Cape Town’s executive mayor Patricia de Lille has called for a massive increase in water tariffs across the city.
Presenting the city’s budget speech on Wednesday (28 March), de Lille said that the tariffs are set annually to ensure that the city can deliver the level of services required by the its residents.
The proposed budget for the upcoming financial year will total R49.1 billion, with R39.8 billion going towards on the operating budget and R9.2 billion allocated for capital expenditure.
This is significantly higher than previous financial years where the capital budget was in the region of R6 billion.
One of the key major allocations for the 2018/19 financial year will be the R9.8 billion which has been earmarked for water and electricity bulk purchases from the Department of Water and Sanitation and Eskom, respectively, de Lille said.
“The City’s Water and Sanitation Department is also proposing the introduction of a fixed charge for water based on the water meter size as well as seven restriction level tariffs,” she said.
“The Electricity Department is also proposing moving domestic customers to the home user tariff where properties are valued at above R1 million as well as introducing a fixed service charge of R150 per month for these properties.”
As part of the budget changes, the city is proposing a water tariff hike of 27%.
The following tariff increases are being proposed:
| Charge | Increase |
|---|---|
| Rates | 7.2% |
| Electricity | 8.1% |
| Water | 26.9% |
| Sanitation | 26.9% |
| Refuse | 5.7% |
Rebates
Despite the steep increases, Cape Town’s lower-income residents are likely to have the blow softened should they qualify for the City’s rebate programme.
“There are many residents who struggle to make ends meet and, in assisting these residents, the City provides free basic services such as electricity, refuse removal, water, sanitation and rates rebates to residents who qualify,” said de Lille.
The basic social package rebates, which are based on property values, are as follows:
- Properties valued at R100,000 and below qualify for 100% rates and refuse removal rebates. These residents also receive 10,500 litres of free water and 7,350 litres of free sanitation.
- In properties valued above R100,000 and below R150,000, these residents get a 100% rates rebate, 75% off refuse removal charges, 10,500 litres of free water and 7,350 litres of free sanitation.
- Properties valued between R150,000 and R400,000 all receive 10,500 litres of free water, 7,350 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 between 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,” said de Lille.
“For instance, where the gross monthly household income is R4,000 or below, these households can get a 100% rates rebate and receive the same benefits as if their properties were valued below R100,000.”
The following rates rebates are also granted to residents based on their gross monthly household income:
| Income bracket | Rebate percentage |
|---|---|
| Above R4 000 – R5 000 | 7.2% |
| Above R5 000 – R5 500 | 8.1% |
| Above R5 500 – R6 000 | 26.9% |
