Cash-strapped ratepayers cry foul at proposed KwaDukuza municipal salary and rate increases

Proposed rates and salary increases for KwaDukuza municipality (KDM) staff and councillors have been met with heavy criticism by ratepayers as households struggle to survive in the face of the Covid-19 economic collapse.

Ratepayers are fighting back against the planned tariff increases with an online petition started last Thursday that has garnered more than 3000 signatures and rising.

Spearheading the petition, Ballito resident Riaan Verster said the proposed tariff increases were not affordable and unfair.

“The increases do not take into account the hardships faced by the ratepayers over this current pandemic crisis who get little to no service delivery in return for ever increasing rates and fees.

“Streetlights are still in a state of disrepair and little has been done to maintain or improve existing municipal infrastructure.

“It is clear from the prior annual reports of KDM which reflect massive irregular expenditure and adverse audit opinions that the municipality is being mismanaged and the residents and ratepayers alike are fed up.”

The municipal draft budget proposes a 5.2 percent salary increase, backdated to July last year.

This is slightly higher than the consumer price index of 4.5 percent.

This will see councillors’ remuneration costs jumping from R24 million to R25.3 million in the next financial year.

The inflation-beating salary increases are in a budget that proposes tariff increase of rates by six percent, water by 9.9 percent and sewerage and refuse by four percent.

Domestic electricity tariffs are expected to increase by 6.9 percent as per the National Energy Regulator of South Africa (NERSA) approval of Eskom’s allowable revenue from standard tariff customers.

The total wage bill for municipal staff in the draft budget is about R447 000 million.

The basic annual package for the mayor will be R893 850 while the deputy mayor and speaker will receive R715 078.

Exco members and the chief whip will get R670 387. Part-time councillors will receive R282 870 and a district appointed councillor will get R1 103.23 per day.

Councillors will also receive phone and data allowances of R3 400 and R300 per month respectively, plus expense accounts. The wage bill, which absorbs more than 25 percent of municipal spending, has been a major driver of rising costs.

In addition, the budget also provides for performance bonuses for senior managers.

A R146 299 performance bonus for the municipal manager will take his total remuneration package to R1 994 358 million.

This despite KDM under-spending on its capital budget in the 2019/20 financial year which had a direct impact on various capital projects and service delivery.

The municipality also recorded about R60 million in irregular spending.

Key budget assumptions made in the draft document are that the country is not expected to go lower than level three lockdown this year and there is a strong possibility that level five lockdown could be re-instated in September throughout the Ilembe district if the infection rate peaks then.

Dolphin Coast Ratepayer and Residents Association (Docrra) chairman Deon Viljoen said they believed any salary increases for KDM should mirror what President Cyril Ramaphosa had requested from government officials and employees.

“Either a maximum of 1.5 percent or no increase at all for the next financial year. Docrra also trusts that most KDM employees have voluntarily contributed four percent of their salary to the Solidarity Fund, as requested by the president.”

In a letter sent to the minister of Cooperative Governance and Traditional Affairs (Cogta), Dr Nkosazana Dlamini-Zuma, and copied to the President as well as all provincial CoGTA executive council members, the civic group Organisation Undoing Tax Abuse (Outa) called on all public office bearers and management to respect citizens by reducing the cost of government on the taxpayer.

Outa CEO Wayne Duvenage said the proposed salary increases were a slap in the face when government should be forcing municipalities to take drastic measures to reduce costs.

“Why should citizens have to finance any salary increases for public servants and councillors while businesses are having to curb costs, cut expenses, retrench staff or force them to take unpaid leave? There should be no salary increases or bonuses paid at any level of government. Now is the time for society to witness a proactive approach by government, as well as negotiations with unions for people employed in our towns and cities,” he said.

Results from a recent business impact survey of 707 businesses conducted by Stats SA indicated that 36.8 percent reported that their workforce was expected to decrease.

Almost 10 percent of respondents reported that 81-100 percent of their workforce had been made redundant while four in ten businesses felt they could not continue to operate.

A whopping 42.2 percent said they were not confident they had the financial resources to continue operating through lockdown.

President of the iLembe Chamber of Commerce and attorney Andrew Horton said that while the minister of Cogta makes the determination on the salary increases, individual municipalities determine whether to introduce the increases into their budget or not.

“I think there should be a better process in place when it comes to salary increases and performance bonuses. They should be linked to the financial health of a municipality and whether it has received a clean audit or not. “However, during these challenging times government should carefully consider whether to go ahead with these implementations, given the poor and working class communities will be the biggest victims.”

While the country was already in a recession before the coronavirus pandemic, it has since been downgraded by all credit ratings agencies.

Ilembe Chamber CEO Cobus Oelofse said: “The targeted revenue growth and expenses of any municipality cannot be tone-deaf to this dire reality – which will result in a balancing act considering the obligation to ensure fiscal well-being, maintaining of service levels and the needed investment in infrastructure.

“Like any other business, revenue and expense increases, especially increases that outstrip the forecasted levels of inflation, will attract attention.

“The Chamber’s submission on the budget will also reflect the current somber sentiment of our business community.”

KwaDukuza municipality spokesperson Sipho Mkhize said salaries were a legislative matter and not something the KDM council or mayor could unilaterally decide on.

“The matters are discussed at bargaining council and some have ministerial directives on how they are to be paid. As a means to assist those who are less fortunate and in need during this period,

Council has encouraged all its councillors and staff to donate contributions to the National Solidarity Fund.”

Ratepayers have until June 15 to give their input on the draft budget which can be reviewed by logging onto KDM’s website .

Objections and comments can be emailed to the municipal managers office at municipalm@kwadukuza.gov.za.

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