THE first signs of the negative impact of the Msunduzi Municipality’s
massive electricity tariff increases have become evident, with several
businesses announcing their immediate or imminent closure.
Michael Selby has a sign outside his Mayor’s Walk Internet cafe, announcing its closure at the end of this month.
He is not the only casualty of the city’s commercial tariff hike of well over 900%.
In downtown Pietermaritzburg, the long-established Popatlall Kara’s is
having a closing down sale and Nafique’s Boutique has already closed.
Popatlall Kara’s is one of the city’s oldest sari and Eastern wear
Others — like the Soni Jewellers stores, which have been in business in
the city for 120 years, and Berjak’s Picture Framing, which has operated
for over 46 years — have adopted a wait-and-see attitude.
Chris Berjak is waiting for the National Energy Regulator of South
Africa’s (Nersa) decision on the tariff before deciding on whether to
Hemantlal Soni joined forces with other businesses and, at a meeting
yesterday, a decision was taken to fight the municipality on the tariff
issue. “We are not going to sit back and allow the municipality to walk
all over us. With these tariffs we can neither balance our books nor can
we pass on the increases to our customers, because they are the working
class and already burdened,” Soni said.
He added that momentum around their cause was building up. “We already
have the full support of attorneys and senior counsel, who are prepared
to take our case free of charge,” Soni said.
However, Selby is not prepared to wait; his mind is made up.
“If they are made to change this tariff, they will try to get the money
some other way. It is not just the tariffs, it is the way they spend our
money. Instead of fixing the potholes or getting more traffic police,
our money is being spent on concerts and brick roads. Quite frankly, I
am gatvol,” said Selby.
The sign outside his shop says, “We apologise for the inconvenience that
will be caused by losing the Internet cafe, but there is nothing we can
do, as the municipality is bleeding us dry.”
Four people, including Shelby, will be jobless. “With the rate of
unemployment in this country, how can the municipality justify their
increases, when all they are doing is adding to the unemployment rate?”
“I cannot increase my prices as my customers cannot afford to pay the
amount that I would have to charge to stay alive,” said Selby.
Fazila Bhamjee has cajoled the downtown business community into fighting the tariff increases.
Bhamjee said that many had no choice but to fight, because their shops
were their bread and butter. “We have to fight this or how else are we
going to support our families? We don’t have the luxury of being able to
Bhamjee said the business community was infuriated by the lack of
feedback from councillors and officials. “In past elections, ANC
councillors came to us for funding and support. Now when we call them
about this tariff increase, they turn their backs on us. “We are going
to fight them for bleeding us dry and killing local business. We are
also fed up that this has been dragging on. The municipality is blaming
Nersa,” Bhamjee said.
A survey conducted by the SA Chamber of Commerce and Industry (Sacci)
found that businesses under pressure from increasing costs might soon
start passing the increases to consumers.
Sacci CEO Neren Rau said small and medium enterprises surveyed said they
were worried about the high cost of doing business, particularly due to
electricity prices, municipal levies and the cost of complying with
Rau said the national chamber was aware of the local tariff issue and
had fully supported the Pietermaritzburg Chamber of Business (PCB) in
its representations to Nersa.
He said businesses did not have the capacity to absorb costs in the
present economic climate. In Pietermaritzburg, however, the increases
were too high to pass on to customers. He said such hikes end up with
disastrous consequences: businesses close and jobs are lost.
Rau said municipalities needed money to fund their operations and
raising tariffs was an easy way to get that money. However, money could
also be found if inefficiencies were addressed.
“There is a need to deal with these inefficiencies as municipalities
will reach a point where they simply cannot go on raising tariffs.
Communities are also beginning to fight back because they are tired of
throwing money that disappears down a bottomless pit, and there is
little to show by way of service delivery how the money is being spent,”
Rau said. - The Witness
MSUNDUZI has been slapped down by the National Energy Regulator of South
Africa (Nersa), ordering the municipality to reverse crippling tariff
hikes imposed on city businesses.
Pietermaritzburg Chamber of Business CEO Melanie Veness read out a
letter on the reversal, sent to her by Nersa, to a packed meeting at
Chamber House yesterday.
She said the new letter was addressed to the municipality. In the
letter, Nersa said the municipality was applying its tariffs incorrectly
and that they must be changed.
The development comes as city businesses close or threaten to close under hikes that saw some charges rise by 900%.
The basic charges approved by the energy regulator had included the MCB
or net ampere charge and they had only approved a seven percent increase
along with other power charges.
But when the municipality sent out bills to businesses they massively
hiked the basic charges by 900%, rising in some cases from an original
amount of R49 to R661.
Nersa CEO Phindile Baleni wrote in the letter: “The basic charges that
Nersa approved for these tariff categories is made up of the basic
charge and the net ampere charges (MCB) applied for by the municipality.
“In light of this there is no need to charge net ampere charges (MCB)
over and above the basic charges that Nersa communicated to you in the
above-mentioned correspondence. This has always been the way that these
tariffs were approved and communicated to you in the past and you
implemented them correctly.
“However, in the current year the municipality implemented the basic
charges and net ampere charges (MCB) separately resulting in double
counting of the net ampere (MCB) charges.”
Baleni then went on to provide a table of charges that saw the
commercial basic charges go right back to what they were before the
hikes, less than R50 a month. - The Witness
The citizens of Pietermaritzburg are none too pleased with the municipal government. The municipality has had a rough couple of years thanks to mismanagement and corruption. The municipality has been trying to clean up its image, but every now and then it does something ridiculously stupid that sets it waaaaay back. Like put local businesses out of business because of massive electricity tariff hikes instead of implementing other changes to cut costs. Like stop being corrupt. You know. Simple things.
In the Witness newspaper today (for Mayor 'didn't know' - council reverses tariffs, claims anger was a surprise. Now obviously that is just downright ignorant, simply because the people working for the municipality (especially the big wigs) actually think that other people are going to believe that. Thanks. Unfortunately, many of the people working for the government did not even finish high school (like the president of South Africa who received no formal schooling). But then again, it's not like an education in the current system is actually very useful, especially with all the stunting of original thought and creativity and such (also the lack of discipline) - but that's another blog. So back to the article from today: the mayor claims to have not known about the outrage regarding the tariff hikes, blaming the citizens and local organisations for not informing him of the peoples' anger. He claims to not read newspapers too often, further pleading his case of ignorance. The whole matter has been circulating around the city for weeks, and if I am not mistaken, it is the job of the Mayor to make sure that the needs of the citizens are met and that their voices are heard.
which I am unable to provide link due to the paper's website demanding that I pay for that privilege), the headline was
I can imagine that similar scenarios are common across the country and even the world - where those people working in the government just don't have any idea what they're doing. There is no single cause (aside maybe from human stupidity) for these all-too-common issues - it is a combination of factors all to do with the current human condition.
I suppose that there is one root reason for all those different causes existing: the people who are working in government do so for their own personal gain and not for the upliftment and improvement of their community (or country, world etc).