1. BACKGROUND 
 
1.1 The Bill emanates from a project of the Department of Water Affairs and Forestry to restructure the South African national water resources infrastructure. Over the past few years there has been an emerging recognition of the need for a stronger public sector in the key area of infrastructure development, effective maintenance, operation and management of existing infrastructure to support social and economic development. 
 
1.2 The importance of water for social and economic development has been a high priority of Government since 1994. In order to meet the constitutional obligations of section 27(1)(b) of the Constitution and to achieve the strategic objectives of Government to eradicate poverty and to ensure sustainable and equitable development, the National Water Resources Infrastructure Agency Limited (the Agency) must be established. The importance of national water resources infrastructure as an element of South African economic infrastructure has also been increasingly recognised. 
 
1.3 While the social and economic dimensions of water resources management are fundamentally linked, the financing and development of large-scale water resources infrastructure is driven by the requirements for economic use, which can be used to leverage supply for social purposes development and assessing viability of the investment. 
 
1.4 In addition to the development, operation and maintenance of national water resource infrastructure, there is a need to ensure that the value of this national asset is effectively maintained and sustained in order to minimise the risk to end-users. 
 
1.5 Currently, the Department of Water Affairs and Forestry cannot raise capital directly on the financial markets, and is reliant on special-purpose vehicles, such as the Trans-Caledon Tunnel Authority, to finance and implement viable economic projects. 
 
1.6 The establishment of the Agency, therefore, fulfils the requirement of the management of water resources infrastructure to achieve the economic, social and water resources management objectives of Government and obligations in terms of section 27(1)(b) of the Constitution. 
 
1.7 The establishment of the Agency has the advantage of an institution that separates the policy development and regulatory responsibilities of the Department, as the custodian of the national water resources, from the development and implementation responsibilities for infrastructure management. 
 
1.8 The Bill seeks to incorporate and establish the Agency as a juristic person under the sole ownership of the State. The Agency is to be registered in terms of the Companies Act, 1973 (Act No. 61 of 1973), and will be known as the South African National Water Resources Infrastructure Agency Limited. The rights of the State will be exercised by the Minister of Water Affairs and Forestry. The governance of the Agency will vest in the Board of the Agency. 
 
2. OBJECTS OF BILL 
 
2.1 The objects of the Bill can be summarised as follows: 
 
(a) To establish a juristic person under the ownership and control of the State in order to administer, fund, finance, develop, operate, maintain, manage and provide advisory services in respect of national water resources infrastructure in an efficient and cost-effective manner to meet the social and economic developmental needs of current and future water users within the framework of national government policy and in accordance with section 27(1)(b) of the Constitution; 
 
(b) to ensure the sustainable, equitable and reliable supply of water to meet nationally and regionally defined social and economic objectives of government; 
 
(c) to transfer national government waterworks to the Agency; 
 
(d) to alleviate the burden on the State's resources in water resources development; 
 
(d) to provide for the disestablishment of the Trans-Caledon Tunnel Authority (TCTA) and the transfer of all its assets, liabilities, rights, obligations, powers, Treaty and non-Treaty functions as a going concern into the Agency. 
 
2.2 The Bill contains the following: 
 
(a) A long title: a short description of the contents of the Bill. 
 
(b) A preamble: setting out that National Government is responsible for and has authority over the nation's water resources and its use and acknowledging that it is necessary that national water resources infrastructure must be funded, developed, operated and maintained efficiently and effectively in a sustainable and reliable manner to make water available to water users and that this can be more commercially viable by providing for the utilisation of private sector funds to achieve social and economic objectives of Government and meet the obligations of section 27 of the Constitution. 
 
(c) Clause 1: definitions. 
 
(d) Clause 2: the purpose of the Act, with special reference to the fact that the Agency as a juristic person, owned and controlled by the State, will take over all aspects dealing with the operation and maintenance of national water resources infrastructure and serve and achieve the development and transformation objectives of Government relating to service delivery, social and economic development. 
 
(e) Clause 3: the establishment of the Agency as a company. 
 
(f) Clause 4: the registration of the Agency's memorandum and articles of association in terms of the Companies Act, 1973; 
 
(g) Clause 5: the application of the Companies Act, 1973, to the Agency. 
 
(h) Clause 6: the objects of the Agency which detail that the Agency must develop and manage infrastructure to ensure the sustainable, equitable and reliable supply of water from national water resources infrastructure. 
 
(i) Clause 7: the functions of the Agency. Extensive powers are conferred upon the Agency in order to enable it to realise the purpose of the Bill. The Agency may also carry out functions by giving support to other water management institutions and water services providers. This support will not include financial support but will be technical and advisory in its nature. Further, with the required approval the Agency may perform its functions outside the Republic of South Africa. This Clause also sets out that the Treaty functions of the TCTA will be taken over by the Agency. 
 
(j) Clause 8: the governance and composition of Board. This Clause sets out that the Agency is governed by and acts through its Board which is its accounting authority and is subject to the Public Finance Management Act, 1999 (Act No. 1 of 1999). The Board will consist of between seven and nine executive and non-executive members and the Chief Executive Officer, being the executive member. 
 
(k) Clause 9: the role of the Board. This includes, among others, that the Board must retain effective control over the Agency and approve the strategy, policy and systems of the Agency to achieve the objectives of the Agency. 
 
(l) Clause 10: appointment to the Board. The non-executive members will be appointed by the Minister on the recommendation of a nomination committee. Due consideration must be given to the need for representation by previously disadvantaged persons due to past racial, gender and other discrimination. 
 
(m) Clause 11: The chairperson and deputy chairperson. The Minister will make these appointments. 
 
(n) Clause 12: The terms of office and conditions of appointment of Board members. Terms are for three years, with the right of re-appointment and with the remuneration approved by the Minister in consultation with the Minister of Finance. 
 
(o) Clause 13: removal and disqualification of Board member. 
 
(p) Clause 14: filling of vacancies. 
 
(q) Clause 15: the shareholder's compact. A shareholder compact need to be concluded within six months from the date on which the Board is appointed. 
 
(r) Clause 16: establishment of committees. The Board may establish committees to support the effective functioning of the Board. 
 
(s) Clause 17: the fiduciary duties of Board members. 
 
(t) Clause 18: the disclosure of interest of a Board member. 
 
(u) Clause 19: the recovery of improper profits. 
 
(v) Clause 20: the validity of decisions. 
 
(w) Clause 21: delegation of functions by Board. The Board may delegate certain of its functions to the Chief Executive Officer, a Board member or a committee. Certain powers may not be delegated. 
 
(x) Clause 22: meetings of Board. The Board will regulate on procedures for its meetings. A quorum of the Board will be provided for in the articles of association. 
 
(y) Clause 23: the appointment of the Chief Executive Officer and the Chief Financial Officer. The Chief Executive Officer is appointed by the Minister upon the recommendation of the Board. The Chief Financial Officer is appointed by the Chief Executive Officer with the approval of the Board. The functions of these officers are also set out in this Clause. 
 
(z) Clause 24: the term of office and condition of appointment. The Chief Executive Officer and the Chief Financial Officer are appointed for a term of three years with re-appointment for a further period of three years at a time. Remuneration is determined by the Board. 
 
(za) Clause 25: appointment of acting Chief Executive Officer and Acting Chief Financial Officer. 
 
(zb) Clause 26: interim Chief Executive Officer. 
 
(zc) Clause 27: the suspension from office of Chief Executive Officer. 
 
(zd) Clause 28: the delegation by Chief Executive Officer.

To provide for the incorporation and establishment of the South African National Water Resources Infrastructure Agency Limited as a juristic person owned and controlled by the State to administer, fund, finance, provide, operate, maintain and provide advisory services in respect of national water resources infrastructure in accordance with section 27(1)(b) of the Constitution and national policy; to provide for the transfer of assets and certain liabilities to the South African National Water Resources Infrastructure Agency Limited from the Trans-Caledon Tunnel Authority; to provide for the disestablishment of the Trans-Caledon Tunnel Authority; and to provide for matters connected therewith.