Profiting off the poor: the DA’s water tariffs exposed

26 March 2019

In their March upgrade for the City of Cape Town credit outlook, International rating agency Moody’s confirmed that the “high water tariffs .. increased revenue from water sales by 7%, reaching R4.4 billion, and the cash generated from operations increased by 13% to R7 billion supporting an improved liquidity in fiscal 2017.”

This confirms that the billions of profit recorded last year were as a result of overcharging of water through the implementation of the immorally high water tariff that I fought against in January last year. 

I proposed water restrictions be put in place well before the National Government was concerned about our drought.  Although I was in support of water restrictions to reduce our water use, I was not in support of high water tariff increases. 

Following guidance from experts, I had proposed a temporary R150 per month drought tariff, to be in place for 150 days, to cover the predicted R1.6 billion shortfall in funding as a result of reduced water use.  Low income households and small businesses (below R400,000 and R50,000 property values respectively) were to be protected from these charges. 

This temporary drought levy was rejected by the DA Caucus and replaced with a more permanent pipe levy charge, together with steeply escalating costs for water.  In the January 2018 Council meeting I pleaded for relief against their high tariffs.  I appealed for relief from the tariffs for households using less than 6kl of water per month and for relief for large families who would be unfairly charged (see Council transcript attached).

My appeal for relief for the poor and for households who were already saving water was ignored and instead used by DA Councillors to launch a Motion of No Confidence against me.  In motivating for the MONC, the DA said I was being “financially reckless” and that this income would be impossible to replace otherwise.

Those statements were shown to be lies.  This month, Moody’s confirmed the City’s R4.4 billion profit from water sales last year.  

These profits are the unjust windfalls of the immorally high water costs approved by the DA Caucus despite my pleading that we would be able to, and should, provide relief to residents using little water and those with large families.

Capetonians do not deserve these immorally high charges.  Capetonians must punish the DA at the polls for how they have exploited the poor and vulnerable in our city.

Issued by Cameron Arendse on behalf of GOOD, 26 March 2019