Durban- Cash -strapped Durban pensioners are feeling the pinch following the property rates increase that has become so unaffordable that some are selling their homes to downsize.
At a Hillcrest estate, 80 of 680 units have put up for sale signs as their owners – pensioners aged between 60 and 89 – can no longer afford to pay the rates.
In July, the eThekwini Municipality announced that the rates rebate for senior citizen property owners had been revised from R3 million to R2m.
This means pensioners whose property is valued at more than R2 million no longer qualified for the R336 a month rebate.
The financial burden is compounded by rates increases due to higher property valuations.
Pensioner Dave Marshall’s home was was previously valued at R1.6m. When the new valuations were done in February, his house was valued at R2m.
“So effectively, my rates have increased by 72%,” he said.
Marshall wrote to Mayor Zandile Gumede requesting a meeting. In his letter, he detailed how, at the estate he lives in, 77% of the residents had lost their pensioners rebate since the threshold was decreased.
The feedback from the pensioners at the estate he lives in revealed that most lived on a pension of between R12 000 and R15 000 a month.
“Their monthly rates increase of approximately R500 a month is literally the last straw that breaks the camel’s back,” said Marshall.
He said the only response he received to this letter was an acknowledgement from the mayor’s office.
However, city spokesperson Tozi Mthethwa said: “The city met with a delegation from (the estate) to discuss this matter and all the issues were clarified.”
Upper Highway pensioner Pete van der Spek, 65, also lost the rebate and now pays R700 more a month for rates, after his property valuation went up from R2.5m to R3.2m.
“Overnight, I have to find R700 extra," he said.
"What the council (municipality) doesn’t realise is that we can only benefit from the higher value of our homes if we sell, so in the meantime they are getting more income by increasing rates far beyond inflation.”
Money is so tight that Van der Spek is now contemplating moving to Cape Town where his son lives and where “the rates are far lower”.
“My pension hasn’t changed since I’ve gone on pension; this increase puts me in a difficult position which will have a great impact on my cost of living,” he said.
Former chairperson of the defunct Combined Ratepayers’ Association of Durban, Lilian Develing, 82, said with the rise of the cost of living, pensioners were struggling with this additional blow.
“You work all your life and when you retire there is still a heavy financial burden,” she said.
Develing bought her home in 1986 for R110 000. She put it on the market two years ago for R2m.
“It’s safe to say if we had kept the house, the rates would have gone up, and with the the rebate taken away, along with petrol, food, water and electricity costs, how can one afford it all with a pension?” she asked.
She said she believed there wasn’t sufficient consultation and opportunity for discussion.
“When you go to these meetings, all they (the municipality) tell you is what they are going to do, and if you have any questions they just tell you to write, but they never reply.”
However, Mthethwa said the municipality had embarked on a process to address the plight of pensioners in previous years by collecting data, “but senior citizens refused to provide information on their income”.
She said the provision for the threshold for the relief for senior citizens was influenced by and based on the municipality’s budget.
“The review and change was implemented under the guidance of National Treasury, who advised that eThekwini had the highest indigent package in the country and this was unsustainable.
"This was amended after consultation with stakeholders through the budget planning process and has also helped to target the correct households.
"Additionally, this is part of the city’s austerity measures,” she said.