Bloem Water has warned of a collapse by July or August 2020 as it will have no financial resources to continue with its operations.
Three municipalities, including the Mangaung Metro, Kopanong and Mantsopa Municipalities, owe Bloem Water over R1.4 billion and have allegedly defaulted on payments for close to a year, and in some instances several years.
The water institution has also blamed the national lockdown requirements to its exacerbated financial crisis. This means Bloem Water could soon run out of money to maintain its service delivery as cash reserves at the entity are said to be quickly being depleted as they are utilised for operational and maintenance requirements.
These maintenance requirements include refurbishments, capital projects and loan repayments. "Bloem Water continues engaging stakeholders as to resolve the current status, to no avail," the institution adds. The institution had previously locked horns in court battles with the embattled Mangaung Metro over debt in arrears.
In July 2019, the embattled metro, which includes Bloemfontein, Dewetsdorp, Botshabelo and Wepener, filed for a High Court interdict against the water institution after it cut water supply to 30% for thousands of residents as a result of R449 million that was in arrears at the time.
“We continue engaging stakeholders to resolve the current status, to no avail. There have been numerous previous submissions to related authorities, mainly related to the non-payment of accounts and restrictions of water supply to the municipalities,” Bloem Water says in a statement.