FINANCE: Cape Town's 14% Budget Increase to R19b
Recent Western Cape Business News
The Mayor of Cape Town, Dan Plato, yesterday tabled a draft budget proposing a 14 percent increase of the operating budget to R19.3 billion. The capital budget declines to R3.55 billion from R5.59 billion, as 2010 World Cup funding comes to an end and future borrowings are limited.
Tariff increases include average increases of 24.6 percent for electricity, 10 percent for water and sanitation and 18 percent for refuse collection.
“The significant jump in electricity prices is inevitable because of the 28.9 percent Eskom bulk tariff increase to local government,” says Ian Neilson, Executive Deputy Mayor and Mayoral Committee Member for Finance.
“The significant increase in refuse collection tariffs is due to the closure of older refuse disposal sites and the subsequent need to transport refuse over much further distances than before. It also provides for a significant replacement of refuse collection trucks.
“The latest general valuation has increased the total property valuation by 27 percent to R805 billion. However, the total required increase in rates income is only 9.3 percent, leading to a reduction in the rate to 0.531 cents-in-the-rand. The initial value deduction has been increased from R88 000 to R200 000,” he said.
In total, the City of Cape Town plans to set aside about R1.2 billion (equal to 6 percent of revenue) to provide relief for the poor and other ratepayers. This includes, amongst others, subsidies of R166 million for refuse removal; R162 million for free electricity; R89 million for free water; R67 million for solid waste for informal settlements; R60 million for indigent relief for tenants of Council-owned houses; and provision for a total subsidy of about R110 million for rates rebates.
The gross monthly income threshold for rebates for senior citizens and people with disability will be raised to R8 500 per household, affording discounts of up to 100 percent.
Business News Sector Tags:
Fax 2 Email
Study IT Online
Work from Home