Cape Town – The ANC in the provincial legislature is pushing for an official probe into what it calls “Cape Town’s massive Day Zero water profits”.
ANC provincial agriculture, developmental planning and environmental affairs spokesperson Pat Marran said: “While consumption plummeted, the City kept steep tariffs in place, and even when dams ran over, it still enforced punitive restrictions.
“The City should deliver services and utilities to all residents and is not a monopoly profit-making company, chasing crude gains for a few.
“Central government departments should join hands with the Public Protector, Auditor General, Public Service Commission and South African Human Rights Commission (SAHRC) to investigate the City for abusing its power and overtaxing consumers.”
Marran quoted a report from ratings agency Moody’s which, he said, confirmed that the City has raked in R11.4 billion on water sales, with about R4.4bn as profit.
Responding to Marran, Mayco member for finance Ian Neilson denied the City had profited from high tariffs during the Day Zero campaign.
Neilson said: “The City does not make any profits on water sales. Any surpluses in any particular year are invested back into the water service in the following year. Customers get the full value of any payments that they make. The claims of profit are rejected and are misleading.”
Dismissing the report that Marran quoted, Neilson said: “Marran should provide the report. His allegations seem to be based on a tweet that is two years old, and when one tries to access this report, it is not available.”
An internet search by the Argus brought up a March 2019 report by Moody’s at https://bit.ly/3u1ErBy which said: “The decline in water usage did not negatively impact the City’s overall operating performance. High water tariffs, which were introduced to encourage water conservation, increased revenue from water sales by 7%, reaching R4.4bn (11% of operating revenue in 2018).”
Meanwhile, civil society group Stop CoCT activist Sandra Dickson said: “Our group was formed as a direct response to the City’s insistence on instituting a drought fixed charge at the height of the drought in 2017. We approached the Public Protector and the SAHRC at the time to look into the matter.
“The Public Protector and the SAHRC in Cape Town rejected our complaint. We amassed 62 000 comments/objections to the drought charge during the public participation period at the time from the public.
“The City went ahead and implemented the fixed basic water charge, which is still charged till today. This charge had been increased once in the past two years.
“We have been objecting to the City’s exploitation of the working class with its water and electricity tariff structures ever since.”
Good Party MPL Brett Herron said: “The DA leadership hijacked the water crisis for ulterior purposes. Those purposes have never been fully investigated, and what their motives were are still not clear, but I support a call for the DA’s leadership’s role in the crisis to be investigated.
“They have handled the water crisis and its approach to tariffs arrogantly and dishonestly. They are sitting on a massive windfall at the expense of the residents and businesses of this city.
“Now the City continues to rake in billions of rand from the unjust and unnecessary fixed pipe levies. Their persistence with procuring costly desalination infrastructure, despite expert advice, also needs to be investigated.”
Cape Argus