In his 2026 State of the Nation Address, President Cyril Ramaphosa acknowledged the deepening national water crisis and confirmed the establishment of a President-chaired National Water Committee to coordinate urgent intervention across government.

Against this backdrop, Parliament is considering the Water Services Amendment Bill, 2025 (Bill), which proposes significant amendments to the Water Services Act 108 of 1997.

One of the key motivating factors for the Bill is the recognition of widespread service delivery failures at the municipal level, including poor maintenance of water infrastructure and non-functional wastewater treatment.

The Bill accordingly aims to strengthen regulation, oversight and enforcement within the water services sector, and is intended to complement executive efforts to stabilise infrastructure, governance and service delivery.

POLICY CONTEXT: FROM CRISIS RESPONSE TO REGULATORY REFORM

The establishment of a National Water Committee signals a shift toward stronger national coordination in addressing systemic municipal failures.

The Bill operationalises this policy direction by:

• introducing a mandatory licensing regime for water services providers;
• expanding the Minister’s enforcement powers;
• reforming governance of water boards; and
• introducing enhanced penalties and personal liability provisions.

KEY PROPOSED AMENDMENTS

Mandatory Licensing of Municipal Service Delivery Mechanisms

A central feature of the Bill is the introduction of a water services licensing system.

The proposed Bill provides that no person may operate as a municipal service delivery mechanism unless licensed, and seeks to establish a specific licensing authority to regulate the application process.

Licences will include conditions relating to governance, technical capacity and reporting. Sections 22E and 22F empower the licensing authority to direct rectification, suspend or revoke licences where requirements are not met.

This represents a material shift from the current regime, where municipalities appoint service providers without national licensing approval.

Strengthened Ministerial Enforcement Powers

The Bill substitutes the existing “Monitoring and Intervention” framework with a strengthened “Monitoring and Enforcement” regime.

Section 62A empowers the Minister to issue written directives requiring rectification of contraventions. If non-compliance persists, the Minister may approach a court for appropriate relief.

This aligns the Water Services Act more closely with enforcement mechanisms seen in other regulatory frameworks and signals a move toward more direct national oversight.

Appointment and Powers of Authorised Persons

The Bill introduces “authorised persons” appointed by the Minister to enforce compliance.

Their powers include:

• Entry and inspection of water services works;
• Questioning of individuals;
• Copying and removal of documents;
• Search and seizure of items and vehicles (on warrant);
• Exercising peace officer powers in certain circumstances; and

This significantly expands inspection and compliance capacity within the sector.

Governance Reform of Water Boards

The Bill overhauls water board governance structures to align with national public entity standards.

Reforms include:

• Prescribed minimum qualifications and expertise requirements for board members (section 35B);
• Formalised appointment processes;
• Mandatory shareholder compacts (section 35G);
• Establishment of audit, risk and social & ethics committees (section 35H); and
• Explicit fiduciary duties aligned with the Companies Act and the Public Finance Management Act (section 35I).

These provisions mirror broader state-owned enterprise governance reforms and are intended to enhance accountability and professional oversight.

Enhanced Offences and Personal Liability

The Bill strengthens criminal penalties, introducing fines of up to R10 million or imprisonment for up to 10 years for certain offences.

Section 82A introduces personal liability for directors of business entities and municipal managers where offences result from failure to take reasonable preventative steps and where the director had knowledge of the offence. Courts may order recovery of financial advantage gained or losses incurred.

This materially increases executive-level compliance exposure.

Transitional Provisions

Clause 28 provides that existing municipal service delivery mechanisms may continue operating upon commencement but must apply for licences within 12 months of publication of the licensing notice (extendable by six months).

The Act will commence on a date determined by Presidential proclamation.

POTENTIAL SHORTCOMINGS

If enacted in its current form, interested parties have noted the following criticisms and potential shortcomings of the Bill, namely:

• the Bill does not address current political failures – South Africa already has a modern water law framework, however poor service arising primarily from weak political oversight, poor leadership and a lack of consequence remains the root cause of the current water crisis;
• over-concentration of regulatory powers- the Bill centralises licensing, regulatory and enforcement powers within the Department of Water and Sanitation, which may create a conflict of interest where the Department could effectively act as both regulator and service provider. The Bill should rather establish an independent water regulator to ensure impartial oversight and credible enforcement rather than concentrating these powers within the Department; and
• Reform requires financial stability – while the proposed governance reforms for water boards are welcomed, these reforms will not succeed without financial sustainability, predictable infrastructure investment and stronger coordination between water boards and municipalities, all of which has been severely lacking in water service delivery to date.

HOW BISHOP FRASER ATTORNEYS CAN ASSIST

The Water Services Amendment Bill signals a decisive shift toward stricter regulation and enforcement in the water sector.

Bishop Fraser Attorneys advises on regulatory compliance audits, governance restructuring, licensing processes and administrative law challenges.. Early engagement may reduce future regulatory exposure as the sector enters a more enforcement-driven phase.