The Sandton ratepayers’ revolt is gaining momentum as 10 businesses take the local council to court, reports Ferial Haffajee
THE country’s most costly rates revolt in one of its richest municipalities – the Johannesburg suburb of Sandton – is now in its ninth month.
And the protest has found a new battleground in the past two weeks as captains of Sandton industry hauled the area’s local council, responsible for Sandton and surrounding suburbs, into Johannesburg’s High Court, charging that it had illegally levied millions of rands for redistribution to Johannesburg’s poorer areas such as Soweto and the sprawling townships of the West Rand.
Not so, says the council, pointing out that the revolt was premised on a fiction; rates were increased so that Sandton now pays exactly the same as others who live in Johannesburg.
And that’s 6,45c in a rand; up from 2,58c, which Sandtonites paid before the increase and before changes to local government. Court papers show these were the lowest rates among Johannesburg’s four councils.
“Sandton enjoyed an indirect subsidy to the rich. We’re not even talking about a progressive tax here,” says a council source.
Lawyers for the 10 businesses objecting to their rates increase also say the council did not have the power to raise a levy from ratepayers (both residential and business) and then to pass it on to Johannesburg’s poorer parts.
Legal mud-slinging aside though, the boycott is biting – the Sandton ratepayers’ federation, Sanfed, says its protest is costing the council about R25-million every month. Sandton is responsible for half the rates raised in Greater Johannesburg.
The protesters’ planning station is a small but well-equipped office in one of Sandton’s many shopping centres. The tools of struggle copied from the boycotters of old are everywhere: the hard-talking posters lining the walls, the constantly ringing phones, the well-used copying machine (to keep up the media propaganda war) and the stalwart who keeps it all together.
John Lambson has been involved in municipal affairs for longer than he can remember. Like others, he got a shock last year when the rates bill for the townhouse he lives in increased from R137 to R331 a month.
Negotiations with the hapless new councillors came to nought in a suburb where residents were accustomed to being listened to by the old council. “There was little or no consultation. Instead all we got was this comic budgeting,” says Lambson.
“Comic budgeting” in this case was a little new South Africa book-keeping. Johannesburg’s umbrella council, the Greater Johannesburg Metropolitan Council, transferred the surpluses raised in its more flush eastern council, including Sandton, which raised R438-million, and northern council (including Randburg) to others. There’s nothing unusual in that.
Gavin Lewis, the editor of The RDP Monitor says: “There is definitely a redistributive element in all metropolitan areas.”
What troubles local government consultant David Solomon more is the manner in which the increase was imposed. “Simply doing it that way is not accountable. It’s not acting in the public interest.”
The Sandton public reacted by either withholding their rates payments completely or paying the old amount with a reasonable increase added (in most cases, protesters paid 20% more).
Sanfed says that in the past two months, more people have started a full boycott, paying nothing at all. But most protesters still tear off the perforated ends of their green accounts, pay their old bill plus a bit and scrawl a note on their accounts to the council: “Payment for portion of rates bill only. I consider the full increase unreasonable.”
In August last year, 10 leading Sandton companies, including Liberty Life and Fedsure, stopped paying the increase and decided to take the council to court.
Now they’ve asked the court to throw out the local council’s budget. Critics say that business stands to save millions from its protest. They point out that Sandton’s lower rates was a factor in attracting the many businesses away from Johannesburg central.
The case also mirrors the urgent need for new ways of funding local government.
Lewis says councils’ ability to raise revenue is limited in the main to dog taxes, car licences and rates. He says this should be expanded to include a percentage of revenues raised per province. “The fund- raising powers of the provinces need to be redefined.”
The council’s coffers meanwhile get leaner and leaner. And while the huge plastic bowl marked “Fighting Fund” in Lambson’s office is empty for now, the boycott shows no sign of letting up.
This week the Sandton residents will chalk up another first as they become South Africa’s only protesting community to hit cyberspace with their own Web site.