New Water Tariff Framework Set to Enhance Affordability and Sustainability

The Minister of Water and Sanitation, Senzo Mchunu, has endorsed the updated Norms and Standards, which introduce a multi-year tariff system.

The Department of Water and Sanitation has unveiled a comprehensive revision of the Norms and Standards for water tariff setting, aimed at providing a clear and sustainable financial framework for water service providers.

The Minister of Water and Sanitation, Senzo Mchunu, has endorsed the updated Norms and Standards, which introduce a multi-year tariff system. This system is designed to assist all water users in long-term planning, ensuring that water services remain affordable and payments are made promptly.

The revised Norms and Standards, which will take effect from April 1, 2026, also shed light on the tariffs applicable to waterborne sanitation services. These amendments, gazetted on May 27, 2024, represent the first major update since April 2002 and establish a structured approach for setting tariffs by bulk water providers, water services authorities, and for sanitation services.

The updated framework aims to fund service delivery effectively, adhering to the technical Norms and Standards outlined in Section 9 of the Water Services Act.

The department emphasizes that the key goals of the revised tariff setting guidelines are to ensure transparency, predictability, and consistency. These principles are fundamental to maintaining the sustainability of water service provision, offering fair and affordable services to consumers, and fostering trust and accountability among service providers.

The new Norms and Standards introduce a multi-year tariff determination process, which includes provisions for various tariff types such as those for drought periods, seasonal use, and penalties aimed at water conservation and demand management. The revisions also provide a more robust framework for setting sanitation tariffs and specify the requirements for disclosure.

The need for these revisions arose from significant changes within the public sector that have influenced the water and sanitation services sector. These include the enactment of several legislative acts, such as the Local Government, Municipal Finance Management Act of 2003, the Municipal Fiscal Powers and Functions Act of 2007, and the Municipal Systems Act of 2000.

To ensure a smooth transition, the department plans to engage with stakeholders and roll out the new Norms and Standards from October 2024 through March 2025.