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City approves inflation-based tariff increases

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City approves inflation-based tariff increases

by Martin Pollack
03 Jun 2008
City of Cape Town
City of Cape Town

A full Council approved the City of Cape Town's 2008/2009 budget on 28 May, with moderate, inflation-based increases to rates and tariffs.

"This year's moderate increases in the water and sanitation tariffs are partially due to the significant improvement in payments for those services over the past two years," says Executive Mayor Helen Zille.

"Last year's increases in tariffs brought our funding for tariff based municipal services up to the right level. We therefore expect to be able to keep further annual increases close to inflation, with the exception of electricity," she says.

From 1 July, water tariffs will go up by 9.2%, solid waste tariffs by 7, 5% and sewerage tariffs by 6%. Property rates will increase by 7,3%, bringing the new charge to 0.493 cent-in-the-rand for residential properties and 0.924 cent-in-the- rand for commercial properties.

In addition, the City approved an average 20% increase in its electricity tariff, based on the National Energy Regulator's (NERSA's) approval of Eskom's price increases in December 2007, as well as the anticipated impact of energy reduction targets to municipalities.

Senior citizens and disabled persons with a gross monthly household income of less than R2 880 will now receive a 100% rates rebate – up from last year's R1 740 cut-off.

"This is a dramatic improvement in the City's Indigent Policy which provides relief for Cape Town's most vulnerable groups," says Mayor Zille.

Other benefits include:

* Free services, subsidies and rebates for persons registered as indigent
* 6 000 litres of water free each month for all households
* 100% rebate on rates for indigent households
* 50 kWh of free electricity per month for low-electricity users
* Free or subsidised refuse collection for residential properties valued at less than R300 000. First R88 000 of all residential properties exempt from property value rates
* Monthly subsidy of R30 on water and sanitation for indigent households and houses valued up to R199 000
* Upper limit for rates rebates to the disabled and elderly raised, from a gross monthly household income of R5 000 per month to R7 000 per month
* Retirement schemes and life-rights schemes will now pay residential rather than the commercial rate

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