The City of Johannesburg has announced its electricity, water and other rate increases which are set to take effect from 1 July 2022.
Presenting the city’s budget speech on Wednesday (25 May), the city’s mayoral committee member for finance Julie Suddaby said lower increases were requested for the poor and to encourage investment in the inner city.
“This requires area rezoning, which we will investigate in this fiscal year. We cannot give everyone everything they have asked for, but we believe that the tariff increases are reasonable and competitive. The rates that we have control over are increased within current inflationary targets. The current CPI is 5%.”
Suddaby said the hikes that will take effect include:
- Property rates will increase by 4.85%;
- Electricity will increase by 7.47%;
- Water will increase by 9.75%;
- Sanitation will increase by 9.75%;
- Refuse increases by 5%.
“To assist our residents we have adjusted our rebate structure for pensioners. Income levels for pensioners will be increased from the lower amount of R10,783 to R11,305 and the higher amount from R18,481 to R19,377. This amounts to an average increase of 4.85%.”
She added that the city was working to ensure that every rand spent on goods and services achieves market-related value for money.
“Residents are not averse to increased tariffs but would like to receive value for money. Sewer charges have been requested to be billed by usage as opposed to the current fixed charge. This requires a policy review and discussions with relevant stakeholders have been scheduled in June.”
While the electricity hike is well below last year’s 14.59% increase, analysts have warned that the jump will still put many South African households over the edge.
This figure constitutes a 3.49% increase for the 2022/23 year, and this is separate from the 9.6% annual increase for Eskom customers that kicked in on 1 April. The price hikes will take the average electricity tariff in South Africa from just over R1.33 per kWh to around R1.46, said Neil Roets, chief executive of Debt Rescue.
Roets said these increases impact South Africans from all walks of life and show no signs of slowing down.
“We all need power to keep our households and businesses running. We rely on electricity for everything we need to make life comfortable – and indeed possible – from running a hot bath to heating our food, not to mention the home entertainment that provides respite from the onslaught of spiralling living costs. There is no getting away from spending money to keep the lights on.” ”
Roets said these steady increases are a particularly bitter pill as the country faces continuous bouts of load shedding.
“Viewed in isolation, perhaps the burden of ever-increasing electricity prices might have been more easily absorbed had consumers not also had to contend with rising interest rates and skyrocketing fuel prices. Add to this the compounded effect on basic food prices, and there is no way to soften the blow.
“Low-income households spend a far larger proportion of their income on food, transport costs and basic housing, so inevitably they bear the brunt of this. There is no way to justify pushing people to the depths of despair.”