Proposed budget will ‘make poor poorer’

Civic bodies have criticised mayor Patricia de Lille’s proposed budget, saying it will only make the poor poorer.

The municipal tariff increases tabled for the 2018/19 proposed budget, which Ms De Lille presented to a full council sitting on Wednesday March 28, include increases of 29.6% for water, 7.2% for rates, 8.1% for electricity, 26.9% for sanitation and 5.7% for refuse.

Added to the above-inflation increases, the City wants residents to pay a new monthly levy for their water meters. The levy is based on the size of the pipe feeding water to their homes and starts at R56 a month for 15mm up to R2 500 for a maximum-sized pipe of 300mm.

Domestic customers will be moved to a home-user tariff and those with a property valued at more than R1 million will have to pay a monthly R150 service charge.

The R49.1 billion budget comprises a R39.8 billion operating budget and R9.2 billion for capital expenditure.

Ms De Lille urged residents to have their say and submit comments not later than Friday May 4.

Yusuf Cassiem, interim chairperson of the Bonteheuwel Ratepayers’ and Tenant Association (BRATA), said the budget would have a “major impact” on the poor.

“The increase on the water tariffs is just an avenue they are using to make us pay for the water shortage. With the increase in VAT, petrol, food, and Eskom tariffs – all this will just make us poorer. From previous experience, we know the so-called public participation won’t make a big difference. They are financially murdering us. This proposed budget is inconsiderate to the poor and unemployed. It is about time that the City of Cape Town takes responsibility.”

Activist group Stop City of Cape Town (Stop COCT) says it will not allow the City to use the public participation process on the draft budget as “an inconvenient tick box” to approve a “one-sided and unfair” budget.

“Stop COCT will ensure 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 said in a statement.

Sandra Dickson, one of the founders of Stop COCT, said if the water tariff was approved, the already steep Level 6B water tariff increases would grow by another 26.96%. “The current Level 6B increases represented a 500% plus increase in water tariffs. These new increases, effective from July 1 this year, will add a further 83% increase to your water bill.”

Ms Dickson also criticised the water-meter levy, saying it was a “stark reminder of the drought charge based on property values which was rejected by the public in January this year”.

Vanessa Sauls, chairperson of the Heideveld Ratepayers’ Association 738, which represents beneficiaries of the 738 low-cost housing units built in the area, agreed that the proposed budget was not poor-friendly.

“Our people are already struggling. Just imagine – with that kind of increases, our pensioners would be expected to pay a minimum of R50 a day for electricity. Our pensioners are also not wasters. They work sparingly with everything they have. Some people are of the opinion that only those who live in informal settlements are poor, but there are people who live in houses and are struggling to survive. All this proposed budget will do is make us live in more poverty. Why is the City being allowed to overcharge our people? Who can hold them accountable?”

While Ms De Lille said in her speech that properties valued between R150 000 and R400 000 would get 10 500 litres of free water, Ms Sauls said that would not benefit them.

“All of us who are beneficiaries of the Heideveld Housing Development will not qualify for the 10 500 litres of free water, as the City valuated our houses at R450 000 each. Many already cannot afford the rates on this, and now they want to increase it.

“As an association, we got three different estate agencies to do a valuation of the houses, and the most any of these houses was valuated at, was R200 000. I don’t understand how the City got to R450 000. I think they know full-well how much these houses are worth, but they deliberately increased the value so that they can make more money. They know they are in trouble. Who is fooling who?”

The mayor has earmarked
R9.8 billion for water and electricity bulk purchases from the Department of Water and Sanitation and Eskom, while R5 billion has been allocated to informal settlements, water and waste services, which is 54.9% of the capital budget, R1.7 billion for transport and urban development and
R1.1 billion for energy.

Some of the developments planned for the City’s area central, include R20 million for road rehabilitation in Heideveld,
R26 million for road rehabilitation in Bonteheuwel and Uitsig, R10 million for the Manenberg Integrated Project, R30 million for electrification for backyarders and R17.7 million for electrification in various areas.

Ms De Lille said the social package of services to assist the poor would increase from R2.7 billion to R3 billion. “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,” Ms De Lille said.

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

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, 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 a 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. 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,” Ms De Lille said.