No debate on city pay hikes as eThekwini shaves R3 billion off budget

By Adryan Ogle Time of article published May 30, 2020

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Durban - eThekwini Municipal pay hikes were wiped off the debate table at the tabling of the 2020/21 eThekwini budget on Friday.

The electricity tariff increase is 6.22%, water tariffs are up by 9.5%, and refuse removal tariffs increase by 6.4%, eThekwini Mayor Mxolisi Kaunda announced yesterday.

He also announced that property rates would go up by 4.9%.

Deputy Mayor Belinda Scott said municipal workers’ 13th cheque and metro civil servants’ performance bonuses had been politicised.

“The ANC is not going to engage with opposition on this matter,” she said yesterday.

Opposition parties and civil society organisations had called for a halt on pay and rates increases during the Covid-19 pandemic.

According to eThekwini Municipality spokesperson Msawakhe Mayisela, ratepayers would continue to have no interest increase on outstanding amounts, and consumers could make a down-payment of 50% for debt over 90 days old, and the interest accrued would be written off.

“Arrangements to pay can be made for the balance outstanding. This interest amounts to over R1 billion. Due to the lockdown, we have had three months of no credit control, as well as no disconnections, which have had a severe impact on our cash flow,” Mayisela said.

In his budget speech, Kaunda announced that the total budget for the eThekwini Municipality for the 2020/2021 financial year was R49bn, a decrease from the R52.3bn proposed on Wednesday. The operating budget was set at R44.1bn while the remainder of the money was used for the capital budget.

“Recognising the state of our economy and the hardship felt by our residents and businesses, and following representations that have been made during the budget consultation process, the proposed (electricity) tariff increase is 6.22%,” he said.

“The water and sanitation increases - down slightly, but still 9.5% - are sheer madness. Water outages have become the norm in many parts of the city, and the city is losing half of its billable water to theft or losses,” said Nicole Graham, DA eThekwini Caucus Leader.

She also said there was a problem with the proposed wage bill of local government employees, and the DA this week launched a petition to have the 2020/2021 draft budget amended for the financial year, citing the “ridiculous wage bill” during the pandemic as a key issue.

“eThekwini has still been reluctant to clarify what it has done to reduce an exorbitant year-on-year staff cost increase of 9.5%,” Graham said.

Scott said some employed residents in the metro used Covid-19 as an excuse to not pay their service-related bills, and that all credit control and debt-collection processes would have to resume from July.

The city lost R1.5bn last month because of the drop in the collection of municipal rates and services from 96% to 56%, while R300 million in direct spend was lost over the Easter season because of low tourism numbers.

eThekwini Municipality this week said it was owed R13bn in arrears and that it would resume debt collection next month to avoid financial collapse.

Krish Kumar, chief financial officer at eThekwini Municipality, said this week that city only had R560m, which equated to six days of cash available. He said the city had spent R597m of its budget combating Covid-19 over the past couple of months.

While local civil society organisations acknowledged the city’s debt, they claimed eradicating corruption and probing double-dealing in an effort to get that money back was where the city’s attention should be, rather than draining the limited resources of the ratepayer to increase city revenue.

“There should be a complete write-off (of debts). There’s been a huge lay off due to decisions made by the government about Covid-19, now to expect poor people to pay for that. Where do people get the money from? For the last two or three months, people in the (South Durban) area have lived off soup kitchens. For now, they cannot afford anything,” said Desmond D’sa, director of the Wentworth Development Forum.

Maureen Rambhadursing, director of the Poor Flat Dwellers Movement, which oversees flat residents across the province, said state funded recipients and the elderly were at risk and were already being affected because of Covid-19 induced restrictions.

The recipients, she said, were the primary occupants of low income housing who relied on state income in the form of grants.

“Do you choose between a meal, or paying your rates?” Rambhadursing asked.

Mayisela said wage increases were left undisclosed yesterday because bargaining had not yet reached completion.

“The pay increase is a National Bargaining Council competence through a collective bargaining process. Salga facilitates this process.

“The National Treasury has requested Salga to review the salary increase,” said Mayisela.

“Salga does not comment on individual budgets of its members save to say that the budget should sensibly allocate realistically expected financial resources to ensure that the municipality continues to operate in a financially sustainable manner,” Buhle Ngwenya said.

The municipality also last week published a valuation roll for the 2017 general valuation of real estate.

The city encouraged property owners to inspect the roll to determine whether the entries reflected are a correct reflection of their property.

“The property owner may lodge an objection if he/she feels that the valuation is either too high or too low,” the municipality said in a statement.

The Independent on Saturday

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