PCB: 14,3% hike can lead to job losses

2018-03-28 13:45

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The Pietermaritzburg Chamber of Business (PCB) says the proposed 14,3% increase in water tariffs could lead to massive job losses as many businesses cannot afford the compound increase from last year’s 15%.

On Tuesday a PCB delegation, led by the chief executive Melanie Veness, said they met with officials from Msunduzi and mayor Themba Njilo to discuss the increase.

Veness said they are also objecting to the new R6 000 town planning tariff for the placing of newspaper advertisements for public hearings on developments.

Currently the developers are responsible for such advertisements as well as for sending out registered letters and placards.

“It’s a time and detail sensitive process.

“Currently it works, so [we] don’t understand why it now has to be placed in the control of town planning,” she said.

She said they are concerned that the City already has capacity problems and it has a cumbersome procurement process.

Veness said: “Some businesses are either going to close down or retrench people because water will become unaffordable.

“Last year we faced a 15% increase from Msunduzi on water tariffs that were already marked up between 353% and 462%. The compound effect of this is significant,” she said.

The PBC’s biggest concern is that Umgeni Water’s 13,7% tariff increase has been approved by the ministry of Water and Sanitation even though this is yet to go before the national assembly.

“We hope we can still appeal the minister’s approval because we don’t have a water regulator like we have Nersa [National Energy Regulator] for electricity,” she said.

However, she said the 13,7% increase on the cost of water cannot be used as a justification for the application of a similar increase on the onward sale of water to consumers, because water is already marked up significantly by Msunduzi.

Chief financial officer Neli Ngcobo said the City is also disputing the 14,3% water tariff increase and intends to approach Umgeni on the possibility of getting a reduction.

She said Msunduzi will also be calculating its cost-reflective tariff, which will take into consideration factors of the labour, levies and water losses, for presentation to the full council next month.

“We are of the view that a six percent increase is more reasonable but we can’t use that if Umgeni is saying 13,7%,” she said.

The ratepayers have until April 7 to submit their comments on the proposed tariffs.

Read more on:    pietermaritzburg  |  tariff increases

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