The City of Cape Town has increased rates and tariffs by an average of 4%. Letters were sent to residents explaining that the new financial year began on July 1 and as such, there are new rates. The increase is believed to be the lowest in any South African metro.
The average increase is as follows:
– Rates: 4%
– Electricity: 4,8%
– Water and sanitation: 4,5%
– Refuse removal: 3,5%
The City explains that the increase will on average be 4%, but this is dependent on the situations of each resident. For example, indigent people will not be affected by the increase if they stay within their free basic allocation of water and electricity.
“In an ideal world, we would have preferred to have no rates and tariff increases this year because of the COVID-19 economic impact, but as it is, the cost of providing services outpaces the income we get from rates and tariffs which is used to pay for the provision of services. We are therefore introducing conservative increases by cutting costs and changing programmes and plans,” reads a customer letter from the City.
“All income received from rates and tariffs is used for the provision of basic services, which is our main mandate as a municipality. We do not budget for a profit on this income.”
Approximately 70% of the monthly costs required for basic services come from rates and tariffs.
The COVID-19 pandemic has impacted the City’s finances, and made it difficult for them to keep increases low. However, they say they have implemented the lowest increases of any metro in South Africa, as far as they are aware.
R3.3-billion is available for rates and tariff relief. Those severely impacted financially by COVID-19 can contact the City to find out more about the relief options available. Interest-free payment arrangements are available for those who qualify.
Read the City’s rates and tariffs explanation here: Rates_and_tariffs_increase_202021