Notice No. 1098 of 2019

23 August 2019

GG 42657

National Treasury

I, TITO MBOWENI, MINISTER OF FINANCE, acting in terms of Section 66(3)(b) of the Public Finance Management Act, 1999 (Act No 1 of 1999), hereby authorise the accounting authority of Rand Water to borrow money and issue bank guarantees up to the limits as stipulated below:

The proposed limits on borrowings reflect the maximum balance of interest-bearing debt at any point in time for the relevant period and takes into account Rand Water's existing outstanding interest-bearing debt. This means that for as long as Rand Water has interest-bearing debt on its statement of financial position (or balance sheet), it will need to adhere to the limits above. The proposed authorisation is set to expire on 30 June 2021 and a new authorisation will have to be considered upon expiry, provided Rand Water has borrowings recorded in its statement of financial position.

The bank guarantee amount above reflects the maximum bank guarantee Rand Water may source in favour of Eskom for its Electricity Supply Agreement. Rand Water is required to have a non-cash secured bank guarantee and should at any point in time have liquid investments to the equivalent of R15 million in relation to the financial years highlighted above. The bank guarantee is granted only in favour of Eskom and is limited to Eskom providing electricity to Rand Water's 3 key accounts. These are Zuikerbosch, Zwartkopjes and Palmiet pumping stations. The cumulative amount of the bank guarantee should not in any of the 3 financial years exceed R15 million.

The approval of the authorisation are subject to the following conditions that have to be adhered to by Rand Water:

TT Mboweni, MP

Minister of Finance

Date: 27 June 2019