The Property Rates Policy, which includes the increased property tariffs, are now open for public scrutiny until 7 May.
MaNy residents might still not understand a few key concepts about how tariffs are implemented, who agrees to the increased amount and what the City of Johannesburg is doing to help residents save on their ever-increasing bills.
What is a tariff?
It’s a price, levy or a charge on services.
What principle and process 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 and public input are obtained through the Rates Policy Review public consultation and Integrated Development Plan (IDP) meetings.
What legislation or laws empower the City to set tariffs?
Section 74 of the Local Government Municipal Systems Act requires the council to adopt and implement a tariff policy. The Constitution empowers the council to impose rates on property. In terms of the Systems Act, the council may levy rates on property. The Municipal Property Rates Act number 6 of 2004 enables the council to charge rates.
How does the City decide how much to charge for services?
Tariffs for the services are formed 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 the fact 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.
Is the City mindful of the current economic climate and struggling consumers when determining tariffs?
In setting tariffs, the City has to balance tensions around affordability, economic conditions, input costs whilst also ensuring that tariffs are cost-reflective, especially for trading services such as water and sanitation, electricity and refuse removal.
When determining the tariffs, how does the City shield the poor and ensure that most people can afford to pay?
The City’s tariffs structure ensures the affordability of services, promotion of access to services, cross-subsidisation of the indigent where necessary and feasible.
How does the City encourage consumers to use less, save and reduce their bill?
The City has introduced a stepped 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.
Source: City of Johannesburg Group Finance
Read: EXCLUSIVE: Gentlemen’s club DJ gives a peak into his territory in the city of Joburg
