Water losses, weak municipalities: Treasury's own reform scorecard

Finance Minister Enoch Godongwana used the Medium-Term Budget Policy Statement to argue that government’s structural reform programme is doing real work in South Africans’ daily lives, and to concede where it is not yet.

“The structural reforms are not abstract policy measures. They affect the daily lives of South Africans,” he told Parliament on Wednesday.

His example was water. Poorly maintained infrastructure, high water losses and weak municipal capacity have undermined service delivery, he said. Government’s answer is the National Water Action Plan, which the Minister said focuses not only on infrastructure but on fixing the institutions responsible for delivering water services. The stated priorities are restoring operational performance, strengthening governance and technical capacity, reducing water losses, improving revenue collection and reforming how water infrastructure is financed.

“By addressing both infrastructure and institutional weaknesses, we are laying the foundation for reliable water services and stronger local economies,” Godongwana said.

According to the Treasury documents summarised by SAnews (South African Government News Agency), the year’s progress across the reform sectors runs as follows.

In electricity, the wholesale electricity market was launched internally with 32 participants, and Eskom recorded a profit for a second year. The Department of Electricity and Energy has published policy guidance on market design and a revised pricing policy, and work on a fully independent transmission system operator is described as progressing well. Since a task team was established in March 2026, the President has approved its Phase 1 report, with the detailed transaction structure and implementation plan due in a second report by year end. The next step is to finalise trading rules and open the wholesale market externally in 2027.

In logistics, Transnet recorded a profit in the 2025/26 financial year and published its Revised Network Statement. Eleven private train operators will start running on the freight network in 2027, and Cabinet has approved the approach to separating out the Transnet National Ports Authority as an independent entity. The Transport Economic Regulator is building toward full functionality in April 2027, and the Transnet Rail Infrastructure Manager has published revised rules for private rail operators after industry feedback.

On water, the SA National Water Resources Infrastructure Agency board and acting CEO were appointed and WATERCOM was established. The National Water Crisis Committee was set up this year to oversee the National Water Action Plan. SANWRIA will finance and develop national dams and transfer schemes using its own balance sheet, and the Water Partnerships Office has been folded into the Infrastructure Finance and Implementation Support Agency, with a pipeline exceeding R60 billion now in the financing stage.

On rail, passenger journeys rose from about 39 million in 2023/24 to 101 million in 2025/26, which Treasury attributes largely to signal modernisation, rolling stock replacement and other infrastructure rollouts. The Passenger Rail Agency of South Africa is targeting 232 million journeys in 2028/29. Treasury separately records journeys up five times from 17 million in 2021/22 to 101 million in 2025/26.

On visas, the Electronic Travel Authorisation programme is live, has reached 200 000 applications and allows for 24-hour approvals.

On local government, the Public Service Commission Bill was enacted in September and the eight metro municipalities joined the Metro Trading Services Reform programme. Treasury describes stronger action to address financial mismanagement in municipalities alongside interventions to improve revenue collection, and says the reforms institutionalise financial discipline through amendments to the Municipal Finance Management Act. New public-private partnership regulations and incentives for municipalities to reinvest water, electricity and waste revenue into infrastructure form part of the package. The assent of the PSC Bill strengthens the Commission’s ability to monitor, investigate and intervene in municipalities and, in Treasury’s words, “separates political interference from administrative duties”. The White Paper on Local Government is due to be launched this week.

Treasury is explicit that the local government programme is at different stages of maturity. The Metro Trading Services Reform Programme and the Smart Meters Grant Programme are in implementation. The White Paper and the Public Service Commission Act are moving to implementation. The local government fiscal framework review, the MFMA review, the Water Services Amendment Bill and digital transformation interventions are in design, drafting or processing.

This account is drawn from the MTBPS documents as summarised by SAnews, the government news agency, rather than from the full text of the statement. The source is at https://www.sanews.gov.za/south-africa/reform-programme-not-abstract-policy-measures.