City insists on raising rates; letting ANC control the purse strings

The City of Cape Town has rebuffed an attempt by the Cape Independence Party (CIP) to join a legal dispute over the municipality’s recent rates hikes.

CIP sought to intervene as an Amicus Curiae, arguing that the City’s financial woes (the nominal cause for recent steep rate rises) stem from an inequitable revenue allocation from the national government under the Division of Revenue Act, as SAPOA challenges the City’s unilateral rate increases and additional levies under Section 214 of the Constitution. The case, lodged by the South African Property Owners Association (SAPOA), contests the legality of the increases, which SAPOA deems excessive. Despite SAPOA’s backing, the City opposed the move.

This is quite clearly a political move, motivated not by any desire to attain a better deal for its constituents, but by a desire to preserve the system of hyper-aggressive wealth redistribution, under which the City receives only R5 billion of the R230 billion its taxpayers send into the National Treasury.

Jack Miller of the CIP has long hammered at them over this in council, only to be told that the City needs to support the rest of the country. The City’s formal position hinges on the claim that the current revenue distribution fails to reflect the City’s service delivery obligations, a shortfall the party says has forced the municipality to impose charges far outpacing inflation.

The City’s rejection of the Cape independent movement and SAPOA’s involvement, however, has scuppered a chance for the Western Cape High Court to consider ordering a fairer funding split—an outcome that might have eased the burden on ratepayers. Instead, the City appears committed to defending its tariff regime.

Jack Miller, CAPEXIT’s leader, has voiced dismay, pointing out that the City’s own mayor, Geordin Hill-Lewis, has admitted to chronic underfunding. “The preference for squeezing ratepayers rather than securing a larger national share defies logic.” The implicit argument which arises from the context of the Mayor’s remarks on this matter, are that the money is better in ANC hands than in DA hands, provided it is being partially spent on wealth redistribution.

This is a very aggressive socialist position in essence.

The CIP, supported by the affiliated Cape Independence Advocacy Group (CIAG), is now consulting its legal team to plot its next steps in a saga that underscores the tensions between local governance and national fiscal policy.

The City of Cape Town’s recently adopted budget has ignited a fierce legal dispute, with SAPOA challenging its legality in the Western Cape High Court. SAPOA, representing major property owners like the V&A Waterfront and Canal Walk Shopping Centre, as well as the general interests of middle-class homeowners and renters, seeks to declare the citywide cleaning tariff, revised water charge, and sanitation charge unlawful and arbitrary.

Public outcry earlier this year forced the City to scale back its initial tariff hikes, which had sparked thousands of objections. Cleaning charges for properties valued under R20 million were notably reduced from the March 2025/26 draft budget. Yet, the revised measures have failed to quell discontent. Sapoa argues the tariffs violate the Local Government Municipal Systems Act, which mandates that charges reflect service usage.

The democratic-socialist GOOD Party and middle-class activist group STOP COCT have now joined the fray as amici curiae, amplifying concerns over the budget’s fairness. GOOD’s secretary-general, Brett Herron, contends the budget disproportionately burdens ratepayers based on property values, exacerbated by gentrification and inherited properties. “It’s illegal, unfair, and cloaked in lies about redistributive justice,” he said, highlighting the strain on vulnerable households.

STOP COCT, led by Sandra Dickson, echoes these concerns, reporting daily pleas from residents grappling with municipal bill increases of R400 to R1,000. The group supports Sapoa’s challenge, arguing the tariffs are unaffordable for many. The legal battle underscores a broader discontent with the City’s fiscal approach, which critics say punishes ratepayers already stretched by economic pressures.

Mayor Geordin Hill-Lewis has defended the budget, framing Sapoa’s challenge as an attempt by wealthy property owners to dodge fair contributions. He insists the budget protects homes valued under R2.5 million and extends relief to middle-class households, preserving critical infrastructure. Yet, his claim that SAPOA’s bid would force “ordinary families” to subsidise the rich rings hollow when all ratepayers face steep increases. His assertion that equitable charges would be “regressive” glosses over the budget’s broad impact, which predominantly squeezes middle-income households to the benefit of both informal settlers and the most wealthy.

If SAPOA’s challenge succeeds, it could unravel the City’s fiscal framework, but failure to address ratepayers’ grievances risks further eroding public trust. As Cape Town navigates this legal and political quagmire, its leadership must balance infrastructure needs with the economic realities facing its residents.