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CCCI: Statement by Cape Chamber of Commerce and Industry, Business unhappy about City's electricity account increase (12/09/2014)

CCCI: Statement by Cape Chamber of Commerce and Industry, Business unhappy about City's electricity account increase (12/09/2014)
Photo by Reuters

12th September 2014

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/ MEDIA STATEMENT / The content on this page is not written by Polity.org.za, but is supplied by third parties. This content does not constitute news reporting by Polity.org.za.

The Cape Chamber of commerce and industry is receiving widespread complaints from small businesses about massive increases in their electricity accounts.

What appears to be happening is that the city is extending the use of daily service charges to more customers and this is resulting in account increases of up to 223 percent.

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“The shocking thing about this,” said Ms Janine Myburgh, President of the Chamber, “is that there has been no warning and no consultation with customers. This is not the way things should be done. Customers should be treated with respect.”

The small businesses facing this new blow are the electricity consumers who already pay the highest electricity tariffs in the City.

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According to the City’s official tariff schedule, there are two categories of small commercial power users (under 1 000 kW/h a month) in the first category consumers pay a daily service charge of R22.25 (R25.37 with VAT) and an energy charge of R36.83 a unit including VAT.

The second category has no service charge but a higher energy charge of R213.97 a unit including VAT. The schedule does not explain how users qualify for the different categories. And no explanation has been given to justify the sudden use of daily service charges for businesses which were not required to pay it before.

“Whichever way you look at it, a sudden increase of 223 percent is both unreasonable and unacceptable,” said Ms Myburgh. “If there is a legitimate reason for the change it should be phased in after a process of consultation. As it now stands, one can sympathise with people who feel it is a sneaky way of getting more money out of small business.

“The country is looking to small business to help the economy grow and create jobs and then the City treats them like this,” Ms Myburgh said.

Mr Peter Haylett, chairman of the Chamber’s Industrial Focus Portfolio Committee, said the underlying problem was that the City had relied too much and for too long on its income from electricity sales. “Now businesses and domestic consumers are finding ways to use less electricity and the City is losing revenue.”

He said it was in the national interest for people to use less electrity so that there would be more current available for industry and the mines. “We should thank them but the City is punishing them with tricks like the daily service charge to increase their electricity income. Small business is being punished for doing the right thing.”

He said that what saddened him most was that the situation had been quite predictable. “It has been getting steadily worse over the last few years and a complete rethink of how the City uses its revenue from electricity is long overdue.”

Issued by The Cape Chamber of Commerce and Industry

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