City of Joburg’s budget speech: Money allocation

Residents of Joburg will have to brace themselves for a year of increases in their property rates as well as an increase in the price of electricity.

With the City of Joburg delivering its budget speech for the next financial year, most of its comprising enterprises received increases for their budget.

The budget was read out by Councillor Geoffrey Makhubo who announced that Pikitup tariffs would only increase by a margin and is in line with inflation. Rand Water will also receive a tariff increase of over ten per cent.

Makhubo announced that property rates will increase by 5.9 per cent, which he said was within the South African Reserve Bank’s inflation target range and was still below the latest inflation rate.

We have taken into account the numerous comments received from residents and have heard you. #JoburgBudget

— City of Joburg (@CityofJoburgZA) May 24, 2016

The City will now exempt the first R200 000 of all residential property and an additional 5 per cent rebate will be given to residential sectional titles. Pensioners and child-headed households, will be relieved to hear that the City will give them a 100 per cent rebate if their income is lower than R8 234 and their property is below R2 million.

Pensioners who have an income between R8 234 and R14 116 who own property under R2 million will receive a 50 per cent rebate from the City.

Makhubo made reference to the five million residents who lived in Johannesburg pointing out that the City welcomed 10 000 new residents every month.

“The new residents coming into the City every month places continuous pressure on infrastructure, housing and services but through this budget the right choices are made for the future and will build on our economic dynamism despite the challenges faced by the City,” he said.

In addition we will not be introducing the domestic city cleaning levy this year. The business tariff increases by 7.5%. #JoburgBudget

— City of Joburg (@CityofJoburgZA) May 24, 2016

Makhubo announced that the Environmental and Infrastructure Services (EISD) would receive an operating budget of R195.6 million as well as a multi-year capital allocation of R155.7 million.

The Housing Department will receive an operating budget of R1.1 billion and a multi-year capital budget of R3.4 billion. The Johannesburg Social and Housing Company (Joshco) is allocated an operating budget of R139.5 million and a multi-year capital budget of R2 billion.

City Power took a chunk of the budget with an operating budget of R16.7 billion and a multi-year capital budget of R3.9 billion.

Joburg Water is allocated an operating budget of R8.6 billion and a three year capital budget of R3.1 billion.

Makhubo also announced that the Johannesburg Roads Agency (JRA) has spent R2 billion in capital projects and have an increased year-on-year spend of 52 per cent. He added that R1 billion has been spent on road reconstruction and resurfacing to improve road quality and facilitating better mobility.

JRA has been allocated an operating budget of R884.1 million and a three-year budget capital of R3.5 billion.

Makhubo noted that after they have deliberated with residents through the public participation process that the city has embarked on. “The City’s tariff policy is based on principles that address the social, economic and financial imperatives. The correct tariff balance assist in the compilation of a credible and funded budget,” he further explained.