Water tariff shock looms

Dolphin Coast ratepayers face a massive increase in the price of water, apparently because the area “can afford it”.

Umgeni Water wants to increase Sembcorp Siza Water’s water tariff by an exorbitant 41.1 percent from July 1 this year.

This means Siza Water customers can expect a steep water tariff increase on top of last year’s 11 percent increase, an increase of one-and-a-half times in two years.

Chairman of the Dolphin Coast Residents and Ratepayers Association (DOCRRA), Louis Luyt, said this would increase inflation in the area and stifle growth.

He said if people pay that much more for water they will have less disposable income to spend at local businesses and businesses will suffer.

“This is not Siza Water’s problem; it is Umgeni Water’s problem,” he said.

Luyt blames Umgeni Water’s “inherent incompetence” in how they manage their internal infrastructure for their need to drastically increase water tariffs.

He said raising the Hazelmere Dam wall was proposed more than a decade ago but Ballito has never been a priority.

They had done nothing to upgrade the rapidly expanding area’s water infrastructure for decades and now the consumer has to bear the cost of addressing water shortages.

Lifestyle Centre manager Mark Pearse said another stiff increase would have a huge impact on operating costs.

It was already very difficult to keep the centre up to standard with water shortages.

The restaurants were hit particularly hard.

“Utilities is a major problem for any business and such a rate increase will make it very difficult to maintain standards at the centre,” said Pearse.

Ballito councillor Colin Marsh said Umgeni Water proposed the 41.1 percent increase because they believed Siza Water served an affluent area that secured a consistent stream of income.

From correspondence between Umgeni Water chief financial officer Thamsanqa Hlongwa, and Siza Water managing director Shyam Misra, it is understood that Umgeni Water needs money to pay for infrastructure developments like the Avondale pump station to supply the Avondale reservoir at the Hazelmere water works, the Lower Thukela bulk water supply scheme and its system, and the expansion of Hazelmere water works that Umgeni Water promises will limit future water shortages.

Misra has been fighting the proposed increase tooth and nail but Umgeni Water has already submitted their proposal, along with Siza Water’s objections, to water and sanitation minister, Nomvula Mokonyane, for approval.

“For Umgeni Water to now impose an increase on Siza Water of 41.1 percent for the 2015/2016 year is shocking, especially as all other bulk water consumers on the North Coast pipeline, including Ilembe, are only being asked to pay an increase of approximately 8,3 percent,” said Misra.

“Umgeni Water’s claim that Siza Water must subsidise poor consumers in other concession areas falsely assumes that every consumer within the Siza Water concession area is rich. More than 50 percent of consumers supplied by Siza Water fall in the category of poor people who qualify for free or subsidised basic water services.”

Umgeni Water CEO Cyril Gamede, told the Courier that Umgeni Water has to recover the money they invested in infrastructure.

“I am sure as seasoned business people, Siza Water should understand that infrastructure should be paid for by the users,” said Gamede.

Misra said that a meeting with Umgeni Water and Ilembe district municipality has tentatively been scheduled for this week and Siza Water will after this meeting develop their strategy and calculate the cost that will be passed through to the consumer.

“Our goal is to ensure we receive a fair and equitable increase for not only ourselves but also our consumers and we will be prepared to go to great lengths to do so,” said Misra.

Affected areas include Ballito, Tinley Manor, Salt Rock/Shakaskraal, Etete, Nkobongo, Shayamoya and Zikkhalafukwe.

Siza Water is part of the Singapore-owned Sembcorp Group.