Durban residents can expect substantial hikes for services the city's draft budget shows.
Durban residents can expect substantial hikes for services the city's draft budget shows.

eThekwini draft budget plans big water, electricity price hikes

By Tanya Waterworth Time of article published Apr 11, 2020

Share this article:

Durban - As eThekwini residents reel from loss of income or retrenchments, and a shattered economy, the city has announced hikes of 6.9% for electricity, 9.9% for water and 9.9% for sewerage and refuse.

Those are the proposed tariffs in the eThekwini Municipal Draft Budget 2020/21 which was opened for comment on Thursday.

The city issued a press release about its R52.3billion draft budget for the 2020/21 financial year, which included an operating budget of R45.4bn and a capital budget of R6.9bn.

With regards to tariff increases, the statement said: “Considering the current challenges, the drafting of the budget was severely restricted.

“Tariff increases have been substantially decreased from the MTREF (medium term revenue and expenditure framework) projections. Major efforts have been put in place to ensure realistic and affordable tariff increases.”

The proposed tariffs are:

Electricity: 6.9%

“The electricity tariff increase is proposed at 6.9% which is a 50% reduction from the anticipated increase in the MTREF,” read the statement.

Water: 9.9%

An increase of 23% was initially forecast to balance the municipal budget.

“However, following the review by the Budget Prioritisation Committee, negotiations with Umgeni Water Board to reduce their tariff increase to 6.9%, a tariff increase of 9.9% is being proposed. Compared to last five years’ increases of 15%, this is a welcome relief to consumers. The city has made every effort to keep eThekwini’s sales tariff to a minimum. The rollout of the Western and Northern Aqueduct projects have also impacted the water tariff increase,” read the statement.

Sewerage and Refuse Tariffs: 9.9%

“The forecast increases for sewerage and refuse tariffs were both 15%. However, following the re-prioritisation and reviewing of all expenditure items, the increase has been reduced to a more affordable 9.9%.”

Meanwhile, salary increases for city officials propose a 6.25% increase, with the mayor’s report in the draft budget stating (under Operating Budget) that “due consideration was taken of the current economic climate and cost containment regulations. Accordingly, the increase in expenditure was restricted to approximately 5%.

"Currently, we are locked into a three-year agreement with regards to salary increases which requires a provision for a 6.25% increase in salaries and a further 0.5% for notch increases. However, we have already taken steps to help address the salary costs. No provision has been made for new posts.

“Rationalisation of all vacancies has been called for in terms of rightsizing the municipality’s organisational structure. All vacancies and posts must be motivated in terms of return on investment and the business case.”

The media release further stated: “The budget has been tabled at a time when the country faces an economic crisis, together with the outbreak of the Coronavirus (Covid-19) pandemic that has brought markets to a standstill, globally. The city however assures residents that, despite these challenges, uninterrupted service delivery remains a priority.

“The city is fully aware of the ramifications of the national lockdown on income and have taken measures to assist residents during this crisis. The city, together with other metros, are also in discussions with National Treasury to allow consumers to enter into payment arrangements after the lockdown has been uplifted. This is however dependent on the state of the economy and affordability at that time.”

To view the Draft Budget, go to: http://www.durban.gov.za/ResourceCentre/reports/Budget/Pages/default.aspx

Residents are encouraged to comment on the proposed budget, until May 8, 2020, via email: [email protected] or [email protected]

The Independent on Saturday

Share this article: