Dear Valued Setsoto Municipality Consumer/Resident
TARIFF INCREASE – BUDGET YEAR 2020/2021
This communique serves to clarify the malicious rumors that are doing the round on social media and Whatsapp groups, intending to deliberately mislead the community of Setsoto residents regarding the yearly tariff increase.
When considering the yearly tariff increase, the Municipality is guided by the relevant circulars from National Treasury. The Municipality strictly adhere to this guidance and it needs to be mentioned that both the National and Provincial Treasuries execute their oversight role very well in these circumstances.
Hereunder is the proposed tariff increase per service based on a domestic user (Household). More detail is available in the budget document tabled to Council and is available at the Municipal Offices for perusal.
| DESCRIPTION | 2019/20 TARIFF | 2020/21 TARIFF | TARIFF INCREASE | % INCREASE |
| Assessment Rates | R0.02/R | R0.02/R | R0.00 | 0% |
| Assessment Rates – Rebate | 50% | 47% | 3% | 6% |
| Electricity – Basic charge | R276.63 | R290.46 | R13.83 | 5% |
| Electricity usage – Average on block tariff | R1.49/Kwh | R1.58/Kwh | R1.09/Kwh | 6.3% |
| Refuse | R118.84 | R125.97 | R7.13 | 6% |
| Sewer | R102.20 | R108.33 | R6.13 | 6% |
| Water – Basic charge | R115.12 | R122.02 | R6.90 | 6% |
| Water usage – Average on block tariff | R6.20/Kl | R6.57/Kl | R0.37/Kl | 6% |
Note that all tariffs mentioned above exclude VAT. VAT is levied in terms of the VAT act at 15%.
The electricity tariff is regulated and approved by NERSA (National Electricity Regulator of South Africa) and is thus within the tariff range set. As far as the Basic Electricity charge is concerned, Whether you are a Pre-Paid meter user or Conventional meter user the basic charge remains payable as the consumption charge is based on energy only and does not include any maintenance done on the electricity network. These charges need to be recouped in one or another way to ensure that the distribution network remains intact. Cognizance should be taken that Eskom increase the tariff for bulk purchases with 7.3%, while the municipality only increase by 6%.
With the compilation of the 2020/2021 budget, the Municipality was mindful of the dire economic situation and applied a reasonable tariff increase for the respective financial year. Concurrently with the outbreak of the COVID-19 pandemic it is envisaged that the tariff increase is reasonable and affordable to the consumers. The COVID-19 pandemic also brought its own economic pressure on the finances of the Municipality, specially that additional expenditure that was incurred when mitigating the impact of the pandemic needs to be financed within the budget. This expenditure was accommodated within the budget framework, without increasing any tariffs to curb the expenses. It is the Municipality stance from the onset to increase tariffs with an average of 6% for the year. Cognizance should be taken that in terms of the MFMA (Municipal Financial Management Act) the Municipality can only apply a tariff increase once a year and that is with the implementation of the specific year’s budget.
We trust that the budget 2020/21 tariffs have been simplified and that the community at large will concur with the decision to be taken by Council. All the residents of the Municipality who are unable to pay their services and can prove to that effect are welcome to register on the Municipality’s indigent register, subject to meeting the criteria applied for qualification. Registration can be done at the Municipal Offices during normal office hours.
Yours faithfully
CLLR. K.E. KOALANE
EXECUTIVE MAYOR