{"id":829896,"date":"2025-06-30T11:30:00","date_gmt":"2025-06-30T09:30:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=829896"},"modified":"2025-06-30T11:31:12","modified_gmt":"2025-06-30T09:31:12","slug":"major-pain-hitting-south-african-households-this-week","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/829896\/major-pain-hitting-south-african-households-this-week\/","title":{"rendered":"Major pain hitting South African households this week"},"content":{"rendered":"\n

South African households will be hit by significant rate hikes this week, with electricity prices leading the charge for the incoming pain.<\/p>\n\n\n\n

Tuesday (1 July) marks the start of the municipal financial year in South Africa and will see local hikes to rates and taxes kick in.<\/p>\n\n\n\n

Households in major metros across the country will see increases to monthly rates for electricity, water, sanitation, refuse removal and property rates.<\/p>\n\n\n\n

Local councils have been debating and voting for increases as part of their budget process, and despite pushback and a few changes here and there, rate hikes are largely set.<\/p>\n\n\n\n

South Africans can expect above-inflation hikes this year as cities continue to operate under strained conditions. <\/p>\n\n\n\n

City of Joburg, for example, will be increasing its water and sanitation charge by 13.9% from Tuesday, which is even higher than the already-burdensome 12.7% increase to electricity charges.<\/p>\n\n\n\n

Despite the steep increases, the city is still sitting with a maintenance backlog of over R200 billion, which remains unfunded, meaning the bill pain is unlikely to make a dent.<\/p>\n\n\n\n

By contrast, the City of Cape Town has much lower rate hikes coming\u2014but the burden of financing the budget will come at the cost of the wealthier and higher-income brackets.<\/p>\n\n\n\n

The City of Tshwane’s budget included similar fee increase trends, with double-digit hikes for electricity and water.<\/p>\n\n\n\n

However, the city’s budget also introduced a new R194 per month city cleaning charge, which will add even more pressure to households.<\/p>\n\n\n\n

While other cities, like Cape Town, have city cleaning fees, these are attached to the value of the property. Tshwane’s will differ by charging a flat rate of R194 to any households that does not have a city waste account.<\/p>\n\n\n\n

Also, contrasting other metros, Tshwane’s property rates should be declining by about 4% to account for the higher property valuations on the roll.<\/p>\n\n\n\n

The table below outlines the rate hikes tabled for the major metros.<\/p>\n\n\n\n

Rate<\/strong><\/td>Joburg<\/a><\/strong><\/td>Cape Town<\/a><\/strong><\/td>eThekwini<\/strong><\/td>Tshwane<\/strong><\/td><\/tr>
Electricity<\/td>12.7%<\/td>7.2%<\/td>12.7%<\/td>10.2%<\/td><\/tr>
Water and Sanitation<\/td>13.9%<\/td>4.5%<\/td>12.9%<\/td>13.0%<\/td><\/tr>
Refuse removal<\/td>6.6%<\/td>7.4%<\/td>7.0%<\/td>4.6%<\/td><\/tr>
Property rates <\/td>4.6%<\/td>8.0%<\/td>6.5%<\/td>-4.0%<\/td><\/tr><\/tbody><\/table><\/div><\/figure>\n\n\n\n

Electricity increases will be worse than you expect<\/h2>\n\n\n\n

Along with the electricity price hikes across the metros, households are likely to see their electricity bills come in much higher than the stated increases.<\/p>\n\n\n\n

The announced electricity hikes are an average increase across all households. The increase reflected on individual bills will differ, depending on consumption.<\/p>\n\n\n\n

This is because national power utility Eskom has implemented new fee structures under its retail tariff plan (RTP) that carry various capacity, network and service charges.<\/p>\n\n\n\n

The RTP became partially effective (20%) on 1 April 2025, and will be full phased in by 2027\/28.<\/p>\n\n\n\n

Under the RTP, a final Eskom bill is influenced by various charges and fees:<\/p>\n\n\n\n