Claim that water tariff hike will further ‘cripple’ residents, businesses

THE Good party says it is “disappointed” that water tariffs that “cripple“residents and businesses will further increase next year, despite rising debts in vulnerable households in Cape Town.

This follows the proposed annual budget for the 2021/22 financial year tabled to council by Mayor Dan Plato on Wednesday.

The party’s national policy officer, Mark Rountree, claimed the “grossly high” water charges and fixed tariff implemented in 2018 were approved by the DA caucus in spite of the objections raised by then-mayor Patricia de Lille and remain even though the drought ended years ago.

In a statement by De Lille on the party’s website titled “The truth about how the DA made billions from water tariffs”, she states that in December 2017, under the guidance of experts, she proposed a temporary drought levy charge to cover the predicted R1.6 billion funding shortfall that arose from reduced water use.

However the DA caucus “chose to reject the temporary drought levy, instead replacing it with a permanent pipe (connection) fee combined with ridiculously expensive water tariffs that rapidly raised the cost of water”.

Rountree claimed through these high charges, the City has made billions in profit raised by “grossly overcharging” residents and businesses for water.

“The further increases now being proposed for 2021/22 simply compound the already inflated drought surcharges. It is time to cut the costs for residents and stop this gross practice of raising billions in profits from water sales,” he said.

But the City refuted the allegations yesterday, saying there was no truth to the claim that it raised “billions in profits from water sales”.Mayco member for water and waste Xanthea Limberg said water tariffs have decreased compared to 2018 tariffs during the peak of the drought, adding that Council had approved the City’s “help and save” budget for the 2021/22 financial year, which includes a R3.4 billion allocation to help qualifying residents with rates and services relief.

“City water, including sanitation services, costs approximately 4c per litre compared with a litre of shop-bought bottled water of approximately R10 on average. The City does not plan for a profit/surplus on water income, and there is no truth to the allegation that the City raises ‘billions in profits from water sales’. The costs of water are kept as low as possible,” she said.

Limberg said the City’s water tariff, like many municipalities, has a usage and a fixed part and it forms the total water tariff that covers the cost of providing the water service.

“This includes the maintenance of infrastructure and making sure Cape Town is resilient for future shocks by adding new sources to its water supply and becoming a water-sensitive city.’

“The fixed component of the tariff covers approximately 20% to 25% of the water service costs. If this was dropped, the consumptive tariff would have to be increased to compensate. The fixed part helps to contribute a stable income, because water provision needs to be paid for, whether water usage goes up or down, as experienced during the drought.’’