RAND WATER ANNUAL REPORT 2023

Consolidated Annual Financial Statements for the year ended 30 June 2023

Board Report 12. Events after the reporting date

Reconfiguration of Rand Water and Magalies Water On 15 July 2022, the Minister formally communicated the intention to embark on the proposed reconfiguration of Rand Water and Magalies Water to improve the institutional landscape in the water sector. The main objective of the reconfiguration is to ensure a clear provincial institutional accountability, in order to address the confusion caused by having multiple Water Boards serving the same areas. The proposed reconfiguration is intended to have the following impact: • Rand Wa ters’ infrastructure, assets and contracts in the North West Province should be transferred to Magalies Water. • Magalies Wate rs’ infrastructure, assets and contracts in the Gauteng Province should be transferred to Rand Water. The entity notes that the reconfiguration does not impact the requirement for Rand Water to continue servicing the Mpumalanga and Metsimaholo Municipality as well as the Ngwathe Municipality in the Free State Province. Rand Water Services (Pty) Ltd Following the appointment of Rand Water as an Implementing Agent of the Emfuleni Local Municipality (ELM) WSA Section 63 Intervention by the Minister, Rand Water and Emfuleni Local Municipality (ELM) agreed to corporatise water services in ELM. Rand Water Management recommended to the board to resuscitate Rand Water Services (Pty) Ltd, a subsidiary of Rand Water, in order to ringfence the activities of this intervention. The Board of Rand Water approved the resuscitation of the subsidiary pending the fulfilment of all legislative and regulatory requirements and governance structures being put in place. In August 2023, Emfuleni Local Municipal Council passed a resolution to partner with Rand Water Services (RWS) in a new entity to be jointly owned by RWS and ELM to manage water services in ELM. Post the council resolution, Rand Water and ELM are undertaking a due diligence exercise in order to finalise the modalities of this venture which is expected to be completed by the end of June 2024. Commissioned Station 5A Filtration Plant On 31 August 2023, the Chief Executive Officer of Rand Water Mister Sipho Mosai with the Chairperson of the Board Mister Ramateu Monyokolo accompanied by the Minister Senzo Mnchunu and Deputy Minister David Mahlobo of the Department of Water and Sanitation, commissioned the completed phase 1 of flagship projects, a 150 Megalitre a day (ml/d) Station 5A filtration plant. The infrastructure brings assurance to sustainability of water supply to the Gauteng Province and surroundings. 13. Corporate business plan and shareholders compact For 120 years, Rand Water has supplied bulk potable water to Gauteng and its surrounding areas. Rand Water’s success is based on sharing the pioneering spirit that led to the growth of the City of Johannesburg. It is the same spirit that has driven Rand Water’s growth in terms of infrastructure and quality. Rand Water has an internationally renowned reputation for supplying water of a quality that ranks amongst the best in the world. By the early 1970s, Rand Water’s primary source of water, the Vaal River, had reached available abstraction capacity. The problems of future water supply for industries, commerce and domestic use in the Gauteng area were becoming increasingly serious. The solution was to transfer water from the catchment area of the Tugela River to that of the Vaal. Since the water transfer over the Drakensberg required the construction of reservoirs, tunnels, and pumps, it opened the way to build a hydroelectric power station which could further exploit the potential of water resources being made available. In 1982 the project was completed, The due diligence exercise pertaining to the feasibility of the reconfiguration has been concluded which will inform the decision on the proposed reconfiguration. The Board is not aware of any other matter that has risen since the end of the financial year.

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