City of Cape Town Link

City to open supplementary public participation on Budget 2026/27 amendments

<p>The City of Cape Town will publish amendments to its tabled Budget 2026/27 for public comment following the Western Cape High Court’s ruling on tariff structures. The main impact of the judgment is to limit the ability of the City - and all municipalities - to cross-subsidise to protect lower- and middle- income households. The amendments represent the City’s proposed efforts to continue offering this protection within the framework of the ruling.</p>

<p>‘A key impact of this court ruling is what we’ve warned all along: that water and sanitation fixed charges will go up for many families in lower- and middle-value residential properties, and go down for higher-value properties. <br> <br>‘We have done our utmost to mitigate this effect. To protect lower- and middle- income households from the impact of this court ruling, we propose a further raising of the rates-free rebate to the first R620 000 of property value, up from R450 000, for residential properties under R8m. All indigent benefits will also apply up to R620 000 residential property value.<br> <br>‘This will reduce property rates for many households in the lower- and middle- value bands to mitigate the rise in fixed water and sanitation charges they will face because of the court ruling.<br> <br>‘While we adjust for the impact of this ruling, we remain concerned about its implications for the ability of municipalities to equitably cross-subsidise in utility tariffs in the South African social context. We will engage the National Treasury and Co-operative Governance departments nationally to seek regulatory clarity on available options for municipalities to equitably cross-subsidise lower- and middle-income households.<br> <br>‘It remains my firm belief that Cape Town cannot truly work unless it works for everyone. For this reason, we do not propose any cuts to Cape Town’s essential infrastructure projects, like pipe replacements, better sanitation and public transport. To cut these projects, as has been suggested by some, would lead to a less functional city and less basic dignity for residents. It would be a terrible and indefensible action. These are precisely the investments that make Cape Town the most functional city in the country,’ said Mayor Geordin Hill-Lewis.<br> <br>Proposed amendments to be published for comment in a supplementary public participation process from 27 May to 10 June 2026 include:<br> </p><ul><li><div style="text-align:left;"><strong>City-wide cleaning costs move back into property rates:</strong> This will remove the city-wide cleaning charge as a standalone item on bills, and increase property rates for residential customers – changing the -10,2% reduction tabled in March. Commercial property rates will also increase while electricity unit costs will reduce due to the phased-reduction of the surcharge contribution to city-wide cleaning. Residential electricity tariffs remain unchanged as these customers no longer contribute to city-wide cleaning in this way.</div></li></ul><ul><li><div style="text-align:left;"><strong>Fixed Water and Sanitation charges revert to water meter connection size: </strong>This was the method before the use of property value bands. This impact of the court ruling means that higher value properties will pay less fixed charges while lower value properties will pay more than they do currently. The City has tried to buffer this impact by consolidating the fixed tariff charged for all meter sizes up to 22mm, and shifting costs to higher consumption users compared to the March tabled budget.</div></li></ul><ul><li><div style="text-align:left;"><strong>Protection for households: </strong>To protect especially lower- and middle- income households from the changes to fixed charges, the City will further raise the indigent relief qualifying threshold and rates-free benefit. All residential properties up to R8m will now get the first R620 000 rates-free, up from R450 000 in 2025/26. Indigent benefits apply for all properties under the new R620 000 threshold.</div></li></ul><p> <br>The full details of proposed changes necessary to secure certainty for the new budget following the court ruling will be published on 27 May for public comment until 10 June 2026. These include: </p><ul><li><div style="text-align:left;">the rate-in-rand, </div></li><li><div style="text-align:left;">rates ratio; and</div></li><li><div style="text-align:left;">tariffs for water and sanitation</div></li></ul><p>This will allow the City sufficient time to adopt a budget before the financial year begins on 1 July 2026, as required by law.<br> <br>The impact of the ruling does not affect the expenditure aspects of the tabled budget and no new comment is invited in that regard.<br> <br>The ruling’s effect is also only prospective and applicable from 1 July onwards.<br> <br>All revenue raised in 2025/26 has gone to the intended purpose of infrastructure and service delivery. It is important to further note that the ruling does not take issue with the necessity of these funds to run the city. Ratepayers will now contribute to these same running costs but in a different way based on the new proposals for 2026/27.<br> <br>Throughout the court process, the applicants SAPOA and Afriforum acknowledged that Cape Town is a well-run metro and accepted the necessity of the City’s infrastructure budget.<br> <br>Given the Court’s rejection of property-value bands as a means of achieving cross subsidisation for funding services, the City will begin a process of engaging the National Treasury. </p><p>This will focus on other available means to secure cross-subsidisation going forward, especially in relation to National Treasury’s metro trading services reform initiative and the White Paper on Local Government.</p><p><strong>End</strong><br> <br></p>

2026-05-21T22:00:00Z

GP0|#1d539e44-7c8c-4646-887d-386dc1d95d70;L0|#01d539e44-7c8c-4646-887d-386dc1d95d70|City news;GTSet|#62efe227-07aa-45e7-944c-ceebacca891d

Cape Town’s Integrated Development Plan (IDP) 2017 - 2022

An overview of the City’s Integrated Development Plan (IDP).

Heritage information and resources

Our well-maintained heritage database and preserved heritage records are available to the public in a number of ways.

Walking heritage tours of the city

Tips and resources for you to walk and explore our beautiful city and its unique natural and cultural heritage.

Keep our public places clean

The City provides a number of public cleaning services that you can contact to help keep our public places clean.