- City Power
- Johannesburg Water
- Pikitup
10.33 City Power
i. Functions/outlook
City Power presented a draft Business Plan dealing with, among others, the following issues:
- Finance (financial projections, its forecasts and its revenue model, including some market analysis, with key investment attractions being outlined)
- Human resources (HR issues for the Company)
- Service delivery issues (Services to be provided by City Power; activity flow charts such as billing, credit control, service connections and collections; and issues around service partnership)
- Operations (Operational flow for the revenue management and operational activities)
- Social obligations
- Key performance indicators (need to develop a performance management strategy and an implementation plan, which needs to be, phased in from 2001 to 2005).
ii. Problem statements
- Some households not serviced
- Low usage in certain areas
- Perceptions of high tariffs
iii. Outcome
Social, economic and environmentally sustainable development in the City through affordable, accessible, reliable and safe electrical power.
iv. Strategies
- Extension of electrification into areas that are not serviced and into new areas that are not serviced
- Promote customer service and satisfaction
- Ensure continuous reliability of supply
- Upgrade overloaded and ageing networks to reduce power interruptions, through the implementation of a ten-year capital investment programme
- Promote job creation, partnerships and strategic alliances with black empowerment companies
v. Outputs and targets
| Outputs | Targets |
Financial model including:
| December 2001 |
| Debtors audit | December 2001 |
| Assessment of the non-technical losses | December 2001 |
| Asset valuation, load forecast and tariff projections | December 2001 |
| Tariff proposal to the National Electricity Regulator (NER) | December 2001 |
| Organisational structure, policies and procedures and staffing requirements | December 2001 |
| Reports to the NER on compliance with NRS 047 and 048 | December 2001 |
| Operational and management plan,Including maintenance, operation and construction activities and action plans | December 2001 |
| Risk assessment of consolidating the Unicity system and data migration | December 2001 |
| Performance management strategy and implementation plan | December 2001 |
| Electricity services development plan | June 2002 |
| Staff training and development plan | December 2001 |
| Low income service plan | June 2002 |
| Occupational health and safety programme | June 2002 |
| Standard operating procedures and manuals | June 2002 |
| Customer service plan | June 2002 |
| Public education plan | June 2002 |
| Environmental programme | June 2002 |
| Increased revenue | June 2002 |
10.34 Johannesburg Water
i. Function/outlook
Johannesburg Water (JW) is the newly formed utility company mandated to provide water and sanitation services to the residents of Johannesburg. JW has taken over the assets from council necessary to undertake this. Over 2500 employees of the city have transferred to JW. JW purchases water in bulk from Rand Water, and then reticulates it to the residents and businesses of Johannesburg through a network of over 8000 km of distribution pipes and over 100 reservoirs and water towers.
Further, JW collects all waste-water through a network of sewers, and treats this at one of six treatment plants before discharging back into the river system. JW does not undertake the commercial function of metering, billing and collection. This is executed by the Finance Department (Revenue). JW will be assuming control of these functions for water services over a period of time - probably a two-year period.
JW has entered into a management contract with an operating consortium - JOWAM (comprising Ondeo Services, France - part of the Suez group, and its subsidiaries Northumbrian Water Group, UK, and WSSA - RSA). Under this contract a team of twelve people initially - reducing to two over time - will provide expertise in critical areas whilst the capacity of the utility is being developed. JOWAM assume some of the operational risk under this performance based contract and in practice fill various executive management functions within JW for periods ranging from 18 months to 5 years. An independent Board of Directors appointed by the city in its capacity as the sole shareholder governs JW.
ii. Problem statements
The major problems facing JW are:
- Capacity within the organisation to address the challenges
- Lack of data to allow for effective management and monitoring. Measurement is lacking in all respects
- Unaccounted for water (UFW) is too high. UFW measures the amount of water purchased - from Rand Water - and not resold by JW. At this stage this is estimated at over 40%, made up of physical system losses as well as commercial losses. Commercial losses include under-billings on deemed consumption customers, non-billings, meter calibration errors, and theft
- High level of non-payment
- Unacceptable level of environmental non-compliance
- Poor customer interface and customer relationship management
- Inadequacy of delivery in certain informal areas
iii. Outcome
Affordable access to clean running water and hygienic sanitation for all to improve quality of life.
iv. Strategies
Key strategies include:
- Capacity building within organisation through training, restructuring and focus, and targeted recruitment
- Targeted and increasing investment progamme in rehabilitation and asset replacement and network expansion
- Metering all formal areas
- Introduction of free essential water programme from 1July 2001
- Assume responsibility for full customer management
- Use procurement to promote empowerment and labour intensive construction
v. Outputs and targets
| Outputs | Targets |
| Unaccounted for water | Reduction from 43% to 24% over five years |
| Operations | Reduction in environmental spillages on a per annum basis. Initially the measurement system has to be developed. Restructuring all operations to achieve focus Improved monitoring of water quality Plant utilization improvement - initially to set in place a measurement system, then to agree targets. Most important is the sludge handling facilities |
| Customer services | To establish an interim call centre for non account complaints by July 2001 To develop the capacity to take over the 10000 top customers by October 2001 To develop the plan to take over the remaining customers by December 2001 To take over and re-bid the meter reading contracts become accountable to JW by November 2001 |
| Human Resources | To restructure the entire organisation by September 2001 To regrade the new structure by December 2001 To address the parity problems by December 2001 To develop a number of policy reports from July 2001 To comply with the requirements of the Equity Act, Skills Development Act, etc |
| Capex and Development Planning | To provide an efficient service to developers and planners To deliver the capital programme efficiently and timeously. The total programme for 2001/2001 is over R180m |
| Social Programme | To commence the delivery of essential free water from July 2001 To utilise the farms to provide opportunities for eco-tourism and social upliftment |
| Customer charter | June 2002 |
| Contingency management plan | June 2002 |
| Procurement policy | August 2001 |
| Base year data report | February 2002 |
| Operations and maintenance plan | February 2002 |
| Management information plan | December 2001 |
| GIS evaluation report & plan | December 2001 |
| Procurement guidelines | August 2001 |
| Strategic business plan | January 2002 |
10.35 Pikitup
i. Function/outlook
The vision of Pikitup is to make the City of Johannesburg the cleanest city in the world. Its key performance areas are geared towards achieving this vision and are centred around, among others, service delivery, which will include for example, the extension of the 240-litre wheeled bin system to all formal residential and business areas, the establishment of a Service Desk, clean-up campaigns, etc. Pikitup has set as one of its priorities in relation to social obligations, the improvement of the cleanliness of the Inner City and high-density housing areas, and the extension of effective services into the informal areas. One of the Company's approaches to social responsibility is job creation. The Company proposes, among others, the establishment of more recycling initiatives, with the involvement of local entrepreneurs; the establishment of buy-back centres, a composting Joint Venture arrangement with a Black Economic Empowerment Company. Pikitup also wishes to introduce mobile "ride-on-vacuum cleaners" for street cleaning and to develop this into an empowerment franchise scheme - the concept is currently being developed.
Pikitup currently employs 4 245 employees, 2 771 of whom are permanent staff and 1474 of whom are contract employees.
ii. Problem statements
- Competition from private sector operators for commercial waste services
- The permanent workforce is relatively old for the physical work
- Some households and firms not serviced
- Recycling not entrenched in society and operations
- Ineffective fleet management
- Usability of garden sites
- Ineffective street and open/public space cleaning
- High levels of illegal dumping
iii. Outcome
A city which is clean and environmentally responsible offering a healthy life
iv. Strategies
- Provision of waste collection services in unserviced areas
- Minimisation of levels of waste for disposal
- Introduction and promotion of recycling programmes
- Maintain present coverage of waste removal and extension of services into unserviced areas
- Encourage resource recovery through a formalised system
- Contribute towards a clean and healthy environment
- Promote community participation, awareness and education
- Promote job creation, partnerships and strategic alliances with black empowerment companies
v. Outputs and targets
| Outputs | Targets |
| Complete migration and capacitate organisational structure | Complete by September 2001 |
| Establish a head office | September 2001 |
| Call centre | Recruit and train 8 staff members by August 2001 Complaints response time - 48 hours |
| Effective waste removal operations | Establish fleet needs by March 2002 75% fleet availability by October 2001 Operations performance monitoring system by June 2002Collection vehicles collect according to pre-arranged daily schedules - conform to schedules 90% Reaction time to emergency clean-ups - 90 minutes Monitoring of streets (litter free) and litter bins emptied and quarterly report - commence August 2001 |
| Effective disposal | Establish Northern Works landfill site by December 2002 Obtain landfill permits by December 2001 Identify new incineration technology by July 2001 Set-up plant workshop by April 2002 Increase medical waste market share by 10% by December 2001 Public survey to reflect satisfaction with management of garden and waste collection sites by February 2002 Waste minimisation and recycling strategy by September 2001 |
| Parity plan | December 2001 |
| An effective fleet | Ensure full and optimal capacitation of fleet by December 2001 Fleet management and monitoring system by December 2001 Driver skills analysis, legal compliance and training schedule by February 2002 "Driver of the Year", competition by February 2002 Retain R500 000 from Superfleet risk fund by December 2001 |
| Full control of commercial customers | Take over management by December 2001 Confirm commercial customer base by December 2001 Grow commercial customer base by 5% by December 2002 |
| Effective management support systems | Complete business modelling by September 2001 Operational/resource distribution model by March 2002 Contract management system by May 2002 Waste simulation model by March 2002 All depots connected to existing systems by April 2001 |
| New business development | Establish a joint venture for street cleaning by June 2002 2 new buy-back/recycling centres by June 2002 Establish a CRM centre by February 2002 Brand development strategy by December 2001 Implement various "brand" building initiatives - ongoing Community education plan by July 2001 |
| Pikitup strategy workshop | Six monthly/annual |
| Five year plan | 1st draft by May 2001 |
| Black empowerment initiatives | Programme development by October 2001 |