Residents of Ekurhuleni will have to pay an average of 7.5 percent more on their municipal accounts when the metro’s next financial year starts on July 1.
This came to light during Ekurhuleni metro’s March meeting when they approved its draft reviewed Integrated Developmental Plan (IDP) and medium-term revenue and expenditure framework, the process that the metro uses to draft its budget.
The details of the budget will, during the next two months, be scrutinised in the different metro portfolio committees before being approved on May 29.
According to the draft the 2014/15 budget will amount to R29.8 billion.
This budget consists of the operating expenditure, used for the metro’s every day running, that will amount to around R26.3-b and the capital budget will be R3.5-b.
The capital budget is largely driven by projects from the IDP and the metro’s growth and development strategy, as well as projects identified by the community and backlog in services.
The capital budget gets its funding from external sources.
The funds the metro gets from residents’ rates is one of its biggest forms of income on the operational income.
That’s why every month’s percentage of collection of rates accounts is crucial for the metro.
The metro based their income on the 2014/15 budget on a 93 percent collection rate for each month.
Electricity is the biggest source of income of this part of the budget, representing R11.7-b or 49.6% of the total operational income.
Property rates are the second largest revenue (17%). The rest of the operating income come from operating grants and transfers from other spheres of government.
The rates increases from July 1 include 7.5% for assessment rates.
Electricity has an average increase of 7.39%.
Tariff A residential users will pay 6.3% more and Tariff A businesses 7.5%. These are consumers that use less than 750kWh per month and has a capacity of a single phase connection up to 80A per phase.
For Tariff B, the larger consumer of electricity, both residential and business users will have to fork out 7.5% more on their electricity.
Water tariffs will increase by 8.1% in the new financial year. This is the same percentage the metro has to pay for increased bulk purchases of water.
Sanitation costs will increase with 8%, as this would be the proposed sanitation tariff of their supplier, Erwat.
Increases of refuse removal was diversified, due to the unique circumstances of various income sources. Refuse removal services to residential areas will increase between 2.4% and 7.1% and that of businesses by 6%.
A tariff increase of 15% was proposed for dumping at a disposal site.
The metro during the next financial year continues its commitment in its assistance to the poorest of poor by giving them free basic services.
These services will amount to more than R2.3-b on the metro budget.
The people that cannot afford services will receive 6kl of water free each month and 6kl free sanitation, while indigents get an additional 3kl of each free.
Because of the slow pace of registering indigents, the metro considered a targeted approach on indigents, like other South African metros.
They regard all residents with property values less than R150 000 as indigent.
On assessment rates for residential properties all home-owners will continue to receive assessment rate exemptions on the first R150 000 of value of the homes.
Free basic electricity will be dealt with as specified by the metro’s policy on this.
People that converted to a prepaid meter, as well as new connections with a prepaid meter will receive a once-off allocation of 40kWh units to allow purchase of electricity using this method.
