Massive public outcry over Cape Town's controversial 2025/26 budget proposals

Source: Pexels.

The objections focus on the proposed tariff structure, which is based on property values and includes fixed charges for water and sanitation (as opposed to being based solely on estimated volumetric usage), as well as a new city-wide cleaning charge to fund street sweeping and the removal of illegal dumping.

This has prompted more than 10,000 residents to sign a petition against the reforms. The petition is led by the City of Cape Town Collective Ratepayers’ Association (CTCRA), which represents over 45 ratepayer groups.

Critics argue that the removal of cleaning charges from electricity bills—under pressure from National Treasury—has simply led to their reintroduction as separate levies. While the city claims electricity tariffs will only rise by 2%, experts note this is misleading and does not reflect the full impact on ratepayers, especially those in Eskom-supplied areas or with solar power.

City officials said while the proposed budget is meant to protect households under R2.5m, it has heard the concerns of ratepayers in higher-value properties particularly those of the NRPA and the Fish Hoek Valley Ratepayers’ and Residents’ Association who warned that the budget’s structural changes could result in monthly increases of up to 30% for many households — especially those in properties valued above R3m.

Fixed-charge backlash

Keith Barton, chairperson of the Bergvliet Meadowridge Ratepayers’ Association, says the draft budget unfairly shifts the burden onto middle- and upper-income households through steep increases in fixed charges linked to property values.

“If approved, this budget will cause financial strain for many middle-income homes.

"A typical R4.2m property in our suburbs would pay R920 more per month in fixed charges — irrespective of the amount of electricity and water consumed. Households with solar and boreholes using minimal City services could see monthly municipal bills rise by over 30%.

“The City says this new structure ends the past practice of cross-subsidising other municipal services via electricity sales. We do not believe that municipal charges should be so heavily skewed towards a property’s value instead of its consumption of services.

“However, we believe that, if the City is hell-bent on this method of imposing charges, it should mitigate the effect of the increases by adopting a phased approach that gradually phases out cross-subsidies while incrementally introducing the new fee structure over several years instead of doing this in a single budget cycle,” Barton said.

City rethinks tariffs

On the back of this public outcry, sources say that the City intends to amend and republish the budget, followed by an additional two-week public-consultation period.

While the City has not officially confirmed this, it acknowledged that it is considering steps to ensure the final budget is legally adopted before the new financial year begins on 1 July 2025, in accordance with the Municipal Financial Management Act.

Relief measures proposed

In response to the outcry, Mayor Geordin Hill-Lewis has proposed potential relief measures, including extending rates-free thresholds, easing pensioner-rebate criteria, and reducing cleaning charges for certain properties.

Despite the criticism, the City maintains that its service delivery is superior to other metros and that major infrastructure upgrades—costing R40bn—are necessary. However, the CTCRA argues that these upgrades could be phased in more gradually and calls on the City to explore alternative revenue streams rather than disproportionately targeting ratepayers.

With limited time left before the 1 July implementation deadline, the City faces pressure to amend the budget and still comply with legal and administrative requirements.