The DA-run City of Cape Town (CoCT) has, in recent years, boasted that it has the highest service-delivery ranking among metropolitan municipalities. However, ratepayers and civic groups argue that this metric masks an escalating affordability crisis and persistent spatial housing inequalities.
The City’s claim refers to its ranking in research think-tank Good Governance Africa’s Governance Performance Index for 2024. According to the CoCT, it was the highest-ranked metro and ranked first for service delivery, the most heavily weighted category in the index.
While the municipality insists that it maintains the lowest overall basket of municipal costs among South Africa’s major metros, civic organisations warn that soaring property valuations and rising tariffs are placing unsustainable financial strain on households.
Bas Zuidberg, chairperson of the Cape Town Collective Ratepayers’ Association (CTCRA), this week said a rates-affordability crisis was rapidly approaching.
“Indeed, it is being exacerbated by the results of the Municipal Valuation Roll, which are causing grave concern in areas that have seen average increases that far outpace the municipal average,” said Zuidberg.
He said anecdotal evidence indicated that more residents had been unable to afford their rates bills since charges for the new financial year took effect on 1 July, amid increased property valuations.
Zuidberg said the association believed the City was not focusing enough on affordability.
“Proof of this can be found in the fact that not only is total expenditure set to increase by 20% over the coming three years, but the portion funded by ratepayers is also set to increase from 68% to 72%,” he said.
“Since the number of households is not expected to increase by more than 5%, this essentially means that ratepayers are looking at an average increase of about 10% annually. That excludes the effect of another valuation round expected in 2029.
“The City is forging ahead with planning for expenditure and then looking at ways to recover that expenditure — more and more from ratepayers. This mechanism is unsustainable.”
The association and AfriForum recently took the City to court to challenge its use of property values to determine fixed municipal service charges.
In April, the Western Cape High Court ruled that the City’s 2025/26 fixed charges for water, sanitation and citywide cleaning were unlawful and invalid, finding that linking tariffs to property value rather than actual consumption was unconstitutional.
Zuidberg said the CTCRA supports many of the things that the City does or is trying to do.
“What we would like to see is that the City puts in a lot more visible effort to reduce its expenses and shift the burden away from ratepayers. Only then can Cape Town truly be ‘a city for all’.
“Review expenses and identify areas where expenditure is inefficient and can be reduced, or where expenditure can be delayed. While we support the large infrastructure projects, CTCRA is asking whether the City is living above its means,” he said.
Reiterating these concerns, Eerste River resident Donald Lewis, who has owned his property for the past 10 years, said rising rates were placing increasing pressure on households.
“It’s not just me. They are taking a toll on the poor, the middle class, and affecting the cost of living and how people have to budget. My rates and taxes have increased to such an extent that they are nearly 50% of the bond I am paying. I feel like the City is contributing to poverty and creating a situation where households can no longer afford their rates and taxes,” he said.
Siseko Mbandezi, Mayoral Committee (Mayco) Member for Finance, defended the City of Cape Town’s tariff structure, saying it offers the “highest rates relief and widest pensioner and indigent benefits” among the country’s five biggest metros.
He said indigent households could qualify for a 100% rates rebate and free basic water and sanitation, while pensioners earning up to R27,000 a month could receive rates rebates of up to 100% and lifeline electricity benefits.
Mbandezi also said the City’s total municipal bill was the lowest across different property values when rates, water, electricity and refuse charges were taken into account. Based on its own comparisons, the City said households could save between R264 and R903 a month on an R800,000 home, rising to as much as R9,657 a month on a R15 million property.
“Cape Town offers the lowest property rates with a vastly lower property rates formula (rate-in-the-rand) compared to other cities. This means that, even with higher property values in Cape Town, you’re still likely to pay less here, while living in a city that works,” he argued.
Mayco Member for Energy Xanthea Limberg pointed to the City’s recently signed agreements to buy electricity directly from independent solar producers. The agreements are expected to cost between 19% and 21% less than current Eskom rates, as part of efforts to reduce costs for residents.
The two 20-year agreements will bring 70MW of solar power from plants in Atlantis and Philippi as the City moves to reduce its reliance on Eskom.
“Of the City’s tariff income for electricity, approximately 80% goes towards buying bulk power from Eskom. Eskom prices thus have a profound impact on electricity pricing and are by far the largest input cost the City has to deal with in regard to electricity prices,” Limberg said.
“Families cannot be expected to absorb endless Eskom price increases forever. That’s why we are working to end reliance on expensive Eskom power to make electricity more affordable for Capetonians.”
Social activist and leader of Reclaim the City, Bevil Lucas, said the housing crisis was a key part of Cape Town’s affordability problem.
“By the City’s own admission and estimates, there is a dire need to house about 600,000 people on the waiting list. In the greater Sea Point area, affordable housing is very necessary. It’s about your domestic workers and security guards,” Lucas said.
“People from Langa are still living in male hostel dormitories. Those hostels have never been renovated or converted into family living units. How inhumane can that be?”
In another court defeat, the Constitutional Court in July in the landmark Tafelberg judgment found that the City and the Western Cape Government had failed in their constitutional obligations to address apartheid's spatial legacy by providing affordable housing in well-located areas.
Lucas said the City’s approach to land was also failing to address the housing crisis.
“It’s putting parcels of land all over the city up for sale to the private sector. The problem with that approach is that it does not address the social needs of people when it comes to housing,” he said.
In response, Mayco Member for Human Settlements Carl Pophaim argued that Cape Town had delivered more state-subsidised housing than any other city since 1994.
“This is from a parliamentary reply by the Minister last year. In the last five years, 12,401 units were handed over in Cape Town,” he said.
Pophaim said the City was also releasing municipal land that would yield about 12,000 affordable rental housing units in well-located areas, including the CBD and other economic nodes.
ntsikelelo.qoyo@nationalmg.co.za