access/ nearby access Number Number % % Eastern Cape DC13: Chris Hani EC138: Sakhisizwe 10 016 5 752 57.4 4 264 42.6 12 721 2 911 22.9 9 810 77.1 Eastern Cape DC14: Ukhahlamba EC141: Elundini 29 585 23 860 80.6 5 725 19.4 33 786 18 257 54.0 15 529 46.0 Eastern Cape DC14: Ukhahlamba EC142: Senqu 27 923 18 263 65.4 9 660 34.6 34 053 8 028 23.6 26 025 76.4 Eastern Cape DC14: Ukhahlamba EC143: Maletswai 7 007 1 145 16.3 5 862 83.7 9 790 1 526 15.6 8 264 84.4 Eastern Cape DC14: Ukhahlamba EC144: Gariep 6 589 693 10.5 5 896 89.5 8 265 916 11.1 7 349 88.9 Eastern Cape DC15: O.R.Tambo EC151: Mbizana 41 891 38 432 91.7 3 459 8.3 46 340 17 953 38.7 28 387 61.3 Eastern Cape DC15: O.R.Tambo EC152: Ntabankulu 22 984 21 538 93.7 1 446 6.3 27 170 11 409 42.0 15 761 58.0 Eastern Cape DC15: O.R.Tambo EC153: Qaukeni 44 358 38 069 85.8 6 289 14.2 51 212 14 306 27.9 36 906 72.1 Eastern Cape DC15: O.R.Tambo EC154: Port St Johns 27 286 23 926 87.7 3 360 12.3 29 316 11 379 38.8 17 937 61.2 Eastern Cape DC15: O.R.Tambo EC155: Nyandeni 50 742 43 654 86.0 7 088 14.0 56 491 15 093 26.7 41 398 73.3 Eastern Cape DC15: O.R.Tambo EC156: Mhlontlo 39 076 33 994 87.0 5 082 13.0 42 908 13 328 31.1 29 580 68.9 Eastern Cape DC15: O.R.Tambo EC157: King Sabata Dalindyebo 80 611 54 778 68.0 25 833 32.0 90 247 18 740 20.8 71 507 79.2 Eastern Cape DC44: Alfred Nzo EC05b1: Umzimkhulu 31 517 26 324 83.5 5 193 16.5 36 642 12 055 32.9 24 587 67.1 Eastern Cape DC44: Alfred Nzo EC05b2: Umzimvubu 82 084 73 348 89.4 8 736 10.6 87 763 43 072 49.1 44 691 50.9 Northern Cape DC6: Namakwa NC061: Richtersveld 3 038 270 8.9 2 768 91.1 2 873 42 1.5 2 831 98.5 Northern Cape DC6: Namakwa NC062: Nama Khoi 9 688 735 7.6 8 953 92.4 12 064 492 4.1 11 572 95.9 Northern Cape DC6: Namakwa NC064: Kamiesberg 2 597 500 19.3 2 097 80.7 3 229 174 5.4 3 055 94.6 Northern Cape DC6: Namakwa NC065: Hantam 5 078 475 9.4 4 603 90.6 5 490 270 4.9 5 220 95.1 Northern Cape DC6: Namakwa NC066: Karoo Hoogland 3 276 444 13.6 2 832 86.4 3 147 264 8.4 2 883 91.6 Northern Cape DC6: Namakwa NC067: KhGi-Ma 2 223 378 17.0 1 845 83.0 3 346 332 9.9 3 014 90.1 Northern Cape DC7: Karoo NC071: Ubuntu 4 237 1 199 28.3 3 038 71.7 4 245 346 8.2 3 899 91.8 Northern Cape DC7: Karoo NC072: Umsombomvu 5 454 662 12.1 4 792 87.9 5 881 473 8.0 5 408 92.0 Northern Cape DC7: Karoo NC073: Emthanjeni 8 540 1 438 16.8 7 102 83.2 8 804 677 7.7 8 127 92.3 Northern Cape DC7: Karoo NC074: Kareeberg 2 733 545 19.9 2 188 80.1 2 424 190 7.8 2 234 92.2 THE DBSA INFRASTRUCTURE BAROMETER Table 16: (continued) Local municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province District Municipality Local Municipality 1996 Total number of households 2001 No access/ no nearby access With access/ nearby access Number Number % Total number of households % No access/ no nearby access With access/ nearby access Number Number % % Northern Cape DC7: Karoo NC075: Renosterberg 2 372 268 11.3 2 104 88.7 2 465 324 13.1 2 141 86.9 Northern Cape DC7: Karoo NC076: Thembelihle 2 836 899 31.7 1 937 68.3 3 477 226 6.5 3 251 93.5 Northern Cape DC7: Karoo NC077: Siyathemba 4 546 728 16.0 3 818 84.0 4 163 280 6.7 3 883 93.3 Northern Cape DC7: Karoo NC078: Siyancuma 7 013 1 765 25.2 5 248 74.8 9 215 859 9.3 8 356 90.7 Northern Cape DC8: Siyanda NC081: Mier 1 315 286 21.7 1 029 78.3 1 577 192 12.2 1 385 87.8 Northern Cape DC8: Siyanda NC082: !Kai! Garib 11 087 1 697 15.3 9 390 84.7 18 484 1 187 6.4 17 297 93.6 Northern Cape DC8: Siyanda NC083: Khara Hais 15 462 1 721 11.1 13 741 88.9 17 186 782 4.6 16 404 95.4 Northern Cape DC8: Siyanda NC084: !Kheis 2 939 355 12.1 2 584 87.9 3 950 673 17.0 3 277 83.0 Northern Cape DC8: Siyanda NC085: Tsantsabane 6 544 1 459 22.3 5 085 77.7 7 358 592 8.0 6 766 92.0 Northern Cape DC8: Siyanda NC086: Kgatelopele 3 898 411 10.5 3 487 89.5 4 106 144 3.5 3 962 96.5 Northern Cape DC9: Frances Baard NC091: Sol Plaatje 45 155 4 619 10.2 40 536 89.8 51 005 2 123 4.2 48 882 95.8 Northern Cape DC9: Frances Baard NC092: Dikgatlong 7 663 2 223 29.0 5 440 71.0 9 723 1 363 14.0 8 360 86.0 Northern Cape DC9: Frances Baard NC093: Magareng 5 252 595 11.3 4 657 88.7 5 812 373 6.4 5 439 93.6 Northern Cape CBDC1: Kgalagadi NC01B1: Gamagara 4 185 288 6.9 3 897 93.1 5 136 222 4.3 4 914 95.7 Free State DC16: Xhariep FS161: Letsemeng 8 962 2 100 23.4 6 862 76.6 12 083 1 501 12.4 10 582 87.6 Free State DC16: Xhariep FS162: Kopanong 13 132 2 358 18.0 10 774 82.0 17 611 2 787 15.8 14 824 84.2 Free State DC16: Xhariep FS163: Mohokare 8 783 2 266 25.8 6 517 74.2 9 540 1 754 18.4 7 786 81.6 Free State DC17: Motheo FS171: Naledi 6 300 2 122 33.7 4 178 66.3 7 673 1 281 16.7 6 392 83.3 Free State DC17: Motheo FS172: Mangaung 153 408 21 940 14.3 131 468 85.7 188 657 9 943 5.3 178 714 94.7 Free State DC17: Motheo FS173: Mantsopa 11 506 2 348 20.4 9 158 79.6 14 070 2 154 15.3 11 916 84.7 Free State DC18: Lejweleputswa FS181: Masilonyana 15 032 2 180 14.5 12 852 85.5 20 492 2 916 14.2 17 576 85.8 Free State DC18: Lejweleputswa FS182: Tokologo 6 619 1 542 23.3 5 077 76.7 8 964 2 109 23.5 6 855 76.5 Free State DC18: Lejweleputswa FS183: Tswelopele 11 377 2 802 24.6 8 575 75.4 12 532 2 553 20.4 9 979 79.6 Free State DC18: Lejweleputswa FS184: Matjhabeng 110 705 14 024 12.7 96 681 87.3 128 640 7 476 5.8 121 164 94.2 PART III KEY HOUSEHOLD SERVICES INDICATORS 271 Table 16: (continued) Local municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province 272 District Municipality Local Municipality 1996 Total number of households 2001 No access/ no nearby access With access/ nearby access Number Number % Total number of households % No access/ no nearby access With access/ nearby access Number Number % % Free State DC18: Lejweleputswa FS185: Nala 18 476 4 086 22.1 14 390 77.9 25 985 5 776 22.2 20 209 77.8 Free State DC19:Thabo Mofutsanyane FS191: Setsoto 26 299 5 726 21.8 20 573 78.2 33 563 6 631 19.8 26 932 80.2 Free State DC19: Thabo Mofutsanyane FS192: Dihlabeng 25 459 3 460 13.6 21 999 86.4 33 402 4 929 14.8 28 473 85.2 Free State DC19: Thabo Mofutsanyane FS193: Nketoana 14 749 3 387 23.0 11 362 77.0 15 023 1 802 12.0 13 221 88.0 Free State DC19: Thabo Mofutsanyane FS194: Maluti a Phofung 80 792 23 733 29.4 57 059 70.6 92 102 9 310 10.1 82 792 89.9 Free State DC19: Thabo Mofutsanyane FS195: Phumelela 9 475 2 852 30.1 6 623 69.9 12 026 2 473 20.6 9 553 79.4 Free State DC20: Northern Free State FS201: Moqhaka 37 545 8 157 21.7 29 388 78.3 43 834 3 968 9.1 39 866 90.9 Free State DC20: Northern Free State FS203: Ngwathe 29 613 6 063 20.5 23 550 79.5 32 510 4 027 12.4 28 483 87.6 Free State DC20: Northern Free State FS204: Metsimaholo 25 669 2 905 11.3 22 764 88.7 33 701 964 2.9 32 737 97.1 Free State DC20: Northern Free State FS205: Mafube 12 319 2 760 22.4 9 559 77.6 14 782 2 345 15.9 12 437 84.1 Kwazulu-Natal DC21: Ugu KZ211: Vulamehlo 17 023 8 051 47.3 8 972 52.7 16 797 4 844 28.8 11 953 71.2 Kwazulu-Natal DC21: Ugu KZ212: Umdoni 12 659 2 495 19.7 10 164 80.3 16 467 1 924 11.7 14 543 88.3 Kwazulu-Natal DC21: Ugu KZ213: Umzumbe 27 885 15 279 54.8 12 606 45.2 38 869 7 937 20.4 30 932 79.6 Kwazulu-Natal DC21: Ugu KZ214: uMuziwabantu 14 305 7 385 51.6 6 920 48.4 19 501 3 065 15.7 16 436 84.3 Kwazulu-Natal DC21: Ugu KZ215: Ezingoleni 8 058 4 452 55.2 3 606 44.8 11 431 1 327 11.6 10 104 88.4 Kwazulu-Natal DC21: Ugu KZ216: Hibiscus Coast 42 458 9 216 21.7 33 242 78.3 55 232 6 414 11.6 48 818 88.4 Kwazulu-Natal DC22: UMgungundlovu KZ221: uMshwathi 25 144 13 468 53.6 11 676 46.4 27 189 5 682 20.9 21 507 79.1 Kwazulu-Natal DC22: UMgungundlovu KZ222: uMngeni 15 771 2 417 15.3 13 354 84.7 22 660 2 952 13.0 19 708 87.0 Kwazulu-Natal DC22: UMgungundlovu KZ223: Mooi Mpofana 4 567 692 15.2 3 875 84.8 10 495 3 246 30.9 7 249 69.1 Kwazulu-Natal DC22: UMgungundlovu KZ224: Impendle 6 040 1 946 32.2 4 094 67.8 7 457 1 142 15.3 6 315 84.7 Kwazulu-Natal DC22: UMgungundlovu KZ225: Msunduzi 117 519 20 707 17.6 96 812 82.4 135 180 8 443 6.2 126 737 93.8 Kwazulu-Natal DC22: UMgungundlovu KZ226: Mkhambathini 8 949 4 231 47.3 4 718 52.7 15 414 4 372 28.4 11 042 71.6 Kwazulu-Natal DC22: UMgungundlovu KZ227: Richmond 12 266 5 248 42.8 7 018 57.2 16 001 4 676 29.2 11 325 70.8 Kwazulu-Natal DC23: Uthukela KZ232: Ladysmith 33 900 10 600 31.3 23 300 68.7 51 879 4 744 9.1 47 135 90.9 THE DBSA INFRASTRUCTURE BAROMETER Table 16: (continued) Local municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province District Municipality Local Municipality Kwazulu-Natal DC23: Uthukela KZ233: Indaka Kwazulu-Natal DC23: Uthukela KZ234: Umtshezi Kwazulu-Natal DC23: Uthukela Kwazulu-Natal 1996 Total number of households 2001 No access/ no nearby access With access/ nearby access Number Number % Total number of households % No access/ no nearby access With access/ nearby access Number Number % % 15 043 6 430 42.7 8 613 57.3 21 472 5 013 23.3 16 459 76.7 9 038 1 664 18.4 7 374 81.6 13 952 2 456 17.6 11 496 82.4 KZ235: Okhahlamba 19 441 6 846 35.2 12 595 64.8 27 924 6 141 22.0 21 783 78.0 DC23: Uthukela KZ236: Imbabazane 17 569 10 787 61.4 6 782 38.6 23 269 2 336 10.0 20 933 90.0 Kwazulu-Natal DC24: Umzinyathi KZ241: Endumeni 9 279 1 428 15.4 7 851 84.6 13 106 845 6.4 12 261 93.6 Kwazulu-Natal DC24: Umzinyathi KZ242: Nqutu 19 873 12 618 63.5 7 255 36.5 25 966 7 538 29.0 18 428 71.0 Kwazulu-Natal DC24: Umzinyathi KZ244: Msinga 27 564 14 795 53.7 12 769 46.3 32 879 14 485 44.1 18 394 55.9 Kwazulu-Natal DC24: Umzinyathi KZ245: Umvoti 18 660 8 863 47.5 9 797 52.5 22 948 5 452 23.8 17 496 76.2 Kwazulu-Natal DC25: Amajuba KZ252: Newcastle 55 291 6 926 12.5 48 365 87.5 71 922 3 505 4.9 68 417 95.1 Kwazulu-Natal DC25: Amajuba KZ253: Utrecht 3 496 1 973 56.4 1 523 43.6 6 660 2 443 36.7 4 217 63.3 Kwazulu-Natal DC25: Amajuba KZ254: Dannhauser 15 575 7 697 49.4 7 878 50.6 19 469 2 736 14.1 16 733 85.9 Kwazulu-Natal DC26: Zululand KZ261: eDumbe 10 199 4 279 42.0 5 920 58.0 15 811 4 178 26.4 11 633 73.6 Kwazulu-Natal DC26: Zululand KZ262: uPhongolo 15 988 8 815 55.1 7 173 44.9 26 939 7 300 27.1 19 639 72.9 Kwazulu-Natal DC26: Zululand KZ263: Abaqulusi 27 362 10 166 37.2 17 196 62.8 37 017 5 692 15.4 31 325 84.6 Kwazulu-Natal DC26: Zululand KZ265: Nongoma 26 170 20 621 78.8 5 549 21.2 32 437 10 104 31.1 22 333 68.9 Kwazulu-Natal DC26: Zululand KZ266: Ulundi 27 862 15 455 55.5 12 407 44.5 38 648 9 697 25.1 28 951 74.9 Kwazulu-Natal DC27: Umkhanyakude KZ271: Umhlabuyalingana 18 770 12 291 65.5 6 479 34.5 26 660 7 427 27.9 19 233 72.1 Kwazulu-Natal DC27: Umkhanyakude KZ272: Jozini 22 126 13 350 60.3 8 776 39.7 34 740 7 805 22.5 26 935 77.5 Kwazulu-Natal DC27: Umkhanyakude KZ273: The Big 5 False Bay 3 739 2 635 70.5 1 104 29.5 7 069 1 030 14.6 6 039 85.4 Kwazulu-Natal DC27: Umkhanyakude KZ274: Hlabisa 21 855 14 063 64.3 7 792 35.7 27 266 6 697 24.6 20 569 75.4 Kwazulu-Natal DC27: Umkhanyakude KZ275: Mtubatuba 5 106 1 230 24.1 3 876 75.9 8 638 803 9.3 7 835 90.7 Kwazulu-Natal DC28: Uthungulu KZ281: Mbonambi 14 080 9 881 70.2 4 199 29.8 20 435 3 033 14.8 17 402 85.2 Kwazulu-Natal DC28: Uthungulu KZ282: uMhlathuze 38 375 7 609 19.8 30 766 80.2 73 233 5 629 7.7 67 604 92.3 Kwazulu-Natal DC28: Uthungulu KZ283: Ntambanana 10 270 8 123 79.1 2 147 20.9 13 830 4 637 33.5 9 193 66.5 PART III KEY HOUSEHOLD SERVICES INDICATORS 273 Table 16: (continued) Local municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province 274 District Municipality Local Municipality Kwazulu-Natal DC28: Uthungulu KZ284: uMlalazi Kwazulu-Natal DC28: Uthungulu KZ285: Mthonjaneni Kwazulu-Natal DC28: Uthungulu Kwazulu-Natal 1996 Total number of households 2001 No access/ no nearby access With access/ nearby access Number Number % Total number of households % No access/ no nearby access With access/ nearby access Number Number % % 35 421 19 817 55.9 15 604 44.1 44 601 13 415 30.1 31 186 69.9 5 301 2 988 56.4 2 313 43.6 12 645 6 301 49.8 6 344 50.2 KZ286: Nkandla 19 509 13 523 69.3 5 986 30.7 24 866 10 024 40.3 14 842 59.7 DC29: iLembe KZ291: eNdondakusuka 24 479 12 519 51.1 11 960 48.9 31 001 4 152 13.4 26 849 86.6 Kwazulu-Natal DC29: iLembe KZ292: KwaDukuza 36 841 7 263 19.7 29 578 80.3 45 897 4 592 10.0 41 305 90.0 Kwazulu-Natal DC29: iLembe KZ293: Ndwedwe 25 452 14 593 57.3 10 859 42.7 30 632 7 744 25.3 22 888 74.7 Kwazulu-Natal DC29: iLembe KZ294: Maphumulo 21 402 13 908 65.0 7 494 35.0 22 391 4 636 20.7 17 755 79.3 Kwazulu-Natal DC43: Sisonke KZ5a1: Ingwe 17 445 9 287 53.2 8 158 46.8 21 925 7 419 33.8 14 506 66.2 Kwazulu-Natal DC43: Sisonke KZ5a2: Kwa Sani 3 632 1 440 39.6 2 192 60.4 4 656 811 17.4 3 845 82.6 Kwazulu-Natal DC43: Sisonke KZ5a3: Matatiele 2 497 702 28.1 1 795 71.9 5 704 760 13.3 4 944 86.7 Kwazulu-Natal DC43: Sisonke KZ5a4: Greater Kokstad 8 729 3 019 34.6 5 710 65.4 20 535 3 567 17.4 16 968 82.6 Kwazulu-Natal DC43: Sisonke KZ5a5: Ubuhlebezwe 15 188 6 033 39.7 9 155 60.3 23 088 4 602 19.9 18 486 80.1 North West DC37: Bojanala NW371: Moretele 32 669 12 905 39.5 19 764 60.5 43 168 3 685 8.5 39 483 91.5 North West DC37: Bojanala NW372: Madibeng 76 065 17 974 23.6 58 091 76.4 97 227 5 975 6.1 91 252 93.9 North West DC37: Bojanala NW373: Rustenburg 75 722 15 702 20.7 60 020 79.3 119 581 4 209 3.5 115 372 96.5 North West DC37: Bojanala NW374: Kgetlengrivier 7 718 1 111 14.4 6 607 85.6 10 483 956 9.1 9 527 90.9 North West DC37: Bojanala NW375: Moses Kotane 49 137 23 462 47.7 25 675 52.3 62 710 8 175 13.0 54 535 87.0 North West DC38: Central NW381: Setla-Kgobi 17 642 13 124 74.4 4 518 25.6 22 714 4 209 18.5 18 505 81.5 North West DC38: Central NW382: Tswaing 17 687 5 760 32.6 11 927 67.4 25 624 5 405 21.1 20 219 78.9 North West DC38: Central NW383: Mafikeng 51 658 17 957 34.8 33 701 65.2 67 505 11 099 16.4 56 406 83.6 North West DC38: Central NW384: Ditsobotla 26 611 6 533 24.5 20 078 75.5 36 388 5 349 14.7 31 039 85.3 North West DC38: Central NW385: Zeerust 24 292 10 637 43.8 13 655 56.2 32 363 4 385 13.5 27 978 86.5 North West DC39: Bophirima NW391: Kagisano 18 871 8 675 46.0 10 196 54.0 23 390 5 650 24.2 17 740 75.8 North West DC39: Bophirima NW392: Naledi 12 414 1 942 15.6 10 472 84.4 15 223 1 210 7.9 14 013 92.1 THE DBSA INFRASTRUCTURE BAROMETER Table 16: (continued) Local municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province District Municipality Local Municipality North West DC39: Bophirima NW393: Mamusa North West DC39: Bophirima NW394: Greater Taung North West DC39: Bophirima North West 1996 Total number of households 2001 No access/ no nearby access With access/ nearby access Number Number % Total number of households % No access/ no nearby access With access/ nearby access Number Number % % 9 142 1 768 19.3 7 374 80.7 10 747 1 363 12.7 9 384 87.3 35 663 18 171 51.0 17 492 49.0 41 996 4 556 10.8 37 440 89.2 NW395: Molopo 3 584 831 23.2 2 753 76.8 3 789 1 131 29.8 2 658 70.2 DC39: Bophirima NW396: Lekwa-Teemane 7 776 706 9.1 7 070 90.9 11 571 1 897 16.4 9 674 83.6 North West DC40: Southern NW401: Ventersdorp 6 860 1 289 18.8 5 571 81.2 11 427 1 785 15.6 9 642 84.4 North West DC40: Southern NW402: Potchefstroom 29 089 4 139 14.2 24 950 85.8 33 963 2 329 6.9 31 634 93.1 North West DC40: Southern NW403: Klerksdorp 77 825 8 150 10.5 69 675 89.5 112 023 5 072 4.5 106 951 95.5 North West DC40: Southern NW404: Maquassi Hills 12 815 2 382 18.6 10 433 81.4 17 292 3 230 18.7 14 062 81.3 North West CBDC1: Kgalagadi NW1a1: Moshaweng 16 176 6 617 40.9 9 559 59.1 18 369 5 677 30.9 12 692 69.1 Gauteng CBDC2: Metsweding GT02b1: Nokeng tsa Taemane 11 149 1 348 12.1 9 801 87.9 16 405 824 5.0 15 581 95.0 Gauteng CBDC8: West Rand GT411: Mogale City 61 551 3 574 5.8 57 977 94.2 89 497 3 419 3.8 86 078 96.2 Gauteng CBDC8: West Rand GT412: Randfontein 27 504 2 246 8.2 25 258 91.8 40 473 1 246 3.1 39 227 96.9 Gauteng CBDC8: West Rand GT414: Westonaria 23 219 1 572 6.8 21 647 93.2 51 486 1 065 2.1 50 421 97.9 Gauteng DC42: Sedibeng GT421: Emfuleni 148 889 7 142 4.8 141 747 95.2 190 157 5 466 2.9 184 691 97.1 Gauteng DC42: Sedibeng GT422: Midvaal 17 726 2 780 15.7 14 946 84.3 20 830 861 4.1 19 969 95.9 Gauteng DC42: Sedibeng GT423: Lesedi 15 501 1 080 7.0 14 421 93.0 19 002 1 143 6.0 17 859 94.0 Mpumalanga DC30: Gert Sibande MP301: Albert Luthuli 35 486 9 965 28.1 25 521 71.9 41 194 4 651 11.3 36 543 88.7 Mpumalanga DC30: Gert Sibande MP302: Msukaligwa 25 029 4 474 17.9 20 555 82.1 30 264 2 955 9.8 27 309 90.2 Mpumalanga DC30: Gert Sibande MP303: Mkhondo 18 816 8 816 46.9 10 000 53.1 28 900 4 786 16.6 24 114 83.4 Mpumalanga DC30: Gert Sibande MP304: Seme 14 560 2 976 20.4 11 584 79.6 18 393 1 989 10.8 16 404 89.2 Mpumalanga DC30: Gert Sibande MP305: Lekwa 20 479 2 781 13.6 17 698 86.4 26 173 1 889 7.2 24 284 92.8 Mpumalanga DC30: Gert Sibande MP306: Dipaleseng 9 454 778 8.2 8 676 91.8 9 574 564 5.9 9 010 94.1 Mpumalanga DC30: Gert Sibande MP307: Govan Mbeki 49 675 5 165 10.4 44 510 89.6 67 580 2 852 4.2 64 728 95.8 Mpumalanga DC31: Nkangala MP311: Delmas 12 355 2 027 16.4 10 328 83.6 13 953 533 3.8 13 420 96.2 PART III KEY HOUSEHOLD SERVICES INDICATORS 275 Table 16: (continued) Local municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province 276 District Municipality Local Municipality 1996 Total number of households 2001 No access/ no nearby access With access/ nearby access Number Number % Total number of households % No access/ no nearby access With access/ nearby access Number Number % % Mpumalanga DC31: Nkangala MP312: Emalahleni 56 469 5 645 10.0 50 824 90.0 82 241 3 919 4.8 78 322 95.2 Mpumalanga DC31: Nkangala MP313: Middelburg 33 644 3 685 11.0 29 959 89.0 37 041 1 992 5.4 35 049 94.6 Mpumalanga DC31: Nkangala MP314: Highlands 9 302 2 795 30.0 6 507 70.0 10 900 1 724 15.8 9 176 84.2 Mpumalanga DC31: Nkangala MP315: Thembisile 48 099 8 659 18.0 39 440 82.0 58 802 1 559 2.7 57 243 97.3 Mpumalanga DC31: Nkangala MP316: Dr JS Moroka 48 347 10 274 21.3 38 073 78.7 54 326 2 159 4.0 52 167 96.0 Mpumalanga DC32: Ehlanzeni MP321: Thaba Chweu 20 128 4 778 23.7 15 350 76.3 26 559 3 391 12.8 23 168 87.2 Mpumalanga DC32: Ehlanzeni MP322: Mbombela 91 615 21 995 24.0 69 620 76.0 121 952 9 274 7.6 112 678 92.4 Mpumalanga DC32: Ehlanzeni MP323: Umjindi 11 681 4 338 37.1 7 343 62.9 15 855 2 844 17.9 13 011 82.1 Mpumalanga DC32: Ehlanzeni MP324: Nkomazi 53 105 16 786 31.6 36 319 68.4 75 555 11 076 14.7 64 479 85.3 Limpopo DC33: Mopani NP331: Greater Giyani 42 183 25 403 60.2 16 780 39.8 52 859 4 769 9.0 48 090 91.0 Limpopo DC33: Mopani NP332: Greater Letaba 41 465 19 694 47.5 21 771 52.5 53 734 7 044 13.1 46 690 86.9 Limpopo DC33: Mopani NP333: Greater 73 898 36 669 49.6 37 229 50.4 97 375 10 536 10.8 86 839 89.2 Limpopo DC33: Mopani NP334: Ba-Phalaborwa 25 577 7 926 31.0 17 651 69.0 33 533 3 477 10.4 30 056 89.6 Limpopo DC34: Vhembe NP341: Musina 8 401 1 885 22.4 6 516 77.6 13 954 4 058 29.1 9 896 70.9 Limpopo DC34: Vhembe NP342: Mutale 13 113 10 948 83.5 2 165 16.5 17 646 5 538 31.4 12 108 68.6 Limpopo DC34: Vhembe NP343: Thulamela 101 760 47 042 46.2 54 718 53.8 129 155 12 404 9.6 116 751 90.4 Limpopo DC34: Vhembe NP344: Makhado 88 977 40 505 45.5 48 472 54.5 113 525 9 153 8.1 104 372 91.9 Limpopo DC35: Capricorn NP351: Blouberg 28 016 14 340 51.2 13 676 48.8 35 166 6 483 18.4 28 683 81.6 Limpopo DC35: Capricorn NP352: Aganang 27 584 9 624 34.9 17 960 65.1 32 522 1 786 5.5 30 736 94.5 Limpopo DC35: Capricorn NP353: Molemole 22 668 6 667 29.4 16 001 70.6 28 929 3 339 11.5 25 590 88.5 Limpopo DC35: Capricorn NP354: Polokwane 85 611 22 658 26.5 62 953 73.5 135 433 8 239 6.1 127 194 93.9 Limpopo DC35: Capricorn NP355: Lepele-Nkumpi 44 373 16 878 38.0 27 495 62.0 52 904 3 864 7.3 49 040 92.7 Limpopo DC36: Waterberg NP361: Thabazimbi 14 466 3 357 23.2 11 109 76.8 25 023 1 604 6.4 23 419 93.6 Limpopo DC36: Waterberg NP362: Lephalale 21 218 5 856 27.6 15 362 72.4 28 334 4 484 15.8 23 850 84.2 THE DBSA INFRASTRUCTURE BAROMETER Table 16: (continued) Local municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province District Municipality Local Municipality Limpopo DC36: Waterberg NP364: Mookgopong Limpopo DC36: Waterberg Limpopo 1996 Total number of households 2001 No access/ no nearby access With access/ nearby access Number Number % Total number of households % No access/ no nearby access With access/ nearby access Number Number % % 5 019 929 18.5 4 090 81.5 9 563 1 711 17.9 7 852 82.1 NP365: Modimolle 12 031 1 655 13.8 10 376 86.2 20 936 2 482 11.9 18 454 88.1 DC36: Waterberg NP366: Bela-Bela 11 165 1 939 17.4 9 226 82.6 14 160 1 404 9.9 12 756 90.1 Limpopo DC36: Waterberg NP367: Mogalakwena 53 716 18 748 34.9 34 968 65.1 70 081 8 551 12.2 61 530 87.8 Limpopo CBDC3: Sekhukhune NP03A2: Makhuduthamaga 49 943 29 881 59.8 20 062 40.2 54 203 8 528 15.7 45 675 84.3 Limpopo CBDC3: Sekhukhune NP03A3: Fetakgomo 17 360 13 026 75.0 4 334 25.0 19 001 6 640 34.9 12 361 65.1 Limpopo CBDC4: Bohlabela NP04A1: Maruleng 18 364 11 415 62.2 6 949 37.8 23 032 4 364 18.9 18 668 81.1 Northern Cape/ North West CBDC1: Kgalagadi CBLC1: Ga-Segonyana 13 174 5 620 42.7 7 554 57.3 17 762 2 638 14.9 15 124 85.1 Gauteng/ Mpumalanga CBDC2: Metsweding CBLC2: Kungwini 18 244 1 907 10.5 16 337 89.5 33 561 1 606 4.8 31 955 95.2 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBLC3: Greater Marble Hall 19 388 6 417 33.1 12 971 66.9 26 538 3 274 12.3 23 264 87.7 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBLC4: Greater Groblersdal 42 245 19 079 45.2 23 166 54.8 48 748 5 088 10.4 43 660 89.6 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBLC5: Greater Tubatse 42 526 27 528 64.7 14 998 35.3 56 218 12 508 22.2 43 710 77.8 Limpopo/ Mpumalanga CBDC4: Bohlabela CBLC6: Bushbuckridge 112 986 51 216 45.3 61 770 54.7 109 667 10 612 9.7 99 055 90.3 Northern Cape/ North West DC9: Frances Baard CBLC7: Phokwane 13 406 2 329 17.4 11 077 82.6 17 078 2 016 11.8 15 062 88.2 North West/ Gauteng CBDC8: West Rand CBLC8: Merafong City 39 801 3 504 8.8 36 297 91.2 99 652 3 419 3.4 96 233 96.6 Western Cape DC1: West Coast WCDMA01: West Coast 1 097 157 14.3 940 85.7 1 177 68 5.8 1 109 94.2 Western Cape DC2: Boland WCDMA02: Breede River 1 594 274 17.2 1 320 82.8 1 930 132 6.8 1 798 93.2 Western Cape DC3: Overberg WCDMA03: Overberg 12 0 0.0 12 100.0 80 3 3.8 77 96.3 Western Cape DC4: Eden WCDMA04: South Cape 2 875 338 11.8 2 537 88.2 3 551 247 7.0 3 304 93.0 Western Cape DC5: Central Karoo WCDMA05: Central Karoo 1 558 509 32.7 1 049 67.3 1 566 251 16.0 1 315 84.0 Eastern Cape DC10: Cacadu ECDMA10: Aberdeen Plain 1 942 177 9.1 1 765 90.9 2 017 123 6.1 1 894 93.9 Eastern Cape DC13: Chris Hani ECDMA13: Mountain Zebra National Park 22 0 0.0 22 100.0 18 0 0.0 18 100.0 Eastern Cape DC14: Ukhahlamba ECDMA14: Oviston Nature Reserve 0 0 0.0 0 0.0 3 0 0.0 3 100.0 Eastern Cape DC44: Alfred Nzo ECDMA44: O’Conners Camp 0 0 0.0 0 0.0 0 0 0.0 0 0.0 PART III KEY HOUSEHOLD SERVICES INDICATORS 277 Table 16: (continued) Local municipalities: Households with access or nearby access to telephones, 1996 and 2001 Province District Municipality Local Municipality Northern Cape DC6: Namakwa NCDMA06: Namaqualand Northern Cape DC7: Karoo Northern Cape 1996 Total number of households 2001 No access/ no nearby access With access/ nearby access Number Number % Total number of households % With access/ nearby access Number Number % % 564 62 11.0 502 89.0 342 55 16.1 287 83.9 NCDMA07: Bo Karoo 1 290 136 10.5 1 154 89.5 1 098 113 10.3 985 89.7 DC8: Siyanda NCDMA08: Benede Oranje 2 540 670 26.4 1 870 73.6 3 243 181 5.6 3 062 94.4 Northern Cape DC9: Frances Baard NCDMA09: Diamondfields 1 076 456 42.4 620 57.6 1 614 252 15.6 1 362 84.4 Northern Cape CBDC1: Kgalagadi NCDMACB1: Kalahari 1 882 165 8.8 1 717 91.2 2 488 170 6.8 2 318 93.2 Free State DC19: Thabo Mofutsanyane FSDMA19: Golden Gate Highlands National Park 119 7 5.9 112 94.1 59 0 0.0 59 100.0 Kwazulu-Natal DC22: UMgungundlovu KZDMA22: Highmoor/ Kamberg Park 152 67 44.1 85 55.9 12 0 0.0 12 100.0 Kwazulu-Natal DC23: Uthukela KZDMA23: Gaints Castle Game Reserve 75 0 0.0 75 100.0 217 0 0.0 217 100.0 Kwazulu-Natal DC27: Umkhanyakude KZDMA27: St Lucia Park 1 612 1 179 73.1 433 26.9 1 285 329 25.6 956 74.4 Kwazulu-Natal DC43: Sisonke KZDMA43: Mkhomazi Wilderness Area 311 29 9.3 282 90.7 330 45 13.6 285 86.4 North West DC37: Bojanala NWDMA37: Pilansberg National Park 96 1 1.0 95 99.0 121 3 2.5 118 97.5 Gauteng CBDC8: West Rand GTDMA41: West Rand 971 94 9.7 877 90.3 2 010 60 3.0 1 950 97.0 Mpumalanga DC31: Nkangala MPDMA31: Mdala Nature Reserve 5 5 100.0 0 0.0 0 0 0.0 0 0.0 Mpumalanga DC32: Ehlanzeni MPDMA32: Lowveld 0 0 0.0 0 0.0 262 34 13.0 228 87.0 Limpopo/ Mpumalanga CBDC3: Sekhukhune CBDMA3: Schuinsdraai Nature Reserve 9 0 0.0 9 100.0 0 0 0.0 0 0.0 Limpopo/ Mpumalanga CBDC4: Bohlabela CBDMA4: Kruger Park 538 89 16.5 449 83.5 2 294 139 6.1 2 155 93.9 5 841 979 2 048 764 35.1 3 793 215 64.9 7 479 971 986 083 13.2 6 493 888 86.8 Total Note: 0 (zero) households: information is not available 278 No access/ no nearby access THE DBSA INFRASTRUCTURE BAROMETER PART III KEY HOUSEHOLD SERVICES INDICATORS 279 280 THE DBSA INFRASTRUCTURE BAROMETER PART III KEY HOUSEHOLD SERVICES INDICATORS 281 282 THE DBSA INFRASTRUCTURE BAROMETER PART III KEY HOUSEHOLD SERVICES INDICATORS 283 284 THE DBSA INFRASTRUCTURE BAROMETER PART III KEY HOUSEHOLD SERVICES INDICATORS 285 286 THE DBSA INFRASTRUCTURE BAROMETER PART III KEY HOUSEHOLD SERVICES INDICATORS 287 288 THE DBSA INFRASTRUCTURE BAROMETER PART III KEY HOUSEHOLD SERVICES INDICATORS 289 290 THE DBSA INFRASTRUCTURE BAROMETER PART III KEY HOUSEHOLD SERVICES INDICATORS 291 292 THE DBSA INFRASTRUCTURE BAROMETER PART III KEY HOUSEHOLD SERVICES INDICATORS 293 294 THE DBSA INFRASTRUCTURE BAROMETER PART III KEY HOUSEHOLD SERVICES INDICATORS 295 296 THE DBSA INFRASTRUCTURE BAROMETER Bibliography MOUTON AJ. 2004. Municipal Statistical Infrastructure Review, 1996 and 2001. DBSA, Midrand STATISTICS SOUTH AFRICA. 2004. Population Census, 2001. Community Profile databases. Pretoria. STATISTICS SOUTH AFRICA. 1999. Population Census, 1996. Community Profile databases. Pretoria. PART III KEY HOUSEHOLD SERVICES INDICATORS 297 Addresses Development Bank of Southern Africa Limited Postal address PO Box 1234, Halfway House Midrand, South Africa 1685 Telephone +27 11 313 3911 Fax +27 11 313 3086 Website www.dbsa.org CSIR Boutek Postal address PO Box 395 PRETORIA 0001 Telephone +27 12 841 2579 Fax +27 12 841 2703 Website www.csir.co.za Photographic credits Trans African Concessions: p. 1 DBSA: pp. 60, 61 Gauteng Tourism Authority (GTA): pp. 31, 59, 93, 99 Eskom: pp. 48, 134 www.trekearth.com: p. 96 Henner Frankenfeld / PictureNET Africa: p. 156 Hewlett Packard South Africa: p. 180 298 THE DBSA INFRASTRUCTURE BAROMETER 2006 Economic and Municipal Infrastructure in South Africa THE DBSA INFRASTRUCTURE BAROMETER 2006 THE DBSA INFRASTRUCTURE BAROMETER Economic and Municipal Infrastructure in South Africa
