Tariffs

The City annually reviews its tariffs to ascertain whether they are still capable of producing the required revenue envelope, taking into account a number of internal and external factors. The City’s tariff policy is cognisant of financial sustainability and social factors in ensuring that proposed tariffs are not only cost-reflective but also consider affordability of services, particularly for the most vulnerable households within the context of the macro-economic environment.

“Consumers themselves can take steps within their own households to reduce their monthly bills. Information on practical measures to lower consumption is already widely available from City Power, Joburg Water and Eskom and we will continue to communicate this to households and businesses,” said Makhubo. 

The proposed tariffs for key services for the 2015/16 are as follows: 

Property rates

Property rates increase by 6%, which is within the South African Reserve Bank inflation target range. All property ratio categories are maintained in relation to the residential category. Sectional title rebate is reduced to 10%. Pensioner rebate is maintained with the pensioner income reviewed in line with inflation. Illegal use tariff is increased by inflation and all other rebates have remained unchanged.

Electricity

The proposed average tariff increase for electricity is 12.19%, in line with the National Energy Regulator/Eskom proposed tariff increase. The City applies a stepped tariff structure for electricity services. “The message we want to convey to our residents is: the less electricity consumers use, the less they pay,” said Makhubo.

Water, Sewerage and Sanitation Services

The proposed tariff increase for water, sewerage and sanitation is 14% for the 2015/16 financial year. This is largely a pass-through cost and is determined by the need to ensure the conservation of this scarce natural resource. It also includes the cost of maintenance and renewal of purification plants, water networks and reticulation expansion.

Waste Removal Services

The City will increase refuse removal services by 8% for all customers. These proposed tariffs are cost-reflective to ensure adequate funding of Pikitup’s operations. 

Rebates and relief

Certain aspects of the tariffs and rebates are designed to provide relief for Johannesburg residents. The first R200 000 of the value of all residential property is exempted from rating. 

Pensioners with a gross monthly income of less than R7 850 get 100% rebates on property rates, while those with an income higher than R7 850 but less than R13 457 qualify for a 50% rebate. Pensioners older than 70 years who own a house worth R2-million or less receive a 100% rebate on property rates. Child-headed households with property value not exceeding R2-million receive a 100% rebate on property rates. 

All households within the city receive 6kl free water every month. A subsidised water tariff structure is in place for those on prepaid meters. A subsidised sanitation and sewerage tariff structure is applicable for those on prepaid meters. Residential properties valued at less than R200 000 receive free refuse removal service. 

The Extended Social Package (ESP) assists poverty-stricken and vulnerable households and individuals. About 124 477 beneficiaries are currently registered on the ESP. Varying subsidy packages are provided, depending on a household’s score on the CoJ Poverty Index.