While the party is making a big show of fighting for lower tariffs in the press and parliament, in court, and in the municipalities, they are fighting to raise them
Recently, the DA has begun selling the idea that they are against electrical rates increases. This is a popular idea, since people obviously don’t like paying for above-inflation rates increases.
They have pledged to take the fight to Parliament over leaked figures suggesting massive price hikes over the next few years, ostensibly to pay for the massive grid capacity expansion due over the course of the present political cycle, arguably necessary to end loadshedding (there is an argument to be made over whether this money is being well-spent, but that's for another article).
The report does indeed suggest some rather painful, even dramatic increases:
But the DA's claim to be staunch advocates of reducing the burden on the taxpayer do not stand up to scrutiny. In fact, it flies in the face of their standing policy, which is to consistently charge above the NERSA rates recommended for their locations.
In 2019, Afriforum had to threaten Tshwane with litigation for their insistence on charging above the rates approved by NERSA. Other municipalities, such as eThekwini, which had also sought tariff increases beyond NERSA’s rate, ultimately complied with national regulations after the regulator gave them a bit of a slap.
But in the Cape, the DA are far more brazen, and have in fact taken NERSA to court to fight for the right to charge as a far above the recommended rates as they like. Their argument is that if they don’t, they will suffer a budget deficit.
With some of the steepest municipal rates in the country, and the second-largest property wealth base to draw from (after Johannesburg), one would think Cape Town would be swimming in liquidity.
But this is the party that campaigns on the platform of defending and increasing welfare grants in lower-income areas, and boasts of spending 75% of their budget on free services. (This is also the party that burnt through R3 million defending itself against blowback from the expulsion of a corruption whistleblower over a minor fee discrepancy, and lost).
In 2022/2023, Cape Town imposed a 9.6% tariff increase, exceeding the 7.47% approved by the National Energy Regulator of South Africa (NERSA). For 2023/2024, the hike was 17.6%, compared to the sanctioned 15.1%. Over the past two years, the city has discreetly used ratepayers’ funds to litigate against NERSA, seeking judicial approval to disregard the national tariff.
This practice has led to substantial overcharges, amounting to hundreds of millions of rands. In a rare statement last year, the city defended its actions by arguing that adherence to NERSA's tariff for 2023/2024 would result in a R500 million shortfall. Should the city lose its court battle, these funds would need to be refunded to consumers, including the previous year's excess charges.
In April of this year, GOOD Party MP Brett Herron queried the Minister of Mineral Resources and Energy, under whose purview NERSA operates. Minister Gwede Mantashe stated that the City had not sought an interim order to impose a tariff exceeding NERSA's approved rates, rendering its unilateral implementation unlawful and in breach of its distribution license.
Upon discovering the City's non-compliance, NERSA attempted to arrange a meeting, but the City declined, citing its ongoing High Court review case. NERSA opted to await the court's decision before taking further action.
The City and NERSA are currently in court over the tariffs for 2022/23 and 2023/24. Mantashe noted that the outcome of these cases would address the impact on customers and outline the necessary remedies and their implementation timeline.
Of course, this is not the pettiest form of taxation implemented by the DA, who have gone so far as to implement a dog license in Hessequa, where the municipal manager Albert de Klerk, currently under fire for a severe corruption scandal, has allegedly threatened to confiscate peoples dogs if they don’t pay the fees.
DA-governed municipalities are also straining people's budgets in water rates - those using 10kl of water per month are paying 252% more than they did when there were Level 4 water restriction tariffs in 2017, and rates keep increasing despite record rainfall.
The notion that the DA are in defence of the middle class’s interests rests on rather thin ice these days.
