New state-owned company coming for South Africa this year

South Africa is facing a worsening water crisis, with many areas experiencing water shortages and declining water quality.
In hopes of tackling this, the government is establishing a new state-owned enterprise for water, which the Minister of Water and Sanitation Pemmy Majodina expects to be complete by May 2025.
“Load shedding has been supplanted by the crisis of water security, which poses a similar if not greater threat to the quality of life and economic prospects of all South Africans,” President Cyril Ramaphosa said at the start of 2025.
Back in March 2024, Parliament passed the National Water Resources Infrastructure SOC (state-owned company) Bill, and was then assented in August.
Broadly, the bill creates the South African National Water Resources Infrastructure Agency (NWRIA) as a significant public entity and state-owned company.
This agency is expected to begin operations in the first half of 2025.
Both the President and the Minister of Water and Sanitation have said that the current system, characterised by fragmented responsibilities between different entities, has proven ineffective in attracting the necessary investment to address the crisis.
Ramaphosa said that the new legislation is part of reforms in the water sector aimed at attracting private investment, enforcing accountability, and remedying a crisis that has caused outages and poor water quality nationwide.

What will the NWRIA do?
According to the Act, the NWRIA’s main mandates is to streamline water resource management by consolidating responsibilities under one body, enabling more efficient planning, implementation, and funding of crucial water infrastructure projects.
Key goals of the NWRIA include:
- Ensuring a sustainable and equitable water supply for all South Africans.
- Increasing investment in water infrastructure.
- Improving water quality.
- Addressing the fragmentation in water resource management.
- Attracting private investment.
- Generating revenue from water sales.
One of the NWRIA’s primary functions will be to implement water resource management infrastructure projects identified by the Department of Water and Sanitation (DWS).
The agency will also be responsible for collecting water use charges, providing a steady income stream to fund its operations and infrastructure development.
To further bolster its financial standing, the NWRIA will acquire the commercial enterprise of the Trans-Caledon Tunnel Authority (TCTA), including all its assets, rights, and obligations.
This will provide the NWRIA with a substantial asset base to leverage for funding.
Legal experts at Webber Wentzel, Calvin Nchabeleng and Makgati Makgatho said that “the Bill creates an opportunity for the national government to address issues relating to water security outside of South Africa’s constrained fiscal environment.”
The TCTA, currently a state-owned entity, finances and implements bulk raw water infrastructure projects but lacks a substantial asset base to leverage the funding required for these projects.
Nchabeleng and Makgatho said that transferring its assets to the NWRIA is expected to create a more financially stable entity capable of attracting both commercial and development finance.
The establishment of the NWRIA is being lauded by some experts as a positive step towards tackling the water crisis.
Nchabeleng and Makgatho highlight that by operating outside the limitations of the national budget, the NWRIA will have increased flexibility to pursue innovative funding solutions and attract much-needed investment to upgrade and expand South Africa’s water infrastructure.
Visiting Professor at the Wits School of Governance, Mike Muller, previously wrote that this new arrangement could ensure that the funds needed are properly applied.
“This will avert the kind of problems that resulted when billions of rands meant for operation, maintenance and loan repayments were irregularly diverted by a previous Minister of Water and Sanitation for a spurious ‘War on Leaks’ project that never fixed a single leak,” said Muller.

Is it all smooth sailing?
Dr. Ferrial Adam, executive manager of water rights advocacy group WaterCAN, previously expressed concern over the addition of another state-owned enterprise given the performance of existing ones.
“The one confusing thing for me is I believe one of the other objectives is to ensure sustainable and equitable supply – but isn’t that already an objective of the department?” said Adam.
She emphasises the need for transparency and accountability, as “SOEs can feed corruption if not done properly.”
The establishment of the agency requires substantial funding, prompting the call to the private sector.
Adam thus stressed that the funding model must be clarified and raised concerns about whether this partnership signals a move towards privatisation, which globally may not always be the best option for accessibility and affordability.
With that said, experts say that the NWRIA’s success hinges on several factors:
- The appointment of a competent and independent board of directors: The board will be responsible for providing strategic direction, ensuring good governance, and holding the agency accountable.
- Effective community engagement: This includes consulting with affected communities to address their concerns and ensure projects are implemented in a socially and environmentally responsible manner.
- Addressing historical issues of mismanagement and corruption within the water sector: The NWRIA needs to establish transparent and accountable processes to build public trust and ensure the efficient use of resources.
Otherwise, they warn that it could serve as just another feeding trough of corruption seen in other SOEs.
Read: Debt skyrockets in South Africa – with nothing to show for it