Charity organisation the Gift of the Givers says it will not be taking the Makhanda municipality to court.
It had been called in to help with the water crisis in the area, but now promises to focus its resources on those in need.
The charity is withdrawing from Makhanda, saying government is not paying for its services.
Gift of the Givers says that the Makhanda municipality promised it over R23-million for work it did in the region.
It claims the municipality backed out as soon as the money became available.
Founder Imtiaz Sooliman said the charity gave the Makhanda municipality a blueprint on the way forward, costing approximately R23 to R30-million.
He said the municipal council said they would not be able to afford the plan on their own, but would petition government to declare the area a disaster area.
Sooliman asserted the municipality took a unanimous decision to pass money allocated for disaster relief on to Gift of the Givers.
According to Sooliman, the Department of Water and Sanitation said R10-million would be made available to three companies in Makhanda for work on the disaster relief that the charity had already completed.
Sooliman asserted Makhanda is not the only area in the Eastern Cape facing dire water conditions.
“There is a massive crisis in the Eastern Cape,” he said.
He said there is a way to make Makhanda water secure in the next 10 to 14 days if they were given financial support.
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