Heading for a cliff

Geoff Jacobs, president of the Cape Chamber of Commerce and Industry. 

Citizens of Cape Town can now congratulate themselves for having the best of all possible municipal administrations – that is, if they merely read the splendid official media releases on the subject, one of which was devoted almost entirely to singing its praises.

However, a detailed study of this post-Covid-19 budget by the City from a commercial and industrial perspective, reveals a less happy picture. This new City Budget reflects all the characteristics of the previous draft circulated for comment on March 26 – it’s still aimed primarily at voters in the upcoming municipal elections.

Despite its earnest intentions, the budget fails once again to address the huge gulf between the salary and wage levels in the private sector and those paid to all 27 000 city employees – especially those at the very top of the municipal organogram.

Yes, this post Covid-19 budget proudly states that rates increases for Cape Town’s ratepayers are less than those charged by other metropoles in the country. Yes, the City “has cut expenditure in many areas that are not urgent” but it has left salaries and wages untouched, except for a token reduction in the annual bonuses which is dwarfed by the 6.5% annual increase everyone on the City payroll gets.

This at a time when large swathes of the Cape’s private sector workforce are on half pay, on unpaid leave, or have been retrenched. Those homeowners among them will still have to find money for increased rates, electricity, water, refuse and sewerage charges. For them, it is cold comfort that people in Durban and Johannesburg will pay more.

Of course, no one is supposed to question this budget. After all, the City claims it is the result of much burning of the midnight oil to “help reduce the impact of the pandemic on residents and ratepayers”.The 800 000+- ratepayers are supposed to be thrilled that so much of the City’s income that they provide is going to run what amounts to a mini- welfare state in which the interests of the civil servants are gilt-edged and untouchable, with the economic circumstances of the majority of ratepayers very much a secondary consideration.

Another claim made for this budget is the boast that it reflects a careful consideration of the invited opinions and suggestions of the public. The evidence suggests that the consideration may have been careful but was probably brief.

There is little or no evidence in this budget – or those of many years back – that suggestions made by the Chamber of Commerce and Industry have had any effect. Polite words from the city managers a-plenty but no action, sums it up.

And no wonder. The City finances and its ratepayers are at the mercy of the South African Local Government Association, in a setup where the City managers pretend to negotiate pay increases with its employees, while knowing that whatever figure emerges will greatly benefit themselves as well as union members.

This is the reason the City administration has grown into a monolith that indulges itself in welfare work more than the pursuit of efficiency and service to those who pay them.

We are supposed to applaud the welfare part of the budget and vote for a management that pays itself more than R3 million a year with annual increases built in, at a time when the Cape economy has been brought to its knees.

We are supposed to swallow a claim that “the City issaving R450 million in staff costs through a range of (unspecified) measures including a limit placed on filling vacancies, a 50% reduction in annual performance increases for management, reductions in the appointment of consultants and training programmes, and a 50% portion of long service awards (rewards) being converted into additional leave”. It is a mere scratch on a R54 billion annual budget.

So, Capetonians know that this City budget cares for everyone living within its boundaries who has a vote, pays little tax or none at all to the City, gets free water and electricity, and may or may not be unemployed. At least before the next municipal election you will be showered with attention and forgotten soon afterwards. On the other hand, if you have slaved away  for 30-40 years to pay off your mortgage, raised and educated your children, and held down a job through good times and bad, never quite keeping up with inflation; if you have run a business employing as many people as you can, paid your rates and taxes, and the rest; why, you are the citizens that now find your municipal  servants are your masters, and you better get used to it.

Financially, the City of Cape Town administration is heading for a cliff. Leading the charge to the edge is an over-manned, over paid administration that has forgotten that the money that it spends comes from the after-tax income of its citizens.

It’s time those at the top of the municipal pyramid cut their cloth, not according to their desires but with the dire straits of so many of the rate paying citizens top of mind, especially those in the private business sector.