A big ‘no’ for budget proposal

Johan van der Merwe

Capetonians have expressed shock, anger and disappointment following the announcement of the City of Cape Town’s draft budget for the 2018/19 financial year.

Mayor Patricia de Lille tabled her R49.1 billion draft budget on March 28 which, if approved, will have residents digging deep into their pockets as tariff increases are looming on municipal services.

The City has proposed an increase of 26.9% on water, 8.1% on electricity, 26.9% on sanitation, and 7.2% and 5.7% on rates and refuse collection respectively.

Jenny McQueen, chairperson of the Green Point Ratepayers’ and Resident’s Association, expressed shock on the announcement. “It’s quite an extensive hike and we’re concerned that the City is trying to compensate for the income loss,” she said.

Ms McQueen went on to say that for the City that has been voted the world’s best and claimed to be the best-run municipality in South Africa, this is a slap in people’s faces.

The City’s water and sanitation department proposed the introduction of a fixed charge for water based on the water meter size and seven water restrictions levels while the electricity department proposes moving domestic users to the home user tariff where properties valued at above R1million will be charged a fixed service charge of R150 a month.

Chris Willemse, chairperson of the Camps Bay and Clifton Ratepayers’ Association, said they are not happy with the proposal.

“The City claims to open public comment on matters but they do not actually listen to people’s comments anyway and these are the same people who will be urging us to vote for them come election time,” said Mr Willemse.

Delivering the proposed budget in a full sitting of council, Ms De Lille, urged members of the public to weigh in and submit comments on the matter.

However, activist group, Stop City of Cape Town (Stop CoCT) has vowed to not allow the public participation process on the draft budget to be used as an “inconvenient tick box” to allow the City of Cape Town to approve what they call a “one-sided and unfair” budget.

The group released a statement which read: “Stop CoCT will ensure that the City of Cape Town does not violate the Promotion of Administrative Justice Act and misuse this public participation to pass the budget.”

The group is leading a protest march in the city centre tomorrow, Friday April 13, at 10am from Darling Street.

Johan van der Merwe, the City of Cape Town’s mayoral committee member for finance, is reported as saying that that the drought crisis had the most impact on the proposed budget as well as the affordability and financial sustainability.

“The City makes no profit from the sale of electricity, water, sanitation provision or from rates income,” said Mr Van der Merwe.

Janine Myburgh, president of the Cape Chamber of Commerce and Industry, said the City was running into trouble and rates and tariffs were now so high that many people, especially the retired, would have to downsize or move to other centres.

“We already know that many businesses are finding it cheaper to generate their own electricity and the same thing is happening with water. Desalination is not expensive but not when with competing with retail water tariffs, of more than R45. Some businesses will go off the grid and the City will lose income,” warned Ms Myburgh.

She said the key problem is high cost of governance. She said the City employs more than 27000 permanent staff and temporary staff and has another 2486 vacancies and budgeted three year of above-inflation pay increases plus notch increases.

“The staff keeps growing but the workload is shrinking as computers take over the administrative work,” she said.

Ms De Lille said on her R49.1 billion draft budget, that R39.8 billion is for operational expenditure and R9.2 billion for capital expenditure. The bulk of the capital expenditure will be spent on new housing developments, public transport infrastructure related to rollout of phase 2a of the MyCiTi service to Mitchell’s Plain and Khayelitsha and new roads to relieve traffic congestion.

The basic social package rebates are based on property values, and the total household income. These include:

Properties valued at R100 000 and below qualify for 100% rates and refuse removal rebates. These resi-dents also receive 10500 litres of free water and 7350 litres of free sanitation.

In properties valued above R100 000 and below R150000, residents get a 100% rates rebate, 75% off refuse removal charges, 10500 litres of free water and 7 50 litres of free sanitation.

Properties valued between R150000 and R400000 all receive 10500 litres of free water, 7350 litres of free sanitation and between 50% and 25% off their refuse removal charges.

There is also relief with electricity charges for consumers on the Lifeline tariff where consumption is on average 250 units per month, and these residents receive 60 units free per month.

Where consumption is be-
tween 250 and 450 units, these households will receive 25 units free each month.

“Apart from property value, the City also uses household income as a factor to determine which residents qualify for assistance. For instance, where the gross monthly household income is R4000 or below, these households can get a 100% rates rebate and receive the same benefits as if their properties were valued below R100000,” said Ms De Lille.