For the first time, the Auditor-General has audited the entire water value chain, from the national department to the municipal tap. The picture it presented to Parliament this week is of a system failing at almost every link.
On Tuesday 2 December 2025, the Auditor-General of South Africa briefed Parliament’s Portfolio Committee on Water and Sanitation on its 2023/24 Water Sector Report. It is the first time the auditors have brought together the audits of the Department of Water and Sanitation, its trading entity, the water boards and 135 municipal water services authorities into a single consolidated view of how water is managed in the country. Until now, the national department, the bulk utilities and the municipalities were judged in separate reports. Seen together, the findings explain why so many South Africans experience the water crisis as one continuous failure, from the dam to the drain.
Unsafe water at the tap
The most alarming numbers concern drinking water. According to the auditors, 46 percent of drinking water systems failed microbiological safety standards during the period audited, and 44 percent failed chemical safety tests. Microbiological failures point to bacteria such as E. coli surviving treatment or entering the network afterwards, while chemical failures can reflect poorly dosed treatment, contaminated sources or ageing infrastructure.
These results do not mean that nearly half of all South Africans drank unsafe water every day of the year. Audits test systems against standards over a period, and large metropolitan systems generally perform better than small rural ones. But they do mean that in a very large share of the country’s water supply systems, the safeguards that are supposed to guarantee safe water were not working consistently.
Sewage works in near-total failure
If drinking water is the visible end of the system, wastewater is the hidden one, and the audit found it in an even worse state. The auditors reported that 99 percent of the wastewater treatment works they assessed failed at least one effluent quality standard, and described the environmental consequences as near catastrophic. Untreated and partially treated sewage released from these works ends up in rivers and dams, where it harms ecosystems and makes the next town’s drinking water harder and more expensive to treat.
The auditors raised 76 material irregularities at municipalities linked to environmental pollution or the failure to safeguard assets. A material irregularity is a formal finding that non-compliance or fraud has caused, or is likely to cause, a financial loss, harm to a public institution or substantial harm to the public, and it obliges the accounting officer to act. For readers who follow rivers such as the Vaal, the Hennops or the Apies, these findings are a formal confirmation of what citizen monitors have been reporting for years.
Where the money goes
The audit is equally damning about money. Municipal water services authorities reported water losses worth R14.89 billion in 2023/24, and 56 percent of them lost more than 30 percent of their water, the norm against which losses are measured. That money represents water that was bought or treated and then lost to leaks, burst pipes, illegal connections, faulty meters or unpaid bills.
The auditors also found that municipalities spent about R2.32 billion on water tankers in a single year, with roughly R420 million of that classified as irregular expenditure. Tankers are an emergency measure, but in many places they have become a permanent part of the water supply because networks are not maintained well enough to deliver water reliably. The AGSA’s Jolene Pillay told the committee that a large number of water services authorities now depend on tankers.
That dependence flows directly from neglected maintenance. On average, water services authorities spent only 3 percent of the value of their infrastructure on repairs and maintenance, against a benchmark of 8 percent. Almost all of them, 96 percent, failed to meet maintenance norms, and 30 authorities, nine of them in the Northern Cape, had no maintenance plan for their water infrastructure at all. A quarter of municipalities had no water services development plan, the basic planning document required by law. The national department itself carried out only 39 percent of the planned maintenance on its own assets, such as dams, canals and pump stations.
Infrastructure projects fared no better. The auditors found problems in 82 percent of the water infrastructure projects they examined, and more than half of them were running late, many by years rather than months.
Losses, irregularities and the bigger players
Across the sector, material irregularities now exceed R1.7 billion in estimated losses. At the Department of Water and Sanitation and its Water Trading Entity, the auditors identified estimated losses of about R443.6 million, including cases linked to emergency repairs at the Vaal Dam and standing-time costs at Hazelmere Dam in KwaZulu-Natal. Only about R57 million of that is being recovered. At Umngeni-uThukela Water, the bulk utility serving much of KwaZulu-Natal, estimated losses of about R145 million were identified. Committee members also heard of a contract at the utility for work worth under R90 million that reportedly received R390 million while remaining incomplete, which the minister has since ordered to be investigated.
None of the national water entities or the seven water boards achieved a clean audit. Among the 135 municipal water services authorities, only 23, or 17 percent, received clean audits, while 64 were qualified, four received adverse opinions and seven received disclaimers, meaning the auditors could not form an opinion at all. More than four in five had material findings on compliance with the law.
The department’s own financial management was also questioned. Committee documents showed that it had spent 46.3 percent of its adjusted budget of about R26.7 billion by the middle of the financial year, and that cumulative irregular, fruitless, wasteful and unauthorised expenditure stood at about R5.7 billion. The auditors also noted that only two catchment management agencies, the bodies meant to manage water resources at river basin level, were fully operational during the audit period.
Parliament reacts
Members of the committee from across the political spectrum were united in their alarm. Visvin Reddy of the MK Party summed up the mood by saying that “money is flowing, but services are not”. The committee chairperson, Leon Basson of the Democratic Alliance, described the state of the sector as unacceptable. Members proposed more intensive oversight visits to municipalities, joint sessions with water boards and municipalities, quarterly reporting on material irregularities, and in some cases criminal charges for pollution. Some suggested a commission of inquiry into failing water services authorities.
When the DA’s Stephen Moore asked the auditors where accountability was weakest, they pointed to the water services authorities themselves, where action plans to fix audit findings were frequently poor or missing altogether.
Why this report matters
The consolidated audit is important precisely because it removes the excuse that each part of the system can blame another. Municipalities often point to bulk suppliers and national funding; national government points to municipal mismanagement; water boards point to unpaid municipal debts. By auditing the whole chain at once, the Auditor-General has shown that failures in planning, maintenance, financial control and consequence management run through every level.
It also gives Parliament, civil society and residents a factual baseline. The Water Services Amendment Bill, tabled in October, proposes separating the role of water services authorities from that of water service providers and introducing licensing for providers. The audit provides the evidence base for why such reforms are being proposed, and a benchmark against which their impact can be measured. The next test is whether the material irregularities lead to real recoveries and consequences, and whether the maintenance gap between 3 and 8 percent starts to close. Without that, the rivers, the reservoirs and the people who rely on them will continue to pay the price.
References
Parliamentary Monitoring Group: Water Sector Report, AGSA briefing (2 December 2025): https://pmg.org.za/committee-meeting/42181/
Parliament of South Africa: Committee on Water and Sanitation expresses deep concern over AGSA water sector audit report findings (2 December 2025): https://www.parliament.gov.za/press-releases/media-statement-committee-water-and-sanitation-expresses-deep-concern-over-agsa-water-sector-audit-report-finding
Business Report: A-G flags R2.3bn drain by water tankers as maintenance collapses across municipalities (2 December 2025): https://iol.co.za/business-report/companies/2025-12-02-a-g-flags-r23bn-drain-by-water-tankers-as-maintenance-collapses-across-municipalities/
Engineering News: AGSA report lays bare a water sector in systemic collapse: https://www.engineeringnews.co.za/article/agsa-water-report-unveils-water-sector-deterioration-2026-01-23
Acts Online: Water Services Amendment Bill tabled in Parliament (October 2025): https://acts.co.za/news/blog/2025/10/water-services-amendment-bill-2025
Parliamentary Monitoring Group: Water Services Amendment Bill (B24-2025): https://pmg.org.za/bill/1301/