The Draft Budget for the 2021/22 financial year was tabled for public consultation at the sitting of Full Council on 31 March at the Inkosi Albert Luthuli Convention Centre.
Mayor Kaunda said that the City has always considered the plight of the poor and this budget is no different. “This is a pro-poor budget with many elements that relieve the burden on consumers, particularly, the tariff increases. The 2021/2022 MTREF which is a balanced, fully funded, credible and realistic budget. This budget is based on the principle of ensuring affordability and sustainability without compromising service delivery. It is a budget of hope.”
The consolidated budget (operating and capital expenditure) amounts to 52.3 billion. Consisting of an operational budget of R47 billion and a capital budget of R5.3 billion. The budget is prepared under various considerations including the national economy being under major strain and stress, low economic growth and high unemployment.
Proposed tariff increases:
Notwithstanding the impact of COVID and the current state of the economy, tariff increases for 2021/2022 will be at an all-time low, as compared to the past 6 years. The tariff increases are mainly due to the bulk tariff increases by Eskom and the Umgeni Water Board which are all above inflation and out of the control of the City. In addition, the City had to make provision for a Consumer Price Index related increase in salaries. “Despite all the challenges, we have tried to keep the increases to affordable levels considering the tough economic climate facing our residents.”
Property Rates and Refuse tariff increases have been kept to a historical low of 4.9%. This once again demonstrates that the City sympathises with the plight of its struggling citizens. The Water & Sanitation tariff increase is 8.5% for both residential and business due to the Umgeni Water Board increase of 7%. The Eskom bulk tariff increase for electricity is 17.8% which has resulted in an increase of 14.9% for electricity by the City and which is the recommended increase for municipalities by the National Energy Regulator of South Africa (NERSA).
The 2021/22 Draft Budget includes an unrivalled social package programme, to the value of over R4.7 billion, coupled with the recently adopted Indigent Policy where customers that are struggling to pay for services, benefit from the below basket of services.
Rates: Residential Properties valued up to R230 000 will be exempt from paying rates. All other properties valued above R230 000, the first R 120 000, no rates charged. A further allowance will be afforded on application to all residential property owners with a total household income of R3760.00 and less and with a property value of more than R230 000 and less than R500 000. Pensioners, child-headed households, disability grantees and medically boarded properties are exempt from paying rates, where their annual rates do not exceed the maximum rebate of R5 290. All other properties will be liable for tax less the rebate. No rates levied on the first R30 000 value of vacant land and Outside the Urban Development Line.
Water: The first 6kl of water is free to households with property values under R250 000.
Electricity: The first 50kwh of electricity is free to residents using less than 150kwh per month in Eskom reticulated areas. The first 65kwh of electricity is free to residents using less than 150kwh per month in eThekwini reticulated areas.
Refuse Removal: Residential property valued up to R 250 000 are exempt from domestic refuse removal tariff. In addition, a free basic refuse removal service is also available to indigent consumer units living in rural, informal settlements and non-kerbside residents.
Sanitation: The first 6kl of effluent disposal is exempt for all properties with values under R 250 000. In addition, a free basic service is also available to indigent consumer units with VIP’s, urine diversion toilets and in informal settlements serviced by means of a toilet/ablution block within 200m.
The draft Budget will be consulted regionally together with the draft Annual Report and the draft Integrated Development Plan starting in April. Consultation will also be held through various digital media platforms. The deadline for submissions is 15 May and the final budget will be adopted at the end of May.
