City seeks public comment on rates and tariffs

THE City of Joburg recently tabled its Property Rates Policy, Rates By-law and Tariffs for the 2017/2018 financial year, which commences in July, and invites public input.

City spokesperson Kgamanyane Maphologela said following the tabling of the new Property Rates Policy in council, the City wishes to invite residents to view the draft policy and tariffs and make inputs or objections.

“Any person who desires to object to the amendments to rates policy, rates by-law and rates tariffs is invited to submit written comments or submissions on amendments, and must lodge such objections in writing,” said Maphologela.

Once the rates policy, rates by-law and tariffs are tabled in Council, they become part of the Integrated Development Plan (IDP) process, during which residents across the City can give further inputs.

Residents are also encouraged to attend the IDP process citywide, where they can make their submissions.

The City proposes an average property rates tariff set at 6.2 per cent, which is within the inflation rate. Water and sanitation tariffs will increase by an average of 12.2 per cent; electricity will increase by 2.28 per cent; while refuse removal will increase by 6.1 per cent.

The City has also announced that only indigent households registered on the City’s Expanded Social Package (ESP) programme will be eligible to receive up to 15 kilolitres of free water each month depending on the band they qualify for. All other consumers not registered in the ESP will no longer benefit from the free six kilolitres of water, as was the case before.

Maphologela said some submissions made during the first phase of the rates policy consultation meetings earlier in the year focused largely on issues related to affordability and protection of vulnerable categories. The second phase of the rates consultations will finally culminate with the IDP process.

“We heard the voices of the customers through the submissions they made during the public meetings we held. While we consider the tariffs in the context of being cost-reflective to ensure sustainability of the City, we have taken into account increased internal efficiencies and passed this benefit onto consumers by providing further relief in the final tariffs proposed,” said Maphologela.

The closing date for submissions, comments and objections to the policy and tariffs should be received no later than May 7. This process will run concurrently with the IDP process.

Comments and submissions can be sent to the following email addresses: ratescomments@joburg.org.za; pumzaj@joburg.org.za; tandisizwes@joburg.org.za or fax 0864477567

The copies of the draft Rates Policy, Tariffs, IDP and Medium-Term Budget can be viewed on the City of Joburg website: www.joburg.org.za or at the various regional offices including Rates and Taxes Office, 2nd Floor, 66 Jorissen Place, Second Floor East Wing, Braamfontein, or Region F: CJ Cronje Building, 80 Loveday Street, Johannesburg.

Additional information:

1.What is a tariff?

It’s a price, levy or a charge on services.

2. What principles and processes does the municipality follow to determine tariffs?

Tariffs are set by the City for the services it renders, such as electricity, water and refuse removal. These tariffs are reviewed once a year, with public comment sought on any increases. The annual review process is done and public input is obtained through Rates Policy Review public consultation and Integrated Development Plan (IDP) meetings, among other things.

3. What legislation or laws empower the City to set tariffs?

Section 74 of the Local Government Municipal Systems Act mandates municipal councils to adopt and implement tariff policies. The Constitution of the Republic of South Africa 1996 empowers the council to impose rates on property. In terms of Section 4 (1) of the Systems Act, the Council may levy rates on property. The Municipal Property Rates Act 6 of 2004 enables the Council to charge rates.

4. How is the price of services determined?

Tariffs for the services are informed by increases in bulk purchases rather than inflation. The percentage increases of both Eskom and Rand Water bulk tariffs are above the South African Reserve Bank inflation target range. Given that these tariff increases are determined by external agencies, the impact they have on the municipality’s electricity and water tariffs is largely outside the control of the City.

5. Is the City mindful of the current economic climate and struggling consumers when determining tariffs?

The City is aware that the cost of basket of goods, interest rates and services has increased despite the fact that we have enjoyed a decrease in petrol prices. In setting tariffs the City has to balance tensions around affordability, economic conditions, input costs while also ensuring that tariffs are cost-reflective, especially for trading services such as water and sanitation, electricity and refuse removal.

6. When tariffs are determined, how are the poor shielded and how is affordability for most people ensured?

The tariff structure is set in a manner that ensures the affordability of services, promotion of access to services and cross-subsidisation of the indigent where necessary and feasible.

7. How does are consumers encouraged to use less, save and reduce their bills?

The City has introduced a step tariff for electricity services, which implies that the more electricity consumers use, the more they will pay, with a view to reducing electricity consumption and benefiting lower consumption users.

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