The full council of the eThekwini Municipality on Wednesday approved an electricity reform strategy in a bid to unlock grant funding from the National Treasury that will go towards rehabilitating and stabilising its ageing electricity infrastructure.
However, the issue was not without controversy, as executive committee members were locked in lengthy discussions earlier on Wednesday, delaying the full council meeting, over an aspect of the strategy that proposes the levying of an additional tariff for electricity infrastructure on residents, regardless of whether they had used electricity or not.
The grant, amounting to approximately R64 billion in total, is “managed” by the National Treasury and is available to all metro municipalities in South Africa, provided they can produce a Trading Services reform strategy. This initiative serves as an incentive for metro municipalities to reform their trading services unit.
Councillors estimated that the City could get more than R1 billion as part of the grant funding.
However, the reform strategy documents had to be submitted to the Treasury by Thursday for it to be considered.
The back-and-forth in exco led to it failing to produce an explicit recommendation approving the reform strategy. Instead, it had noted the strategy and recommended that the City request more time to finalise concerning issues within the strategy.
City manager Musa Mbhele outlined the recommendations made by the executive committee to the council. The recommendations stated: “The council noted the eThekwini Trading Services reform strategy and the supporting documents developed to address electricity challenges, achieve financial sustainability, and improve customer care.”
“In view of certain strategies still requiring clarity, including the issue of potential additional staff for network charges, the council deferred approval of the strategy to its meeting on November 6 and delegates authority to Mayor Councillor Cyril Xaba to write to the National Treasury requesting an extension on the submission deadline,” said Mbhele.
When the recommendation came before full council, it drew criticism from councillors, as they argued it could jeopardise the grant. Councillors expressed concern that the National Treasury had already rejected a request for a deadline extension. IFP councillor Mdu Nkosi, who chairs the Trading Services committee overseeing the electricity department, then sought an amendment of the exco recommendation to allow the strategy to be approved.
It was then approved by full council. He stated: “I plead with my colleagues that we must approve this strategy, and all other concerns contained in the report can be addressed afterwards.
The eThekwini Municipality cannot afford to lose this grant; we cannot be in the media explaining how we lost out on this funding. We have already faced scrutiny over grant issues.”
Democratic Liberal Congress (DLC) councillor Patrick Pillay also called on City councillors to push through the resolution, adding that failure to do so could have dire consequences.
DA councillor Thabani Mthethwa expressed concerns about the potential imposition of new tariffs on residents through the infrastructure charge and consequently, the party did not support the recommendation.
“We are concerned that this opens the door for future tariff impositions on ratepayers, especially since our rate base has been shrinking. It would be unfair to impose new tariffs on the few ratepayers we still have. What we propose as the DA is that, as part of the strategy, we emphasise the need to collect the more than R30 billion (debt) owed.”
The Mercury