Finance Minister Malusi Gigaba cracked opened a R6bn war chest to assist areas in the country hardest hit by drought, particularly the Western Cape and Cape Town.

The R6bn is part of an augmentation programme in response to the water challenges various areas in the country have faced since 2015 and the subsequent drought in the Western Cape region, which is the worst the country has seen in a century.

“A provisional allocation of R6bn has been set aside in 2018-19 for several purposes, including drought relieve and to augment public infrastructure investment…. Allocation for drought response funds for water infrastructure projects and Expanded Public Works Programme will be made in the adjustment budget,” said Gigaba.

Municipal grants would be provided to provincial governments and municipalities battling with water challenges, he said, in line with the work of the government’s interministerial committee on water scarcity.

“To provide short-term assistance, this budget includes disaster relief grants for provinces and municipalities worth R473m in 2018-19. Other conditional grants can also be reprioritised to respond to disasters if necessary,” he said.

The 2018 budget says that in recent years SA has experienced various natural disasters, ranging from floods to droughts, to which the Department of Water and Sanitation is responsible for responding.

“For this purpose, the department administers the disaster relief grant to provide for immediate relief as and when disasters occur. Allocations to the grant have increased significantly, from R118.1m in 2016-17 to R423.7m in 2017-18 and are expected to increase further at an average annual rate to 5.1% over the medium term, to R492.4m in 2020-21,” according to its estimates.

The Department of Water and Sanitation’s total expenditure is expected to increase at an average annual rate of 3.7%, from R15.6bn in 2017-18 to R17.4bn in 2020-21. Allocations to the Water Infrastructure Development Programme will account for 80.6% (R39.7bn) of this amount.

According to estimates of budget expenditure, spending in the water intervention programme is mainly driven by transfers to water boards for the provision of regional bulk infrastructure as well as transfers to the Water Trading Entity and the Accelerated Community Infrastructure Programme subprogramme.

According to the budget estimates, with reductions of R3.1bn to these transfers and subprogrammes over the medium term, allocations to the Water Infrastructure Development Programme increase at below inflation, at an average annual rate of 3%, from R12.8bn in 2017-18 to R14bn in 2020-21.