Outcry over tariffs

“The focus should not be on home value and status, but tariffs must be based on usage alone”

SEVERAL petitions which had garnered huge support have been started by city residents in a bid to fight high electricity tariffs.

The 13.5% electricity tariff hike took effect on July 1 and has caused widespread outrage with residents bemoaning the increase amid a pandemic, with job losses at an all-time high.

Founder of the group Electricity Tariffs Must Fall, Natasha Selbourne, said electricity should be treated as a basic right and be made affordable to residents as it was an everyday necessity. She said no unfair conditions should be attached to it.

“The lifeline tariff, which was created for the ’poor’ is R1.43, but if you cross the 350 unit tariff cut-off, you automatically pay more than double a unit. These people have more than one family member within their homes and this should be taken into consideration.

“The focus should not be on home value and status, but tariffs must be based on usage alone,” she said.

Mitchells Plain resident Ghowa Benjamin Galiem, a breadwinner, said making a choice between electricity and food with the increasing prices of petrol, rates, electricity and just basic daily needs was not an easy decision.

She said her salary only covered her bills as salaries were not increasing while everything else was.

Sandra Dickson from STOP COCT said they had been inundated with complaints from angry Capetonians after purchasing their first electricity units following last month’s increase.

“STOP COCT had been warning the City for many years that their tariff setting policies, above inflation, is not sustainable. Even Covid-19 could not make the City budge and change their approach, but persists with their stubborn approach and doing business as usual for the past two budget cycles.

“The City's budget is forever growing and is funded via tariff increases while the public is losing jobs and taking pay cuts,” she said.

Dickson said the City’s claim that it applied “only” a 13.5% tariff increase for electricity was disingenuous as only 65% of its costs were due to bulk purchases from Eskom, which entailed a 17.8% increase.

“If balanced against the 35% of costs, 13.5% is still passing the entire Eskom increase, as is, to us.

“The City did have the lowest increases if measured as a percentage, but in real money terms, the City's electricity tariffs are substantially higher than Tshwane, Johannesburg and Durban,” she said.

Dickson said the City had no empathy with those struggling to pay municipal bills with its debt collection via prepaid electricity meters for accounts in arrears for rates, water and other services.

Dickson said this stripped households of the dignity to purchase a basic necessity such as electricity.

“This means that a person whose municipal account fell into arrears buys R10 prepaid electricity; he may get only R1 in electricity units, and R9 is taken by the City towards his debt,” she said.

Mayoral Committee member for finance Ian Neilson said the City's rates were competitive against other metros and the tariff increases for electricity were the lowest of the metros in South Africa.

He said the City had absorbed more of the massive Eskom increase than any other metro.

“The large increases are driven by Eskom, although the City has managed to absorb part of the 17,8% Eskom increase to provide some respite to our customers. It is impossible to absorb the full extent of such massive increases, although the City has done its best,” he said.

Neilson said all debt management was done on a case-by-case basis with prior notification and warning to the debtor.

“Debtors are also made aware of the assistance offered by the City if they are struggling to pay. It is up to the debtor to approach the City to see if they qualify for assistance.

“Since the start of the Covid-19 lockdowns in March 2020, the City has consistently asked customers to be proactive and to apply to see if they qualify for rates and services relief or if they have been severely impacted by the Covid-19 lockdowns,” he said.