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07/07/2020 11:06:34
Picture: OUTA
Joburg councillors should vote for residents not themselves
The Organisation Undoing Tax Abuse (OUTA) calls on the 270 councillors in City of Johannesburg to act in the best interests of their residents and to vote for against any salary increases and any tariff increases in the in the 2020/21 budget.
The council failed to pass the budget before the start of the financial year on 1 July, and the Gauteng provincial government has now given it a deadline of Friday or face intervention.
OUTA believes that salary increases by the City have been abused. “The salary bill since 2007/08 increased by 192% far exceeding CPI of 89% over this period. If the City had used the average CPI increase in its wage bill, it could have saved its residents R21 billion,” says Julius Kleynhans, OUTA Strategy and Development Executive. “The saving in 2018/19 alone would have been R4.5 billion to Joburg residents. In this period the City's personnel headcount only increased by approximately 4%.”
In our submission on the City of Joburg's draft budget for 202021, OUTA called for an investigation into plans by the City to pay the mayor, the speaker and the chief whip more than the legal rate.
“The lack of maintenance is reaching unacceptable levels, with electricity outages, broken traffic lights, the lack of pointsmen, potholes, exposed electricity boxes, sewage running down the streets. The money wasted on salary increases over the last decade could have addressed the backlog in maintenance and repairs on infrastructure. Treasury guidelines suggest that 8% of the asset carrying value should be spent on maintenance, yet Joburg has spent only 2.9% on average over the past decade. This speaks to why the City infrastructure is deteriorating,” says Kleynhans.
In its submission on the CoJ draft budget, OUTA, along with thousands of Joburg residents, opposed any tariff and property rates hikes, or increases in salaries for municipal staff and city councillors.
The draft budget shows that the City plans to vote for a 6.4% pay increase for its councillors and 5.4% for municipal employees. OUTA understands that employee salary increases were part of prior bargaining council negotiations; however, agreements do have escape clauses and the current pandemic, along with a crisis in the affordability of city management, must surely be enough reason to cancel any salary increases previously agreed.
OUTA has also argued that the City is not in a financial position to provide any increases due to the impact of the economic crisis on its residents, deeming it unfair and irresponsible to allow for increases to property tariffs and levies, whilst its residents are struggling to make ends meet in these devastating financial conditions.
More information on OUTA’s objections to the City’s draft budget is here.
A small victory for residents is that the City of Johannesburg has decided to drop plans for a new monthly charge on prepaid electricity. However, OUTA raised a concern that this charge might still be applicable to business prepaid customers. The City had planned to charge domestic users R230 (incl VAT) a month and businesses R460 (incl VAT) but failed to explain what these increases are for. We believe that pressure brought to bear by civil society has given rise to this decision being reversed.