GOOD Statement by Lloyd Phillips,
GOOD Councillor & Chair of Chairs in The City of Johannesburg
14 June 2023
GOOD is hopeful that the R80,9 billion City of Joburg budget will start to resolve the long-standing issues of infrastructure decay across all service interfacing Municipal Owned Entities but disagrees that rate payers should suffer hefty increases to recoup from the major revenue losses.
The Member of the Mayoral Committee responsible for Finance Dada Morero tabled the 2023/24 budget. The city’s operational expenditure sits at R73.3 billion, while capital expenditure stands at R7.6 billion for the 2023/24 financial year, with a three-year capital budget of R24.4 billion.
GOOD has been calling for a sharp focus on the revitalization of revenue generating MOEs such as City Power and Joburg Water infrastructures in a bid to ensure improved levels of service delivery but also to finally put a stop on perpetual revenue loss. The ripple effect of the loss revenue both through aged infrastructure and poor management has plunged the city into a financial quagmire.
However, we are concerned that the city is now making residents suffer to make up for their revenue collection failures. We are unsettled by the electricity increase of 14,97 percent and water tariff and sanitation tariff will hike at 9,3 percent respectively. MMC Morero also added that the refuse tariff will increase by 7 percent. GOOD believes there are other revenue generating avenues that should be explored first before placing the burden on the rate payers who are already battling economic hardships.
While we note the property rates increase of two percent, we commend the introduction of sliding scale on pension rebates which will provide much reprieve. MMC Morero announced that the first R1.5 million of the property value (inclusive of the residential threshold value) for pensioners between the ages of 60 – 69 will be exempted from rating. Furthermore, the first R2 million of the property values including the residential threshold value for pensioners aged 70 and above will be exempted from the rating. The new provision will see all qualifying pensioners receiving the rebate and paying on the balance of values that exceed the mentioned thresholds.
It should not come as a shock to the residents of Johannesburg that the city is cash strapped and unable to meet the R4,3 billion required monthly to run its operations. We have been highlighting revenue collection failures for a long time and the need to derive more avenues to generate revenue.
GOOD would like a clearer commitment with timelines on when the city intends to revise City Power’s business plan. It is not financially sustainable with an overdraft of R9 billion. In fact, many of Joburg’s entities which are battling to stay afloat must undergo rigorous review, allocating money to entities without ensuring sound financial management will be working backward.
The R4.3 billion allocated to City Power to carryout various infrastructure projects and the R23,7 billion for street light repair and maintenance is a step in the right direction.
However, GOOD is concerned that once again there is no detail on measures the city intends to implement to stop infrastructure vandalism. It would not serve the city if this was merely lip service. Many communities currently endure long hours without electricity because of theft and vandalism.
We also note and welcome the R3.1 billion multi-year capital budget earmarked for water and sewer pipe replacement, upgrades, and maintenance. Many areas especially in Joburg South are in dire need of sewerage upgrades.
The Johannesburg Roads Agency (JRA)’s allocation of a three-year capital budget of R2.5 billion and an operating budget of R1.5 billion for is much welcome; and the R455 million for road rehabilitation and resurfacing. GOOD has long called for the resurfacing of Joburg’s 13 999km of road network.
Renewables
We support the city for the foresight and preparing for an energy mix with a move toward renewable energy. However, we disagree with the Mayor that this should wait until current entities are stable first.
Given the long lead time it will take to award the tender and to get the power supply connected to the grid, the city should start immediately to prepare a tender for renewable energy from IPP’s.
There is no reason for this not to happen concurrently while the city stabilizes the current entities.
Vulnerable citizens
The budget is completely silent on programs meant to advance the lives of people with disabilities. The budget of R359 million for social development is not nearly enough as it must be split among programs for youth, LGBTQIA+ communities and many other competing priorities.
The approved City Policy of 2021 on people with disabilities has placed a responsibility on all city departments to attend to issues such as ensuring that facilities are easily accessible to persons with disabilities. It also implores the city to create opportunities for such persons to participate in the economy of the city rather than being relegated to receivers of grants.
GOOD has through its position in the legislature held dialogues to shine the spotlight on this plight. The consensus arising from the dialogues is that funds allocated to improving the lives of persons with disabilities is not enough.
We will continue to explore other means within the GLU to raise this concern.
Media Enquiries:
Lloyd Phillips, GOOD Councillor & Chair of Chairs in The City of Johannesburg
Cell: 074 731 7578
Email: lloydp04@gmail.com
Janke Tolmay, GOOD Media Manager
Cell: 073 367 1223
Email: janke@forgood.org.za