Transcript WUA Billing Agents Policy

BILLING AGENT POLICY
POLICY ON WUAs ACTING AS
BILLING AGENTS
PREAMBLE [1]
o Policy sets out the process by which
WUAs & IBs can undertake billing of
water use charges on behalf of DWAF
o This function can be performed in
terms of Section 58(1) of the NWA
o The specific arrangements between
the WUAs/IB that undertakes the
billing agent function will be
formalized by contract
o The policy will be implemented on a
voluntary basis.
APPLICATION OF THE POLICY [2]
Sec 58 of the NWA empowers the Minister to direct any
Water Management Institutions to act as billing agent.
This also include Irrigation Boards (IB), however this
will be a transitional arrangement for IB as they will
have to transform into a WUA to continue acting as
billing agent.
All collecting agents will be referred to as
Billing Agents (BA) in this presentation.
RELATIONSHIP BETWEEN BA AND DWAF [3]
Each prospective BA will enter into a contract with
DWAF prior to assuming billing function, the
contract will specify:
o Time frames and provision that are specific to the
circumstances of the BA.
o The duration of the contract will not exceed 3 years
and is renewable by agreement
o Delegation in terms of section 63 of the NWA will
occur only in respect of suspension and restrictions
of water use (section 59(3) of the NWA)
o If all remedies available to the BA have failed, the
BA may approach DWAF through their regional directors
for assistance in instituting civil action against
defaulters, at the Departments expense.
CHARGES TO BE COLLECTED [4]
As per the Pricing Strategy there are four types of charges that are to be
collected:
o
o
o
o
Water Resources Management Charges (WRM) – This charge is payable by
all users taking water from the countries water resources for
irrigation, mining, industrial, municipal use and for commercial
afforestation. The charge is also applicable to waste discharge
related water management activity.
Water research levy – This is charges in terms of the Water Research
Act and payable to the Water Research Commission (WRC). The charge is
applicable to users receiving water from government water schemes
including water services providers like municipalities, water boards
and WUA/IB.
TCTA (Trans-Caledon Tunnel Authority) charge – This charge is
currently applicable to water users dependent on water from the Vaal
River and Berg River systems and is based on actual measured use.
This charge in future will be charged by the proposed infrastructure
agency.
Wastes Discharge Charge System (WDCS) – This is the yet to be
implemented charge which provides for the management of water quality.
This charge is broken down into an incentive and mitigation charge.
CONDITION TO UNDERTAKE BILLING
FUNCTION [5]
All billing agents will be required to:
o
o
o
o
Develop systems and procedures for the issuing of bills and recording
of transaction
Keep proper accounting records in line with GAAP (Generally Accepted
Account Practice)
Keep proper records of all debtors in accordance to GAAP
DWAF to be given access of individual debtors record upon request
WUA that do not have effective systems to run a billing agent may approach
DWAF for support, such application will be considered upon merit
The quality of debtors records should be of a sufficient standard to enable
such information to be used as acceptable evidence in a Court of Law
DWAF reserves the right to make random checks on WUA debtors records
DWAF reserves the right to immediately terminate the BA agreement if the BA
does not keep proper accounting and debtors records or is ineffective in
collecting water use charges.
CONFIRMATION OF REGISTERED USE [6]
To confirm registered members of a BA
• DWAF will send out a list of confirmed members to
each BA, prior to or together with the invoice
• The BA must affirm in writing that the list is correct
• Should the BA not agree with the list then it must
provide a reconciliation statement pointing out variance
to DWAFs records
• If DWAFs list is found to be less that the BAs list then
DWAF must register the additional volumes
• If DWAFs list is greater than the BAs, then the BA will
charge in accordance to DWAFs list and will take
measures to updates its records and charge all
relevant users
• The BA must keep records of changes to membership
and changes in contact details as well as changes in
volumes registered to each member
STEPS IN THE BILLING PROCESS [7]
o
o
o
o
o
o
o
o
DWAF will issue a consolidated invoice to the BA
BA will issue individual invoices to each member/user
BA receives and record payment
44 days after DWAF issued invoice, BA must pay the full amount recovered
from members to DWAF
In cases of short payment the BA will pursue all possible avenues to
recover amounts due by defaulting water users including Section 59(3)
processes (stopping or restricting water supply) to those water users
whose account is in arrears for more than six months.
The BA will provide DWAF with a monthly reconciliation of debts in arrears
and will also provide a written progress report on the status of each
outstanding debt in excess of R5000 which is in arrears for 90 days and
longer
After the BA has forwarded the full amount received as per the
consolidated invoice, DWAF will credit the BA’s account for the
commission due 30 days after receiving payment with the consolidated
invoice
The BA agreement will include a detailed list of historical arrears of
each client including the age of each debt for once off commission on
arrears.
COMMISSION PAYABLE
%AGE COLLECTED
COMMISSION
Up to 70%
5%
71% - 90%
6%
91% - 100%
7%
ONCE OFF ARREARS
Between 60 and 180 days
8%
Between 181 to 360 days
9%
In excess of 360 days
10%
BILLING AGENT
o With regards to collection of arrears
the commission is a once off payment
registered at the time of signing the
BA Agreement
o If a debt at the time of signing the
agreement is 60 days in arrears and
money is only collected after 360
days, then the commission payable
will be 8% and not 10%.
o The policy does not apply
retrospectively and therefore no
compensation will be payable for past
collections.
THANK YOU