THE government has decentralised the management of water from the bungling Zimbabwe National Water Authority (Zinwa) to local councils, while utilities authorities have been given the greenlight to charge in foreign currency with effect from next month.
In the 2009 National Budget presentation yesterday, acting Finance minister Patrick Chinamasa said the decentralisation would result in Zinwa, which has been criticised for failure to effectively manage water supplies and sewer reticulation throughout the country’s urban centres, reverting to its role prior to May 9 2005.
“The centralisation of water management in Zinwa has been characterised by bureaucratic inefficiencies, leading to low staff morale,” Chinamasa said. “This entails that Zinwa reverts back to its status prior to the directive of May 9 2005. Accordingly, Zinwa and local authorities should begin the processes for smooth hand over and take over transfers.”
He said government would work with the respective local authorities in mobilising resources for the rehabilitation of obsolete reticulation infracture.
“The charging of economic water tariffs will complement such resource mobilisation measures,” he added.
He said: “Government is therefore empowering local authorities and public enterprises such as Zimbabwe Electricity Supply Authority (Zesa), Zinwa, and National Oil Company of Zimbabwe (Noczim) among others, to charge for their services in both local and foreign currencies.”
He said this would be complemented by the periodic review of tariffs to economic levels, which would allow institutions to cover operational costs consistent with the ‘user pays’ principle.
Chinamasa said to enable Noczim to raise sufficient funds to import fuel on a sustainable basis without reverting either to treasury or the Reserve Bank for foreign currency, all customers —— government and farmers included —— would pay the full price in foreign exchange.
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He also announced the adjusted electricity tariff.
“Based on the already government approved cost plus approach, the electricity tariff is being adjusted with effect from February 1 to 47% from the current US$0,67 to US$0,98 per kilowatt per hour in order for Zesa to recover costs of supply. This is payable in both local and foreign currency.”
A tariff regime providing for a lifeline tariff of up to 50 kWh hours for domestic consumers would be used to provide for continued subsidisation of low income households, while cost reflective tariffs will be charged on other consumer categories.
Farmers will from next month pay 80% of the obtaining tariff level in order to maintain sustainability.
“With regards to farmers, who remain the anchor of our agricultural reforms, while government recognises the need to cushion them, the current subsidy of 55% of the tariff being paid by the farmers is not sustainable,” Chinamasa said. “Farmers will therefore pay 80% of the obtaining tariff level with effect from February 1.”
BY LUCIA MAKAMURE
