On 6 August 2025, the cabinet approved the National Water Amendment Act to be tabled at Parliament. This will mark the third amendment to the National Water Act, 1998. The first amendment was in 1999, and the second in 2014.
Across South Africa, the government is keenly aware of the issues facing the water sector and is taking decisive action.
The water sector is a key priority
On 27 and 28 March 2025, the Department of Water and Sanitation (DWS) hosted the 2025 Water and Sanitation Indaba in Midrand, Gauteng.
At the Indaba, DWS adopted specific resolutions aimed at strengthening water security, including:
- DWS to finalise amendments to the National Water Act and submit them to Parliament within six months, including legislating the use-it-or-lose-it principle for water use licences.
- Increase water investment through financing options and ensure the financial viability of the water sector. This includes DWS implementing the revised Raw Water Pricing Strategy and establishing an independent economic water regulator to regulate water prices across the water value chain.
- DWS to finalise the establishment of the National Water Resource Infrastructure Agency by mid-2026 to enable increased finance for national water resource infrastructure projects.
Furthermore, the government included the water sector as a key priority as part of the launch of Phase II of Operation Vulindlela. Work is set to begin in earnest as part of strengthening water security efforts.
Key proposed amendments to the NWA
In line with the above-mentioned resolutions, DWS has proposed amending key legislation that regulates South Africa’s water and sanitation sector. Namely, the National Water Act (NWA) and the Water Services Act, 1997 (WSA).
To this end, the Draft National Water Amendment Bill and the Draft Water Services Amendment Bill were published in November 2023. Below, we highlight the key proposed amendments to the NWA and why they matter for strengthening water security.
If one took a wide-angle lens to the proposed changes to the NWA, they include the following:
- Strengthening the protection of water source areas.
- Regulating the transfer of water use authorisations.
- Provision for reallocation of water by the Minister of Water and Sanitation (the minister).
- Ensuring redress and equality in the issuing of water authorisations and licences.
- Extending the validity of water use licences, whilst a renewal application is still under consideration by a responsible authority.
- Further regulating membership in water use associations.
Strengthening the protection of water source areas
Reliable water flow is crucial for any investment in the water sector. This makes water source areas vital to the reliability of water flow because they are the origin of the water supply.
The Draft NWA Amendment Bill seeks to introduce provisions to review and prohibit the issuance of water use licences where water source areas are threatened. These changes directly support strengthening water security.
A new section in the amendment bill, 20A, requires the minister to publish a notice in the Government Gazette. In the notice, he must scientifically list identified water source areas.
The notice must indicate:
- the geographical location of each water source area, and
- the major threats faced by each water source area.
In addition, Section 20A of the amendment bill requires the minister to publish regulations for the management of activities within and around water source areas that specify the:
- prohibited activities in and around water source areas; and
- restricted activities in and around water source areas.
Consequently, Section 20A of the amendment bill is significant for stakeholders in sectors such as mining, where operations are driven by commodity location.
Powers to amend the list of identified water source areas
Section 20A makes water resource management a precondition for operations. It is also important to note that the amendment bill gives the minister the power to amend the list of identified water source areas – especially where the circumstances that led to their identification have changed.
In other words:
- Sections 20B, 20C and 20D of the amendment bill provide general prohibitions and restrictions in several areas. These include: cast and underground mining that may lead to acid rock drainage or acid mine drainage. Notwithstanding, the amendment bill prohibits issuing a licence for any water use activity relating to open-cast mining or underground mining within the identified water source area.
- Water source areas threatened by or vulnerable to streamflow reduction activities within or adjacent to a water source area, or forestry plantations or incidental activities where a 30-metre setback from the water source area has not been established.
- Streamflow reduction activities in an identified water source area or any forestry plantations or activities incidental thereto.
- Areas threatened by or vulnerable to agriculture, where a 32-metre setback from the water source area has not been established.
Transfer of water use authorisations
The changes in the amendment bill relating to the transfer of water use authorisations are a direct reaction to a 2023 Constitutional Court judgment.
The court found that section 25(2) of the NWA enables a water management authority to permit a holder of a water use authorisation to allow the use of some or all of the water on another property by another person.
In this case, DWS contended that section 25 does not make provision for trading or transferring a water use entitlement from one person to another. DWS submitted that the section only permits a person to surrender part or all of their entitlement. This was to facilitate a water use licence application from the same resource in respect of other land that belongs to that person.
Transfer of a water use authorisation
The Amendment Bill proposes to codify the department’s intention to prohibit the trading or transfer of a water use entitlement from one person to another. It provides that a person holding an entitlement to use water from a water resource may, in full or in part, surrender that entitlement to facilitate their own licence application for the use of water from the same resource in respect of other land belonging to them.
Section 25(1) of the NWA currently allows a person authorised to use water for irrigation to temporarily use some or all of that water for a different purpose, with the approval of the water management institution. That same person can also use some or all of the applicable water on another property in the same vicinity for the same or similar purpose.
The amendment bill permits the transfer of a water use authorisation to land owned by the same person who was granted the original water use. Transfer of water by an authorised person to another person will therefore be prohibited. The amendment bill further limits the open-endedness of the term ‘temporary’ by restricting water transfer to a period not exceeding 24 calendar months.
Prohibitions on water trading
Linked to the transfer of water use authorisations, the amendment bill introduces a prohibition on any trading of water use connected with the surrender of entitlement. The amendment bill provides that such water must be surrendered to the national government unless the minister directs otherwise.
The proposed provision does not provide further detail on how compliance will be monitored or how this prohibition will be enforced. It is assumed that the general provisions in the NWA about offences would apply.
Reallocation of water by the minister
Water reallocation is a water management approach that the DWS wishes to apply to control water supply and demand, thereby strengthening water security. The amendment bill seeks to codify the DWS’s ‘use-it or lose-it’ principle. In summary, any authorised water uses not utilised for a specific period can be reallocated by the minister.
Section 25A of the amendment bill allows the minister to allocate water between water sectors, provinces or catchment areas in the public interest. However, before an allocation can be made, the minister must consult with any affected water sector, provincial or catchment management agency. The minister must inform them of the intention to allocate.
Accordingly, section 25A indirectly addresses the ‘use-it or lose-it’ principle, as any water use surrendered to the national government can be reallocated by the Minister.
Whilst section 25A indirectly deals with the principle, the Amendment Bill expressly codifies the DWS’s ‘use-it or lose-it’ principle through section 34(2A). This section authorises the curtailment of the water volume available due to a user’s failure to exercise the full existing lawful use volume for any period. This amendment provides a mechanism to address the underutilisation of existing lawful water use volumes and to ensure that limited water resources are used efficiently.
Verification of existing water uses
Currently, the ‘use-it or lose-it’ principle is implemented through the verification of existing water uses in section 35. These verifications culminate in determinations which may limit the volume of water a user is legally entitled to.
The principle is also implemented through licences issued following compulsory licence applications in terms of section 43. These licences replace any previous entitlements, including existing lawful water uses.
Redress and equality relating to the issuing of water authorisations and licences
A much-debated proposal in the amendment bill is the granting of water use entitlements while advancing transformation in the water sector. The amendment bill gives the minister the power to make regulations prescribing the criteria that must be considered when redressing the results of past racial and gender discrimination concerning water use.
The draft bill inserts Section 27(3), which prescribes that a responsible authority must “prioritise the redress of past racial and gender discrimination when issuing a licence or general authorisation and set aside a certain volume of water in each water management area to achieve this redress.” This inclusion contributes to strengthening water security through equitable distribution.
Extension of the validity of water use licences
The amendment bill offers relief to both DWS and licence holders during the water use licence renewal process. It provides for a new Section 52(5), which allows DWS, upon receiving a renewal application, to extend the validity period of the relevant licence for a maximum of six months.
Membership of water user associations
Water user associations allow mining companies, commercial farmers and small-scale farmers to meet their own water demands while simultaneously supporting the water needs of local areas. DWS appears to be encouraging transformation in how water use associations are composed.
The amendment bill requires the constitution of water user associations to contain a detailed strategy to achieve transformation concerning racial and gender representation in all components of the relevant association. This is an important requirement to note, as the NWA requires the constitution to be approved by the minister before the establishment of the water user association.
Apportionment of liability for offences
Section 151(1) of the NWA currently lists thirteen offences for non-compliance with the Act. Section 151(2) provides that any person guilty of these offences is liable, on the first conviction, to a fine or imprisonment for up to five years. In the case of a second or subsequent conviction, they are liable to both a fine and imprisonment.
The amendment bill introduces individual liability for directors of business entities and municipal managers.
The draft bill provides for monetary recovery for:
- Loss or damage (to rehabilitate or prevent damage).
- Any advantage gained because of the offence.
- Reasonable costs incurred for the investigation and prosecution of the offence.
With declining water supply assurance, investment in the water sector has become a focus area for the South African government.
In relation to water and sanitation, the National Infrastructure Plan 2050 indicates that to achieve universal and reliable access to water, the vision for water infrastructure entails regulatory oversight and licensing regimes that are robust. These regimes must address both water quantity and quality, as well as pricing, technical performance and the financial sustainability of institutions.
In conclusion
The proposed amendments to the NWA and the WSA aim to implement these strategies. These amendments may provide the government with intervention mechanisms to remedy the apparent failures in the water services sector and to focus on strengthening water security.
Combined with the amendments to Treasury Regulation 16 and Municipal PPP Regulations, and the establishment of the National Water Resources Infrastructure Agency, private sector investment will likely soon enter the water sector. This growing collaboration between the public and private sectors will be essential in strengthening water security for the future.
Calvin Nchabeleng | Partner | mail me | |
Makgati Makgatho | Senior Associate | mail me | |
| | Webber Wentzel | | |
