SA consumers pay 46% more for municipal services

2011-03-26 00:00

PRETORIA — Consumers countrywide paid nearly 46% more for municipal services in the quarter ending December 2010 than they did one year before. However, the hikes in KZN averaged 31%, among the lowest.

These facts appear from figures based on reports from the municipalities themselves.

Total revenue from consumers’ pockets in the quarter ending December last year was R47,6 billion.

Municipalities are exacting an increasingly greater proportion of South Africans’ revenue, while service delivery is becoming increasingly worse, says Mike Schüssler, chief economist of Economists.co.za.

Koos Vorster, a Democratic Alliance councillor in Newcastle, says municipalities are “pricing themselves out of the market”.

The size of the group that can still pay is shrinking, but that group is being taxed more and more heavily. He says that, as an example, 72% of the 500 000 Newcastle residents earn less than R3 200 a month, while 90% of the council’s revenue comes from 38 000 residents.

In one of the poorer residential areas, Madadeni, 90% of residents earn less than R5 000 a month, while the average monthly municipal account in the new financial year averages R570, plus about R450 for prepaid electricity a month.

“Can someone earning less than R5 000 a month afford to part with more than R1 000 of that for municipal services?” Schüssler asks.

Meanwhile, the Newcastle residents’ total outstanding debt is increasing by R9 million a month. It currently stands at R642 million.

Vorster says about 90% of the council’s revenue comes from 38 000 residents. He believes a similar situation applies in most municipalities in the country.

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