Yesterday in Council the ANC tabled the draft Property Rates Policy and By-law for 2021/22, along with increases for water, electricity, sewerage, and all other City services. Most of these are far above inflation and ignore the dire economic situation which we are in. As these proposed increases are out for public comment, we encourage all residents to write in and oppose the increases.
Many property owners have had to give discounts amounting to billions of rands to tenants that have been without income. These same property owners still have to meet their own costs of doing business such as bond payments, rates and utility charges. At the same time there has been no relief coming from the City.
According to the South African Property Owners Association, since 2008, rates have increased by a cumulative 318%, while CPI has only increased by 78% over the same period.
Even for those who are not property owners, electricity and water tariffs continue to climb even above the increases by suppliers such as Eskom and Rand Water. This hits not only the most vulnerable in our society who must commit scarce resources to these essentials, but even the middle class who are being squeezed beyond their ability to pay.
In a recent Business Day op-ed, Neva Makgetla, a senior economist at Trade & Industrial Policy Strategies, pointed out that over the past decade Eskom’s tariffs increased by approximately 160%, yet that of municipalities increased by 300%.
The DA opposed the City’s Adjustment Budget in February as the ANC increased expenditure by R300 million, most of it on paying staff who have been sitting at home, and for a new cadre recruitment drive in the Mayor’s Office. We argued that this money should instead be spent on rates and tariffs relief for residents.
Section 74(2) of the Municipal Systems Act says that tariffs must be in proportion to the cost of the services, and a 2003 circular from the South African Local Government Association states that tariffs should be linked to the proportional use of a service. The flat tariffs for sewerage and refuse removal go directly against this.
This is especially true for those living in apartments or complexes that were declared ‘multi-unit dwellings’ by the City which promptly doubled sewerage charges and sent bills for backdated amounts. Some body corporates were hit with multi-million rand bills.
The increases include 2% for property rates, 6.8% for water, 6.8% for sewerage, 9-18% for electricity, R200 charge for pre-paid residential and R400 for pre-paid business, 4.3% for refuse collection, R50 charge for recycling in ‘affluent areas’, and R276 pre-termination notice charge. All of these amounts exclude VAT.
The increase in the charge for pre-termination notices are especially galling and the charge should be scrapped entirely. Residents already pay a fortune in tariffs and other charges and the City should absorb this. The contractors they use to deliver these pre-termination notices are making a fortune off the back of residents.
We see that the City is sneaking in the R200 charge for pre-paid customers, which we oppose. The City should be encouraging everyone to move to pre-paid, not penalising them. The R50 recycling charge should be a rebate for residents to encourage recycling – again we should not be penalising positive behaviour.
Johannesburg residents deserve quality services for the money they pay the City, and this is not reflected in the increases which the ANC are putting forward. We encourage all residents to write to email@example.com and oppose the unfair increases. There should be 0% increases so that residents and businesses can use all available funds to invest and spend on economic activity which can restore the Johannesburg economy.