The Ekurhuleni Metropolitan Municipality announced tariff increases across the board when releasing its 2010/11 budget on Thursday.

Electricity tariffs were set to increase by 28,9%, water by 15,5%, sewer rates by 18,8%, refuse removal by 15% and assessment rates by 8,5%.

During a colourful address held in Germiston and attended by television personalities and traditional healers, as well as citizens of the city, Executive Mayor Ntombi Mekgwe said that the budget had been compiled during the worst economic downturn since the inception of the metropolitan council, which borders Johannesburg, on its west, and Tshwane to the north.

The downturn had left the council in a weakened financial position over the past 12 months, with a reduction in collections owing to economic pressures.

Mekgwe said that the reasons behind the rates increases varied from sector to sector, but she highlighted surging tariff rates from bulk some suppliers, such as power utility Eskom, and the fact that some services were running operational deficits.

However, the Democratic Alliance Ekurhuleni leader Eddie Taylor said that the hikes would not have been necessary had the municipality been more efficiently run.

He said that the metropolitan council had written off R1,3-billion in bad debts, had only collected about 50% of money owed, and had poor credit control practices.

BOND ISSUANCE PLANNED

The Ekurhuleni council announced a capital budget of R2,16-billion for the year, a decrease from last year's R2,27-billion.

"New external funding for capital of some R1,1-billion a year will be generated by issuing bonds in the next three financial years.

"In addition to this, external grants of about R702-million a year are included in this budget. As in previous years, the municipal infrastructure grant will fund the bulk of the externally funded project," said Mekgwe.

The budget will be spent on customer care areas (R112-million), community safety (R65-million), economic development (R39-million), electricity and energy (R293-million), solid waste (R170-million), parks (R72-million), health (R117-million), housing (R304-million), pedestrian safety and improvement programme (R500-million), water and wastewater (R186-million), and the upgrade of recreation and sports facilities (R102-million).

During the budget vote debate, Taylor noted that the municipality had, on average, under-spent its capital budget by 25% for the last ten years. "This current year we will be lucky if they spend 50% of the 2009/10 year budget. This is why the people of Ekurhuleni has to suffer with poor service delivery."

Further, he said that minimal funds of the budget were allocated towards the development of business in the area.

"We need growth to look after the poor and business brings growth.

"In addition, our infrastructure is deteriorating at a rapid pace. It will cost us more than double this year's budget just to fix the electricity distribution network."

The municipality said it had spent around 65% of its budget, or R6-billion, on infrastructure in areas occupied by previously disadvantaged citizens over the past ten years. "We are not ashamed that we have spent the money towards the betterment of our people and restoring their dignity," commented Mekgwe.

Yet, Taylor noted that the area was still suffering with a 40% unemployment rate.