Buffalo City Metro residents and businesses face steep electricity and water tariff increases from July after the ANC pushed through a R12.8bn budget by the narrowest possible margin following a chaotic council sitting.
The budget, approved by the minimum of 51 votes required in the 100-member council, includes an 11.1% surge in electricity tariffs, an 8.33% increase in water tariffs, a 4.7% hike in sewerage and effluent charges and a 2% rise in property rates.
The electricity increase is higher than the 8.76% tariff increase approved for Eskom and implemented in April for municipalities that buy power from the utility.
Business organisations and ratepayer groups warned that the increases would place additional pressure on households and companies already battling because of the weak economy.
The monthly prepaid electricity meter service charge will also increase from R487.49 to R530.15, including VAT.
One area where residents will receive some relief is the controversial credit meter service charges introduced two years ago.
The monthly charge will decrease from R880.15 to R591.45.
Council approved the budget before the May 31 deadline imposed by the Municipal Finance Management Act, which requires municipalities to adopt annual budgets at least 30 days before the start of the new financial year.
However, the ANC struggled to ensure enough councillors were in attendance to pass the budget.
When the meeting resumed on Thursday, 66 councillors were present, including 39 ANC councillors, 16 from the DA and seven EFF members.
The EFF contingent later left the meeting, saying its councillors had to attend a programme in Mdantsane. That reduced attendance to 59 councillors.
With the ANC short of the 51 votes needed to pass the budget, proceedings were repeatedly delayed.
The ruling party called for a caucus and council remained adjourned for about 90 minutes.
ANC sources told the Dispatch party members used the time to contact absent councillors and persuade them to attend the meeting to make up the shortfall. Several councillors eventually arrived.
When proceedings resumed, mayor Princess Faku said one councillor had been called in from a doctor’s appointment.
By the time voting took place, 70 councillors were in the chamber. The budget was approved with 51 votes in favour and 16 against.
The DA voted against the budget, while councillors from the African Transformation Movement (ATM), ACDP and PAC abstained.
ANC councillors broke into song after speaker Humphrey Maxegwana announced the budget had passed.
DA councillor Geoff Walton said the party could not support what it viewed as a flawed budget process.
“Despite a formal process plan outlining political workstreams for engagement, these platforms never materialised, leaving councillors frozen out of the drafting phase.”
Walton questioned the budget’s financial assumptions and criticised the tariff increases.
“The proposed 11.1% increase in electricity tariffs far outstrips the 8.76% Eskom increase, and similar patterns are seen in water and waste collection.”
However, he said the reduction in the credit meter service charge was welcome and reflected what the DA believed had been an excessive charge since the fee was introduced.
ATM councillor Mandisa Mashiya, who abstained, said she was frustrated by the lengthy delay while councillors were being called to attend the meeting.
“I could not associate myself with those voting against the budget, but equally I could not vote with the ANC while many of its councillors opted to stay at home and did not attend the meeting.
“The fact that we also had to wait for so long for them to be called and arrive in council really annoyed me.
“So, I told myself that I was not going to be played for a political fool by anyone,” Mashiya said.
Black Business Forum president Luthando Bara said the combined impact of higher electricity, water, sewerage, property rates, fuel, transport and labour costs could make it harder for small businesses to remain profitable.
“When municipalities implement above-inflation tariff increases, many small businesses are left with only a few options, such as absorbing the costs, which reduces already thin profit margins, passing the costs on to customers, which will reduce sales, or reducing costs elsewhere, often by freezing hiring, reducing working hours, or retrenching staff,” Bara said.
Beacon Bay Ratepayers’ Association chair Scott Roebert welcomed the reduction in credit meter charges but said residents remained concerned about cable theft, illegal connections and tampering with meters.
“If strong measures were implemented in these areas, the burden wouldn’t need to be passed onto the very ratepayers who keep bailing the metro out,” Roebert said.
Border-Kei Chamber of Business chief executive Lizelle Maurice said businesses were disappointed they had not been consulted.
“We would have told them business is already stretched. The economy is tight. The cost of doing business has increased.
“They should have reduced rates or given some incentive to bring relief.”
Maurice said the metro should focus on addressing losses from theft, vandalism and mismanagement rather than imposing further increases.
The Quigney Ratepayers’ Association’s Gabi Booi said more hikes would burden residents and businesses.
“Businesses will transfer this cost to consumers.
“Unfortunately, these continued tariff increases do not translate to improved municipal services.”
The municipality was asked to respond to criticism of the scale of the tariff hikes as well as questions on the consultation process but had not done so by the time of publication.
Daily Dispatch
