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Tabling his proposed budget for 2023/24 today, Mayor Geordin Hill-Lewis claimed to be protecting residents by reducing Eskom’s 18,49% electricity price increase to 17,6% in the City of Cape Town. 

But the simple truth is, if this leadership is serious about helping its hard-pressed residents, they can use some of the public money sitting in the bank to give people a break - and still be left with savings.

These are no ordinary times, and our residents need decisive leaders and bold steps.

As it stands, this proposed price hike, along with the skyrocketing food prices and overall high costs of living, is simply making life unaffordable. And with inflation standing at 6,9%, this is a heavy increase on the average household. 

When Eskom received approval for a massive 18% tariff increase, this pushed the cost per kilowatt hour to 173.80c/kwh. In Cape Town the tariffs were already nearly double that on average. So, while municipalities must raise revenue in order to provide services, the mark-ups must be fair, affordable and just in the current financial climate. 

This particularly applies to a relatively well-off City, with savings in the bank.   

As at the end of January 2023, the City had accumulated an additional surplus of R600 million over their projected revenue collection, which already included a R2 billion surplus from electricity sales. At the same time they had incurred an under expenditure of R828 million in their operating budget. 

Collecting more and cutting costs by spending less is good news. 

It’s already led to an operating surplus of R1,4billion so far.

The City had also projected a cash bank balance of R7.4 billion for the current financial year but has already accumulated R8.5 billion cash in the bank. 

The latest Financial Monitoring Report indicates that “this positive cash position has been maintained since the previous financial year”. Thus the City is cash flush and has been since last financial year. 

Residents of Cape Town have already been paying massive marks up on electricity. On average, the City pays 170 c/kwh, while they sell it to the consumer for up to 433 c/kwh. There is thus enough space to absorb the new ESKOM tariff.

With regards to the Lifeline tariff threshold being increased to R500 000, unfortunately, this is largely meaningless because there are very few residential properties with a market value of R500 000 or less.

The cash surpluses accrued and the billions in the bank make it clear that with political will the DA government could have absorbed far more of the Eskom tariff increase. 

This is public money it’s sitting on and it should be used to assist the residents of Cape Town who are already heavily burdened.

Issued by GOOD: Cape Town Councillor responsible for Finance Anton Louw