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Proposed tariff increases have been published, and the City is seeking public comment before it approves any changes. Comment by 30 April.
PUBLIC comment is sought by the City on its newly proposed draft tariff increases, which were approved for public comment by the council on Thursday, 24 March.

WaterWater tariffs will increase by 14 percentThe public has been given until 30 April to make written submissions on the draft budget and the proposed tariff increases for the 2011/12 fiscal year. Written comments should be handed in at any of the City's customer service centres. Alternatively, check the City's website for more information.
Council spokesperson Virgil James says the City is yet to adopt tariff charges and assessment rates. This will only be done in May, after extensive public consultation. "The City has therefore followed the legal processes as required by the Municipal Finance Management Act."

The Municipal Systems Act requires all municipalities to review their tariffs annually and involve the public in deciding on amendments. The proposed increases have been made in line with the need for people to conserve resources. The annual tariff determination takes into account economic trends, user consumption, affordability and international best practices.

Gerald Dumas, the acting executive director of revenue in the City, says the public needs to know what the City's proposed tariffs and rates are, and they should be amended based on public comment before implementation.

Water
Tariff increases will be determined by consumption and heavy users will be penalised. Among the others, the City has proposed an average water tariff increase of 14 percent from 1 July.

James says this is based on input cost assumptions of a 12,1 percent increase in the cost of bulk water. Last year, there were no increases to the bills of consumers using below 7 000 litres of water a month. Large consumers were hardest hit. In terms of water and sanitation, tariffs rise according to each user's category.

Domestic, prepaid water and sanitation:

The first six kilolitres will be free;
Above 7kl to 10kl per month – 6,7 percent increase is proposed;
Above 10kl to 15kl per month – 8,7 percent increase is proposed;
Above 15kl to 20kl per month – 10,7 percent increase is proposed;
Above 20kl to 30kl per month – 12,7 percent increase is proposed;
Above 30kl to 40kl per month – 14 percent increase is proposed; and
Above 40kl per month – 14,5 percent increase is proposed.

ElectricityA prepayment electricity system will be introducedCommercial and industrial users:

Consumption up to 200kl – 14 percent increase;
Consumption exceeding 200kl – 15 percent increase; and
All other tariffs will be increased by 14 percent.

"There is still an urgent need for consumers to reassess their consumption of scarce natural resources and to make a contribution to the global initiatives on climate change," says Dumas.

He notes that the City has a social responsibility to provide its indigent residents with basic water and electricity at lower rates. As per the poverty index, it proposes that the allocation of free basic water for registered indigents in Band 1 be 25 litres per person per day, Band 2 be 35 litres per person per day, and Band 3 be 50 litres per person per day.

Band 1 is the lowest level of subsidy for those on the borderline of poverty, while Band 2 is aimed at those who earn a meagre income and their survival level is defined by the poverty index; Band 3 is the highest level of subsidy designed for those with no formal income.

Sanitation
The proposed domestic sanitation tariff increases are:

Erf size (m²)
 2010/11 Tariff (R/erf/month)
 2011/12 Tariff (R/erf/month)
 
Up to and including 300m²
 R75,61 up from R66,27
 R86,20 up from R75,61
 
From 301m² to 1 000m²
 R147,19 up from R129,00
 R167,80 up from R147,19
 
From 1 001m² to 2 000m²
 R222,68 up from R195,16
 R253,86 up from R222,68
 
Larger than 2 000m²
 R320,85 up from R281,20
 R365,77 up from R320,85
 

Electricity

James says the City has had a substantial increase in electricity input costs as a result of bulk purchase costs from Eskom and the decision by the National Energy Regulator of South Africa (Nersa) to hike rates. As a result, an overall increase of about 27,7 percent in electricity tariffs will be effective from 1 July.

The municipality will continue to help registered indigents by offering free basic electricity to each household each month. Lifeline users will have an increase of 8 percent, in line with Nersa's provision for low consumption customers, single phase and three phase users will have an increase of 16 percent, while the service charge increases by 13 percent.

James says that because of the drive to introduce a prepayment metering system, the tariff increase is kept at 5 percent for prepaid meters.

Agriculture users will have an increase of 30 percent;
Business users will have an increase of 31 percent; and
Large power users will have an increase of 29 percent.
Waste removal
Waste removal tariffs will be charged based on a property's value, with three different property value thresholds proposed. All properties valued above the threshold will face an increase of 6,7 percent, while business and higher-valued properties will face a 13 percent hike.

"Indigent households and all properties valued below the threshold of R150 000 will continue to receive free basic services," says James.

Description
 2010/11 (Current)
 2011/12
 Rand value increase
 % increase
 
From R150 001 to R300 000
 R73,00
 R77,89
 4,89
 6,7
 
From R300 001 to R500 000
 R85,00
 R90,70
 5,70
 6,7
 
From R500 001 to R700 000
 R97,00
 R103,50
 6,50
 6.7
 
From R700 001 to R1 500 000
 R128,00
 R136,58
 8,58
 6,7
 
More than R1 500 000
 R178,00
 R189,93
 11,93
 6,7
 
    

The City wants these increases for refuse collection to result in improved service quality for domestic round collections, improved cleanliness of public spaces and inner city areas, increased by-law enforcement and improved co-operation with stakeholders.

Rates
Rates and taxes are proposed to increase by 6,7 percent from 1 July. Proposed rates and taxes:

Category
 Proposed tariff 2011/2012 (cents in the rand)
 Percent increase
 
Agricultural holdings
 0,005258
 6,7 percent
 
Business
 0,018404
 6,7 percent
 
Business sectional title
 0,018404
 6,7 percent
 
Education
 0,001314
 6.7 percent
 
Public benefit
 0,001314
 6,7 percent
 
Farming land/property used for bona fide farming
 0,001314
 6,7 percent
 
Mining
 0,018404
 6,7 percent
 
Multiple purpose
 0,018404
 6,7 percent
 
Municipal not rateable
 0
 6,7 percent
 
Municipal rateable
 0,006310
 6,7 percent
 
Public service infrastructure
 0,001314
 6,7 percent
 
Religious
 0
 6,7 percent
 
Residential
 0,005258
 6,7 percent
 
Sectional title
 0,005258
 6,7 percent
 
State
 0,007887
 6,7 percent
 
Vacant
 0,021033
 6,7 percent
 
Residential property with consent use
 0,010516
 6,7 percent
 
Public service infrastructure privately owned
 0,001314
 6,7 percent
 
Private open spaces
 0,001314
 6,7 percent
 
  

"The City believes that the current tariff structure is fair and the intention is to support consumers in their efforts to adjust their consumption and utilise resources responsibly," says Dumas.

All residents, business, institutions and affected stakeholders of Joburg are invited to comment on the proposed tariffs for the 2011/12 fiscal year. Comments must be submitted by 30 April. Written submissions can be handed in at the City's customer service centres in all seven regions.

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