WATER BOARDS
As the North West province’s sole water board, Magalies Water is relentless in its endeavour to respond to the current bulk water challenges. By Kirsten Kelly Vaalkop Water Treatment Plant (270 Mℓ/day)
F
ounded in 1969, Magalies Water has evolved from an entity that exclusively ensured water security for the mining industry in the platinum belt region of Rustenburg and Thabazimbi, to extending its services to the communities surrounding those mines. “Today, our end-customer base lies around 25% mines and 75% communities,” states Sandile Psychology Mkhize, CEO, Magalies Water. As a bulk water supplier, Magalies Water does not provide water directly to those communities, but rather to the municipalities that supply them.
Expansion
In July 2022, Sedibeng Water was disestablished, and its operations incorporated into Bloem Water and Magalies Water. While Bloem Water (now
Sandile Mkhize, CEO, Magalies Water
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THE EVOLUTION OF MAGALIES WATER called Vaal Central Water) took over the operations in the Northern Cape and Free State, Magalies Water took over Sedibeng Water’s assets, operations, staff, and liabilities in the North West province. “This was a huge undertaking. First, water utilities are graded according to their size: from grade A (a huge bulk water supplier scheme) to grade D (small water entity). Sedibeng Water had a grade B2 rating (a Hay points score of 1 372) while Magalies Water at that time had a grade C1 (1 192 Hay points). This grading determines different salary levels, so upon the merge, we had employees performing the same job functions earning different salaries. Second, we absorbed close to 400 employees from Sedibeng Water, with an almost non-existent water production asset base. To put this into perspective, Magalies Water at the time had 320 employees and a R4.5 billion asset base,” explains Mkhize.
This meant that Magalies Water’s revenue-producing assets must now sustain over 700 employees. Considering that the water tariffs are low and were already pre-approved by Parliament for implementation effective from 1 July 2022, Magalies Water had little room to move. This is compounded by the fact that Magalies Water’s debt book moved from R300 million to over R2.4 billion after absorbing operations from Sedibeng Water. “As a result, we have started working on the bulk water and sanitation masterplan for the newly acquired area. We will also be approaching National Treasury for funding of the non-economic component of the infrastructure development, and development funding institutions for the loan funding of the economic component of this infrastructure development,” says Mkhize. In addition to challenges resulting from the merge, Magalies Water is also
