City proposes social package of R4,3 billion to help residents

06 April 2023

The City’s ‘Building Hope’ Budget is out for public comment and it proposes a social relief package of R4,3 billion to help residents and ratepayers in the new financial year. This is approximately R500 million more than the allocation in the current financial year. 

'With the rising costs, including Eskom's price hikes and the lingering economic impact on residents from the Covid-19 pandemic and lockdown, the City has investigated absolutely every avenue to buffer residents where possible.

'We have done our best to keep affordability front of mind while not risking the delivery of services while investing in Cape Town's future. As such, we have proposed a record R11bn capital budget proposed for the 2023/24 financial year.

'Over the next decade, some R120 billion in infrastructure investment is foreseen to build a resilient City of Hope that is well-positioned to weather the shocks of the future while also unlocking more meaningful economic growth. We urge members of the public to comment on this Building Hope budget until 5 May 2023,' said the City's Mayoral Committee Member for Finance, Councillor Siskeko Mbandezi.

Proposed relief highlights:

• R4,3bn social package: up from R3,75bn in 22/23, with R1,96bn in rates rebates and R2,37bn in indigent relief.
• 50% rates relief increase: proposed for all residential properties of R5 million and under, with the first R450 000 of property value now rates-free. Over 700 000 properties foreseen benefit, representing 80% of all properties in our city.
• More pensioners and social grant recipients will benefit from rates rebates: by raising the upper qualifying limit from R17 500 to R22 000 total monthly household income.
• 192 500 properties valued at R450 000 or below, or household income below R7 500, will receive these monthly benefits:

• 100% rebate for property rates and refuse removal
• 15kl free water and 10,5kl free sanitation
• Up to 60 free electricity units

• Lifeline tariff changes: customers consuming more than 350 units would pay R3,71 per unit, but with changes to the Lifeline tariff structure, will now pay R1,84. Lifeline customers do however still need to be mindful that the Block 1 threshold was raised to 600 units to allow people to use more during winter months, and that an average monthly consumption limit of 450 units still applies over a 12-month period to remain in this tariff category.

'The City has been able to reduce Eskom's 18,49% increase to 17,6%. This approximately 1 % reduction amounts to some R100 million per month that the City is absorbing while still funding a reliable electricity service and plans to end the City's sole reliance on Eskom's expensive power as soon as possible. If the City were to absorb the entire tariff increase, it would amount to more than R2 billion per month. The City, and its ratepayers, simply cannot afford this.

'About 70% of the City's tariff income goes toward buying bulk electricity from Eskom, the biggest cost driver, with the remaining 30% invested back into service delivery and ending load-shedding,' said Councillor Mbandezi.

To view the Tabled Budget please visit the draft budget or go to your nearest subcouncil office or library for a copy of the budget.

View the subcouncil public meeting schedule here.

Written comments

By email: Budget.Comments@capetown.gov.za

Through your Ward Councillor/Subcouncil offices:

Verbal inputs

Phone: 0800 212 176

For assistance to comment in English, Afrikaans or isiXhosa, please phone 0800 212 176

Visit www.capetown.gov.za/HaveYourSay for more information.

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Published by:
City of Cape Town, Media Office