eThekwini's R71bn budget gets thumbs up from ruling coalition

TimesLIVE

3 days ago

The eThekwini council on Thursday gave the green light to a R70.9bn budget for the 2026 fiscal year, after a second consecutive year of revised tariff increases.
Mayor Cyril Xaba had previously tabled the revised budget on Monday where he announced it had been reduced from the proposed R71.3bn owing to tariff hike adjustments.
The municipality decided to scale back on some of the tariff increases it had initially proposed in the draft budget after a public outcry during the consultation processes.
The increases include:
13% and 14% for water in households and business, down from 15% and 16% respectively.
11% and 12% for domestic and business sanitation respectively, down from the proposed 13% and 14%.
Refuse collection has been reduced to a 9% increase from the proposed 9.9% for domestic households, which is in line with that of business.
5.9% for property rates from the proposed 6.5%
The city has further increased the rebate on vacant land from 10% to 30%.
The electricity increase, however, remained unchanged at 12.72% after the city could not convince Eskom to reduce its 11.32% hike.
'We failed to win our argument with Eskom. They pleaded that the cost of providing services has increased and that they can't improve the tariff,' Xaba said on Monday.
The main opposition party, the DA, disapproved of the budget, saying it lacked the necessary elements to rescue eThekwini from its challenges.
Councillor Andre Beetge said he did not share Xaba's optimism on the budget because it sounded like a repetition of previous promises. He said the 'strategically' reduced tariffs were just a smokescreen while the underlying issues remained unresolved.
Chief whip Yogis Govender argued the overall impact of the tariff hikes remained significant for consumers despite some slight decreases.
'I couldn't help but note the mayor saying that some tariffs came down by a few percent but what you are really saying to consumers is that 'this bottle is selling for R500 but I feel sorry for you. I hear you so I will sell it to you for R499. 99 because that's how caring we are.' The reality is the pinch will still be felt because an increase is still an increase,' she said.
'You are taxing your fast-shrinking rates base into extreme financial distress. Life is extremely stressful for the taxpayer in eThekwini.'
ActionSA leader Zwakele Mncwango said the budget failed to adequately address the needs of residents.
'The proposed tariff increases are excessive and will further burden our citizens who are also struggling. The 13% increase over tariffs is so high while we're facing 58% water loss and the 11% increase in sanitation tariffs will have significant impact on low income households and make it even more difficult for them to access basic needs.'
He added it did not provide sufficient funding for critical services like public transport, crime prevention and land management.
He further questioned the city's financial management, highlighting concerns over collection rates and decreasing revenue while expenditure increased.
'This will have long-term consequences for the municipality's financial health. Furthermore, irregular expenditure continues to increase, which is unacceptable and raises questions about the municipality's ability to manage its finances effectively.'
The EFF welcomed the budget, saying that the adjustment of tariff increases would provide relief to residents. The party said they would've called for no tariff increases but noted circumstances do not allow for that.
'We have our reservations because we wouldn't necessarily want tariff increases but at the same time we understand that eThekwini is 60% rural and 40% urban, meaning we have a very low tax base to collect from — which is why you find that our rates are not like other municipalities.'
Xaba said the budget aimed at accelerating service delivery through improved revenue collection and infrastructure development.
He said the city was largely dependent on effective collection of revenue and the residents' ability pay for services to boost its coffers and implement the budget.
'This means that when we enter the new financial year in July, we will embark on an intensive campaign to encourage our residents to pay for services. For those who are poor and cannot afford to pay, we already have a programme in place — the Indigent Support Policy — where qualifying households are subsidised by government and are eligible to receive free basic services.'
They will achieve this by improving their cash collection through metering all unmetered properties, replacing old meters and conducting monthly readings to ensure accurate billing.
The city is also looking to build resilient infrastructure that can withstand natural disasters and wants to attract new investment to grow the economy and create jobs.
The budget was adopted when 134 councillors, mainly from the governing coalition of the ANC, EFF and IFP caucuses, voted for it against the 54 who voted against it while three councillors abstained.