Setting aside parts of Cape Town’s controversial new municipal rates system will prove ”catastrophic”, the city’s legal counsel argued in the Cape High Court on Tuesday.
Ashley Binns-Ward, SC, argued against the Rates Action Group’s (RAG) challenge to the validity of the city’s sewerage and refuse charges, which are linked to the market value of a ratepayer’s property. The RAG is a voluntary body of ratepayer associations.
Binns-Ward argued that the system is an integral part of the city’s budget.
”[It is] not possible to set aside these provisions without effectively setting aside the budget,” he said.
Binns-Ward said the consequences will be ”quite chaotic”, particularly as the city’s 2003/04 budget cycle is nearing an end.
If the court set aside the provisions, it would mean the city has acted unlawfully for the past two years.
”This means the ratepayers would be able to recover all their money,” said Judge Essa Moosa with a smile.
Binns-Ward said the 2003/04 city budget is more than R10-billion, of which about R8,4-billion is used for operating costs.
He said a consequence for organisations such as the RAG would be that the new budget would possibly then have to address shortfalls in the previous budget, meaning that ratepayers would again carry the burden.
”One can’t get blood out of stone,” said Binns-Ward.
The RAG claims the city’s policy treats middle-class and upper-middle-class suburbs as ”cash cows to be milked at will” in the provision of municipal services, in effect amounting to an imposition of a ”wealth tax”.
In the second day of the trial, Binns-Ward argued that the Constitution places obligations on local government to upgrade infrastructure and provide basic services.
”A consequence of that … [is that] it has to be funded, which begs the question: where does the requisite funding come from?” Binns-Ward asked.
He suggested that this could be determined by national legislation.
The City of Cape Town’s 2004/05 budget will be tabled before council on Wednesday. — Sapa