Unpacking the National Water Act
Who owns the water flowing through (or under) your estate?25th Apr 2020
The National Water Act of 1998 (NWA), which was the first comprehensive legislation adopted immediately after the transition to democracy, has far-reaching implications of which most people are blissfully unaware.
Instrument of redistribution
When we became a democracy in 1994, we were all collectively relieved that a civil war had been averted. We were so focused on the fruits of this relatively peaceful transition that few ever paid attention to the first piece of comprehensive legislation that was passed in 1998. So let’s contextualise this to better understand it, because the NWA is intended to be an instrument of restorative justice.
The man driving the water reform was Kader Asmal, a highly respected scholar who had spent his political exile lecturing in law at Dublin’s Trinity College. An articulate man, he brought a bold vision to this reform process. Working with him at the time, I got some insights into his thinking, which eventually translated into law.
The burning question at the time was about how to redistribute land to achieve historic redress from the inter-generational dispossession created by the Native Land Act in 1913. That act was the first major law passed by the Union Government, and it laid the foundation for the Bantustan system that eventually forced the majority of the population to live on 13% of the land.
There were two main implications arising from this law. The first was the linkage of water rights to land ownership rights. In effect, all land over 87% of the surface area of the country became white owned, but so too did all water rights associated with that land. This applied to rivers flowing through the land, or water in aquifers beneath the land. This was known by the Latin term dominus fluminis, and it implied absolute ownership vested in a legally defended right to water. The Roman-Dutch law was based on a legal theory by the Dutch philosopher Hugo de Groot, which stated that property rights arising from just acquisition are legitimate and defensible. This was used to justify the foundational apartheid legislation, because it created a basis for defending rights associated with land taken by force.
The second was the creation of the South African Native National Congress (SANNC) in January 1912, driven by the passage of the Native Land Act through parliament at that time. The SANNC was the progenitor of the ANC that took power in 1994, with Kader Asmal as its duly appointed Minister of Water Affairs. Dealing with de Groot’s legal philosophy was thus a pivotal issue, because the ANC argued that land taken by force couldn’t ever have justiciable rights associated with it. Most laypeople are unaware of this core feature of the NWA.
Land rights and water rights are a burning issue
Land rights are therefore at the very heart of South African political dynamics, and they came to the fore during the negotiations that ended our festering conflict in 1994. Part of the deliberations at CODESA, the negotiating forum that created our democratic constitution enacted in 1996, dealt with the issue of land expropriation. Enshrined in the new constitution was the core principle that no land may be expropriated without compensation at free market value. This frustrated the ambitions of the ANC negotiating elite, but it was a reality that had to be dealt with. The great fear at that time was the Zimbabwe land grab, which had plunged the country into an economic crisis by collapsing the financial system. After all, land was used as collateral for loans from banks, so when it was merely seized, banks lost their collateral and were unable to function.
The idea therefore came to light that the process of land transfer could be managed without the catastrophic consequences that were becoming manifest in Zimbabwe at that time by contesting de Groot’s philosophical principle, and rather managing access to water.
Water gives land its value
Water is what gives land its value, so the separation of water rights from land ownership rights gave the ANC government a powerful lever with which to control the asset base of what was perceived to be the wealthier minority. The NWA therefore nationalised water, and placed ownership in the hands of the state. This meant that the ANC now controlled a major asset class that had, until then, constituted wealth for the ethnic white minority.
This had far-reaching implications because, in an instant, it meant that all water users had to have permits for that use. This created an administrative burden that the state has never managed to deal with effectively.
The red tape
Prior to 1998, individuals, businesses, farmers, mines and estates had an inalienable right to use the water running through or under their land. But the gist of the NWA is that all water users and potential water users must apply for permission to use water, so, at the stroke of a pen, this right became subject to a permit. At the time, it was pretty much a formality, so landowners who applied in 1998 were almost invariably granted permission.
However, water authorisations are valid only for a defined term, and must be renewed every five years without any guarantee that the same allocation will be given in the future. This has translated into significant risk for bulk users, and is one of the reasons that some foreign direct investment has been withheld from South Africa, as investors would be loath to put money into an enterprise if there is a chance that water might not be available in a few years’ time.
But what about domestic water use?
It would be a logistical nightmare to authorise every domestic water user, so government issues general authorisations for domestic use to municipalities, which serve as bulk water suppliers. So the public – and even many estate managers – remain blissfully unaware that they do not have a permanent, inalienable right to water on their land, even if they decide to drill a borehole during a drought.
So what does that mean in practice?
All water use must be authorised. When seeking authorisation, users or potential users must motivate why they need the water, and must support their application with a raft of technical documents that may cost hundreds of thousands of rand to produce. It is unlikely that a developer would be denied permission for domestic purposes, but using groundwater for the irrigation of sports fields or golf courses, or for water sports, may be regarded somewhat less favourably. The take-home message is that water may never be owned as a right in South Africa.
This may come as a surprise because, despite the regulations, the state has – at least until now – not had the capacity to fully implement the NWA. So farmers, developers, estates, and even individual citizens have been using groundwater and/or riparian water with impunity – but, technically, illegally. (Just because you’ve got away with it, doesn’t mean it’s legal.)
Of course, business plans should be based on guaranteed access to resources, and compliance with all relevant regulations, so developers and/or HOAs must take cognisance of the fact that, while there might be a borehole on the estate, it may not be strictly legal to use it. And, even if it is, there is no guarantee that this will continue to be the case. So probably the only way to create unassailable water security is rainwater harvesting. Once rainwater becomes part of the groundwater it belongs to the state, but, if you catch it before it enters the ground, you can keep it – at least until the state decides that this is a streamflow reduction activity that falls foul of Section 21c, or decides to attach conditions to the storage of that water in terms of Section 29/1/e/vii.
At present, the state lacks the capacity to effectively implement the NWA, but bear in mind that they do have full authority to prosecute illegal use of water from a river or from a borehole, and can prevent future exploitation of the resource. For example, the state is empowered to seal a borehole that is being used without authorisation by pouring concrete down the shaft. To my knowledge this has never been done in South Africa, but it is legally and logistically possible.
This opens a range of legal issues for trustees, directors and managing agents of existing estates that are using boreholes and/or river water, and for developers who are planning to exploit riparian or groundwater in their developments.