Residents of Cape Town have until 5 May 2023, to comment on the City’s ‘Building Hope’ Budget for the 2023/24 financial year.
The budget outlines the proposed projects and expenditures in various communities and neighbourhoods within the metro area, as well as the available assistance for residents and ratepayers and the suggested tariffs for services.
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According to the City’s Mayoral Committee Member for Finance Councillor Siseko Mbandezi, the budget document includes essential information such as proposed community projects, plans to improve basic service delivery, strategies to put an end to loadshedding, measures to enhance water and wastewater resilience, and the income required from rates to pay for shared services like fire services and parks.
Additionally, the draft budget recommends providing about R4.3 billion in rates and services relief, which is approximately R500 million more than the current financial year.
Here are the proposed relief highlights:
- R4,3bn social package: up from R3,75bn in 22/23, with R1,96bn in rates rebates and R2,37bn in indigent relief.
- 50% rate relief increase: proposed for all residential properties of R5 million and under, and no rates payable on the first R450 000 of all properties. Over 700 000 properties are expected to benefit, representing 80% of all properties in our city.
- More pensioners and social grant recipients will benefit from rate rebates: by raising the upper qualifying limit from R17 500 to R22 000 total monthly household income.
192 500 properties valued at R450 000 or below, or household income below R7 500, will receive these monthly benefits:
- 100% rebate for property rates and refuse removal
- 15kl free water and 10,5kl free sanitation
- Up to 60 free electricity units
- Lifeline tariff changes: Customers consuming more than 350 units currently pay R3,71 per unit, but with changes to the Lifeline tariff structure, they will now pay R1,84. Lifeline customers do however still need to be mindful that the Block 1 threshold was raised to 600 units to allow people to use more during winter months, and that an average monthly consumption limit of 450 units still applies over a 12-month period to remain in this tariff category.
‘The City has reduced Eskom’s 18,49% increase to 17,6%. This reduction amounts to some R15 million per month that the City is absorbing while still funding a reliable electricity service and plans to end the City’s sole reliance on Eskom’s expensive power as soon as possible. If the City were to absorb the entire tariff increase, it would amount to more than R180 million per year. The City, and its ratepayers, simply cannot afford this.’
‘About 70% of the City’s tariff income goes toward buying bulk electricity from Eskom, the biggest cost driver, with the remaining 30% invested back into service delivery and ending load-shedding,’ said Councillor Mbandezi.
The proposed increase in rates revenue required:
- Property rates: A 6,9% increase is required to fund shared services such as parks, fire services and health.
Here are the proposed average tariff increases:
- Water and sanitation: 8,6% (to cover costs and build water resilience, as Cape Town is in a water-scarce region)
- Electricity: 17,6% (Eskom- and loadshedding-driven)
- Refuse: 5,5%
All income generated from these tariffs will be utilised to cover the cost of service provision.
View the tabled budget here – draft budget, or go to your nearest sub-council office or library for a copy of the budget.
For providing comments on the ‘Building Hope’ Budget, you can either send an email to [email protected] or call +27 0800 212 176.
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