‘Unfair and unfit’

2017-05-24 13:45
Msunduzi and business sector at loggerheads over power tariffs.

Msunduzi and business sector at loggerheads over power tariffs. (File)

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Businesses are “hairs away” from closing down and if the City’s electricity tariff increase proposal is implemented, it will mean the end of many companies in Msunduzi.

This was the plea from the business sector airing their opinions on the municipality’s latest plan to increase electricity tariffs by 3,08% — well above the level set by the National Electricity Regulator (Nersa). The money accumulated from the increase will be directed to maintaining, upgrading and replacing infrastructure and for salaries.

Msunduzi Municipality and the business sector agreed to disagree on Tuesday during a public consultation meeting with businesses at City Hall.

Senior municipal managers and the business sector battled back and forth while discussing the proposed increase.

The Pietermaritzburg Chamber of Business (PCB) held a strong presence in the meeting and pegged their stance on opposing the proposed tariff.

PCB CEO Melanie Veness said the municipality was creating an “unfair and unfit” economy for businesses in the city. She said the municipality was billing businesses and residents when it had failed to use the funds meant for maintenance and upgrades wisely.

“The [municipal manager] speaks as if we all found ourselves in this boat somehow. We found ourselves here because Msunduzi didn’t spend the money the way they were supposed to. This is not a small increase on the tariff. We will have to lay people off to make up for those costs,” Veness said.

Veness was retaliating to acting city manager Sizwe Hadebe’s call for both businesses and the municipality to work together in ensuring the city “runs well”.

Veness said businesses were already paying a fair price for electricity and were not receiving a decent service.

“We don’t want to pay prices that we paid years ago. We want to pay a fair price and for us, the Nersa increase is enough,” she said.

General manager of infrastructure services, Sabatha Nomnganga, said a study conducted about three years ago revealed that R892 million was needed to replace and repair the city’s infrastructure. He said they are currently updating the study and the amount needed would exceed R1,2 billion as infrastructure had surpassed its lifespan.

“This is just for major sub-stations,” he said.

Nomnganga added that his department was in the process of submitting their five-year maintenance plan to council.

In an attempt to explain why businesses and ratepayers were not properly informed on the increase, technical engineer Simphiwe Mchunu said they were only later informed that Nersa allowed a further 1,8% increase.

“It was later on that Msunduzi decided to add another 1,2% to the 1,8%. Unfortunately the public participation session was already over,” he said.

The municipality’s chief finance officer Nelisiwe Ngcobo said the municipality made every attempt to keep the increase at a minimum.

“We did not just thumb suck this figure. A study was done and we arrived at this increase. The council said our people are poor and this is the lowest increase we could come up with,” said Ngcobo.

As raised by one of the speakers, Ngcobo agreed the municipality needed to manage and recover debt faster, but she criticised the business sector, saying they contributed 30% to the municipality’s debt.

“We even have a top 10 of businesses who refuse to pay and when we try to get the money, we are taken to court as a delaying tactic. Businesses also have to start playing their roles too,” she said.

Director of the PCB Raj Seeparsad called on the municipality to “name and shame” those businesses and avoid “tarnishing us all with the same brush”.

The meeting concluded with all submissions handed in. These will be presented to a full council meeting next week for a final decision.


Read more on:    pietermaritzburg

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