Fingers crossed on Msunduzi’s electricity tariff

2013-05-23 00:00

HOPES are fading that Msunduzi Municipality will change its mind and review its proposed 10% electricity tariff increase.

But the business sector and civil society have their fingers crossed for a change or a last-minute reprieve before the budget is passed by full council next week.

The municipality has been urged to consider economic conditions — latest figures from the Labour Department show new claims for unemployment benefits (UIF) are more than five times higher than at the same time last year.

In March 2012, there were 832 applications for UIF in the city; in March this year there were 4 371 applications. The figures for January and February had more than doubled.

According to economists, new claims for UIF are a way of gauging the levels of retrenchments in an area and the numbers that are joining the ranks of the unemployed.

Hopes were initially raised that Msunduzi had reconsidered, when the National Energy Regulator of South Africa (Nersa) listed the names of 10 municipalities that had applied to go above the seven percent tariff increase guideline set by Nersa.

Msunduzi was not among them.

However, by yesterday, Nersa spokesperson Charles Hlebela said there was another set of public hearings for municipalities that wanted to go above the seven percent guideline in June and that Msunduzi may be among them.

Msunduzi spokesperson Brian Zuma confirmed they had applied to raise their tariffs by 10%.

The Pietermaritzburg Chamber of Business (PCB), in its submission on the draft budget, said the proposed increase far exceeded inflation and was unaffordable.

Chief executive officer Melanie Veness said they did make a case for the municipality to adopt a long-term view and to “consider how best to counter unemployment and hence ease the burden of having to supply free basic services to so many households”.

Veness added the municipality was also told that if it created the kind of operating environment where businesses were paying higher tariffs than those in neighbouring municipalities, businesses would move out.

The city’s Electricity Action Group (EAG) has pleaded with the municipality to reconsider the increase.

It says many of its members who have enjoyed electricity provision under the new democratic dispensation will have this taken away.

In a joint statement, EAG members Beverley Bengover and Mandla Gcwabaza said they were already struggling to pay the current tariffs.

“The 10% will take us back to paraffin, candles and wood.

“These are dangerous to our health and to our lives,” the EAG members said.

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