Mayor Hill-Lewis Council Speech: City of Hope Budget amendments
27 May 2026
Mayor Hill-Lewis Council Speech: City of Hope Budget amendments
Madam Speaker,
Fellow Councillors,
Colleagues in Team Cape Town
I begin by paying my respects to Councillor Bulelani Yeko of the EFF who tragically passed away, along with another EFF member, in a car accident earlier this month.
Three passengers in the car survived, and we wish them a full and speedy recovery.
To Councillor Yeko’s family, friends and colleagues in the EFF, on behalf of the City I extend our deepest condolences. May you find strength and comfort, and may his memory always be a blessing.
I ask that we observe a moment’s silence in honour of Councillor Yeko.
Thank you.
Speaker,
I have been growing more gravely concerned about the escalating xenophobic rhetoric in our country, and a number of incidents of low-level looting, intimidation and destruction of property.
These sentiments and actions are being actively stoked by the language of a few politicians in our country who are trying to do out-do each other in their thinly veiled hatred and scapegoating.
The grass is very dry in this country, and yet these politicians are actively going around flicking matches. Soon, one of them could catch on, and when it does, history will record clearly who is responsible.
South Africa’s Constitution enjoins each of us to a set of values that bind us together as South Africans, and which capture our history of being able to heal division and hatred peacefully. Our national values of tolerance in diversity, generosity of spirit, and commitment to the rule of law are needed now more than ever.
In Cape Town, we are trying to build a society based on the rule of law. In that mission we face profound difficulties, broken state institutions crushed by years of bad government, and well-organised criminal adversaries.
Those state institutions must be rebuilt, brick by brick, and the law must be enforced for one and all.
And while we rebuild the state, fix institutions, and enforce the law, let us always do so by standing up for our fundamental values, and let us say loudly that we will not tolerate or give any succour to those spreading hate and scapegoating one group, or encouraging vigilantism and mobs.
Being the City of Hope means leading with our values always, and to those spreading hate and stoking violence, we see you, and you will be held accountable for what you are doing.
Colleagues, before we move onto the main business in Council this morning – the tabling of amendments to our Budget – I would like to say a few words on the inspirational work carried out by all the City’s response teams during and after the recent devastating storm and flooding.
The strong winds and heavy rainfall caused much disruption and damage right across the metro – not a single neighbourhood was spared, and our response teams had to attend to emergencies in many places, all at once.
This required meticulous coordination and planning, and it also required an incredible effort and long exhausting hours from many City employees.
From the clearing of floodwater and drains, to the cutting down and removal of fallen trees, the fixing of roads, the restoration of thousands of electricity faults, the assistance of thousands of families left homeless and cold, and many other tasks that all had to happen at once, our colleagues in Team Cape Town were simply amazing.
I was inundated with messages of praise for the way in which they responded to the challenges and often worked in extremely tough and dangerous conditions to help people get back to a sense of normality.
A storm like that doesn’t come around often, but when it does, it really tests the character and courage of the men and women tasked with dealing with its impact. And our colleagues passed that test with flying colours.
On behalf of the City of Cape Town and our residents, I offer my gratitude and deep appreciation. Cape Town is proud of you.
Madam Speaker,
Two months ago, we tabled our draft budget for 2026/27 – what we call our City of Hope Budget, as we make our boldest statement yet in building the benchmark South African city, and the one city where every resident has reason to believe in a better future.
It is a budget in which we continue our record-setting infrastructure investment because we want Cape Town to work better for everyone.
That is why we are so focused on adequate infrastructure investment. Not to break records for the sake of it, but because we know that every Rand invested in better basic infrastructure, has a direct consequence for better basic services and more dignity for all.
We also want to prepare Cape Town for the rapid growth we’re already seeing here, protecting her against the pressure that comes with that, and laying the foundation for the kind of growing economy that will help lift many thousands more out of poverty and into work.
And while the infrastructure investments contained in the budget absolutely dwarf those of any other city in South Africa, the reality is that this is the bare minimum needed to deliver a city that works for all and get our city ahead of the population pressure curve.
The collapse and decay that we see in all the other major cities in South Africa is a direct result of not meeting this minimum level of required investment in new infrastructure, not maintaining existing infrastructure, and letting that backlog grow bigger and bigger.
Once you fall behind like that, it is very, very difficult to catch up, and that is why the situation in a city like Johannesburg is so dire right now. It will take an incredible effort of financial discipline and careful prioritisation to right the ship there.
Thankfully Joburg’s residents have an opportunity – perhaps their last opportunity – to choose a local government in November that is able to do that for them. But they should never have been put in that situation to begin with.
We made a solemn vow that Cape Town would never follow that path, and that we would do whatever it takes to ensure that our city both remains the most functional city in the country, and that it is a better place to live for every resident.
Balancing critical infrastructure investment with the realities of constrained revenue, and the pressures felt by our ratepayers, is one of the hardest jobs in the City.
Madam Speaker,
As we know, the use of property values to determine fixed tariffs has now been ruled impermissible by the court.
We warned all along that the only inevitable outcome of undoing this method of cross-subsidisation would be that lower value homes would be left paying higher fixed tariffs, while the highest value homes in the city would pay lower fixed tariffs.
I am genuinely amazed that some of the parties who joined that case seem taken by surprise.
So, over the last weeks we have worked to find a way to respect the Court’s ruling, while still trying to protect lower and middle income families from its impact, and keep all our city’s critical capital projects intact and on track.
Last week I spent some time visiting infrastructure projects in Hanover Park, Gugs, Manenberg and Philippi. Driving around, one thing struck me more than anything else: everywhere I looked, the City is building something.
I saw workers resurfacing roads in Gugs, I saw hundreds of workers hard at work on the MyCiti lanes, I saw people working on a housing project just paving the sidewalk to finish the last details, I saw pipes piled high waiting to go in the ground.
When you travel around Cape Town today, you will see infrastructure projects happening everywhere. The whole city, from corner to corner, is seeing construction projects underway – it is happening and visible everywhere.
Let me be very clear that not one single infrastructure project in the City is optional, and that cutting these investments is not something we will ever do.
Whether it is pipe replacement across our water and sewer network, the massive upgrades to our wastewater treatment works, the new Cape Flats MyCiti route across the south-east to Khayelitsha and Mitchells Plain, critical investments to our electricity grid, informal settlements upgrade programmes, or any of the hundreds of projects to improve public amenities, roads, waterways and public spaces – each and every one of them is vital to Cape Town’s future.
We will not listen to the demands of one party in particular in this Council to cut our capital budget for basic services infrastructure. We will not heed this call because we are committed to seeing Cape Town succeed for all.
We want to continue being that beacon of hope – our country’s one city that works. A city of hope for all that shows the rest of South Africa that progress is possible, and the vision of our constitution can be realised.
So the infrastructure investments in our budget will remain protected.
Despite the limits we now face on the ability of the City – and all other municipalities – to cross-subsidise to protect lower- and middle- income households, the amendments to the budget that we release for public comment today represent the City’s proposed efforts to continue offering this protection within the framework of the ruling.
We remain concerned about the implications of the ruling to sustainably cross-subsidise utility services in the South African social context, and we will be engaging National Treasury and Cogta for guidance on our available options to do this going forward.
However we must now deal with the impact of this ruling as best we can before the start of the financial year on 1 July.
We have therefore spent a great deal of time and effort these past weeks to adjust our budget for the impact of this ruling, and to offer a revised budget that continues to protect lower- and middle-income households.
Those are the amendments we table today for public comment, so that we may adopt a final budget before 1 July.
Before I set out some of the details of these amendments, I would like to briefly reflect on the impact of this judgment – not just for Cape Town, but for all municipalities grappling with the issue of cross-subsidising services.
The net result of the court ruling is something we warned against all along: Decoupling the fixed charges in water and sanitation from property values will limit the ability to cross-subsidise, and will see those charges go up for poorer families, and come down for wealthier families.
Among the most vocal crusaders for this was the GOOD party, who joined the court process. Forgetting all about their pro-poor pretence, they didn’t hesitate to advocate against greater protections for lower- and middle-income families.
Only once the ruling was in, and the effects on fixed charges were clear, did their statements suddenly start pivoting towards protecting the poor. That belated damage control spin fools no one.
It is even more ironic when you consider the views on fixed charges linked to property value expressed a few years ago under then Mayor Patricia de Lille. This quote is taken from one of her statements back in 2018, when they first proposed a drought charge:
“A charge based on property valuations has been deemed the most progressive of the options, while being the most equitable and fair to poor households.
This is the fairest way to recover the City’s revenue shortfall by distributing the charge in such a way that those who can afford it will pay an amount based on their properties’ valuation.”
What a U-turn! That’s a U-turn that would make any Cape Town taxi driver proud.
But it gets even worse.
GOOD’s solution was to suggest that we cut our infrastructure budget.
So not only did they work to raise fixed charges for lower-income households, they also now want us to cut our pro-poor infrastructure spending.
I’m very keen to know which budget items they want us to cut, because they weren’t clear on this.
Cllr Dickson made one demand, that we should cut the entire MyCiti Cape Flats expansion project to Khayelitsha and Mitchells Plain.
She says that no one asked them if “they wanted it”.
She doesn’t say who “they” are, but let me help her: “they” are the residents of Cape Town who live Lansdowne, Hanover Park, Gugs, Nyanga, Philippi, Crossroads, Browns Farm, Khayelitsha and the whole of Mitchells Plain, and who currently wake up long before sunrise to spend hours on the road getting to work.
They do this because the rail system is still only crawling back to life after it was run into the ground, and the only other public transport is all road based that travels in the normal traffic.
The MyCiti will save them money, and save them hours each way that they can better spend with their family.
I doubt Mrs Dickson has asked the “them” she insultingly refers to whether they want the project cut. But, I will be sure to convey her message.
One person she really should tell though is her own party boss, Mr Herron. He spoke passionately last week about how badly needed the MyCiti Cape Flats extension is, and how cancelling it would “strangle…the city”.
For once, he and I agree.
So, not only has GOOD done a U-turn on their position on fixed charges, they’re also contradicting each other on public transport investment.
So, assuming they work out among themselves whether they actually support better public transport for the people of the Cape Flats or not, the question remains: what are the big infrastructure cuts they insist we must make?
Must we cut our sewer and water pipe replacement programme?
Must we cut our pothole repairs and road upgrades?
Must we stop the country’s largest sewer upgrade, currently happening on the Cape Flats?
Must we cut our safety and security investments?
Must we halt our electricity grid upgrades?
Must we freeze our sports facility upgrades in lower-income communities, or disinvest in libraries, fire stations, clinics, parks, and public spaces?
Of course they won’t say.
Just as they won’t explain how their anti-poor stance miraculously morphed into pro-poor sympathy afterwards.
We on the other hand, care deeply about serving all Capetonians, to make this city better for everyone, to keep it the country’s best city, and to shield its vulnerable residents.
The budget amendments we’re publishing today represents the next best way for us to balance those things within our available resources.
Madam Speaker
I will now briefly set out what has changed through these amendments to bring them in line with the court ruling.
In short, there are three main changes to the budget:
- The first is that the city-wide cleaning charge has been removed as a stand-alone item on the bill and has been moved back into property rates.
- The second is that the fixed charge portion of the water and sanitation bill will no longer be coupled to property value, but will revert back to the water meter size.
- And the third is that we’ve raised the threshold for property rates rebates and indigent relief in order to shield more households from any increases that may have arisen from the first two changes.
Moving city-wide cleaning costs back into property rates means that we can no longer offer the rate-in-rand reduction of -10.2%, as tabled in the original draft budget.
For residential properties, that reduction will now be -2%.
Commercial property rates will also increase compared to the March budget, while commercial 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.
Decoupling the water and sanitation fixed charge from property value bands and coupling it once more to a property’s water meter size takes us back to the system that was in place previously.
Following the court ruling, higher value properties will now pay less in fixed charges and lower value properties will pay more.
In an effort to ensure protection against these changes, we are proposing the following measures:
- a lower overall fixed charges portion of the tariff
- shifting costs to higher consumption users, through increases to the step-tariff for usage over 10.5kl.
- and a consolidation of the most common water meter sizes – those under 22mm – into one charge category
This will go some way towards mitigating the impact of the court ruling on lower- and middle-income households.
But still, if we stopped there and did not act further, then poorer households in Cape Town would be worse off than before the court ruling, thanks to these changes to water and sanitation charges.
So, to help protect those families, we are proposing to raise property rates rebates and indigent relief.
We are now proposing a raise of the rates-free threshold to the first R620,000 of property value – up from R450 000 now.
This means that all homes up to R8 million will get the first R620,000 rates free.
The impact of this protection is proportionally greater for lower-income homes. In fact, all properties under R1.8m in value will see an actual decrease in their property rates compared to the March tabled budget, which for most households will offset the impact of the fixed charges.
Along with raising the threshold for rates rebates, we are also proposing that qualification for indigent relief uses the same raised threshold of R620,000 so that more Capetonians are able to access this indigent protection.
Thanks to raised indigent relief, more properties from R450 000 to R620 000 will get a 100% rebate on fixed charges.
Madam Speaker
We are glad to have widened protection for lower and middle-income homes in a way that will largely offset the rise in fixed water and sanitation charges for properties under R2,8m.
While the structure of the bill changes, the changes we are proposing mean that the net effect will be very small, if any, changes to the total monthly bills.
We are glad to release for comment today, budget amendments that both protect lower- and middle-income households, and our city’s critical basic infrastructure investment.
That was no small task, I can assure you, and I thank the City’s Budget team for the very hard work these last few weeks.
Speaker,
There is one other very important item on the agenda today, and that is the City’s Traffic by-law.
The Democratic Alliance believes in local governments asserting their own policing and enforcement powers, especially when this is manifestly in the interest of safer roads for the public.
This is a first for South Africa, and meaningfully strengthens the ability of our Traffic Officers and Metro Police to enforce safer driving behaviour on our roads. It can’t come soon enough.
Let me say to all those drivers in Cape Town who endanger the lives of the public through their reckless and dangerous and driving – we intend to enforce this by-law with rigour.
Our officers will impound the vehicles of those who drive in a way that endangers lives, and they will do so without fear or favour.
Our commitment is always to making our roads safer for the public at large, and establishing the rule of law in South Africa, starting here.
I thank the team who has worked on this by-law, and I table the budget amendments for public comment.
Thank you.
Published by:
City of Cape Town, Media Office
