Analyzing South Africa's Controversial Water Use License Reforms: Equity or Unconstitutionality?

In recent developments within South Africa's legislative landscape, the draft water use license regulations have stirred a significant controversy. Published for public commentary under the National Water Act on May 19, 2023, the regulations propose that certain enterprises applying for licenses to take or store water must allocate between 25% to 75% of their shareholding to black South Africans to be considered for approval.

This move, part of a broader endeavor to address past racial injustices and disparities in resource distribution, has been met with mixed reactions. On one hand, it is seen as a necessary step towards equitable resource distribution and on the other, as a potential threat to the agricultural sector and food security.

The Department of Water and Sanitation emphasized that these requirements would apply solely to applications for new water use licenses and not to renewals. With 98.5% of water resources already allocated, the new stipulations affect only a small fraction of future allocations.

However, these regulations have provoked backlash from various stakeholders, including AgriSA and civil rights group AfriForum, citing concerns that focusing predominantly on ownership could jeopardize existing agricultural operations by potentially redirecting water resources away from established farms toward newly compliant entities.

Legal and policy debates swirl around whether these proposals align with the National Water Act, the Equality Act, and the South African Constitution itself. Critics argue that prioritizing racial quotas above all other considerations might not only destabilize the agricultural sector — a vital component of the nation’s economy — but also contravene principles of equality and non-discrimination enshrined in the Constitution.

Water resources scientist Carin Bosman has criticized the simplistic approach of the draft regulations, suggesting that they use racial quotas as a blunt tool inadequate for addressing the nuanced and complex history of racial and gender discrimination in water allocation. Bosman advocates for a more comprehensive strategy that considers multiple facets of institutional discrimination to genuinely rectify historical injustices.

The debate also surfaces larger questions about the methods and impacts of broad-based black economic empowerment (BEE) policies. While intended to rectify historical imbalances, the efficacy and fairness of such policies remain subjects of intense debate within South African society.

On the practical front, the Department of Water and Sanitation has put the water use license regulations review on hold, pending the finalization of the National Water Act Amendment. This delay indicates an ongoing reevaluation of the proposed regulations amid public feedback and legal scrutiny.

As South Africa grapples with these contentious policy proposals, the outcomes will significantly influence both the governance of critical water resources and the broader socio-economic landscape. Stakeholders continue to engage in a dialogue that balances redress for historical injustices with sustainable and inclusive economic development.