Joburg proposes 13.9% water tariff hike, sparking backlash and concern

Protesters chant slogans at a protest at the Johannesburg City Council's interim budget meeting in Braamfontein on 27 February 2025, calling on Joburg Water to fix collapsing infrastructure. (Photo: Gallo Images / Sharon Seretlo)

By Julia Evans

10 Apr 2025

A proposed 13.9% increase in water and sanitation tariffs for the 2025/2026 financial year has led to warnings of the potential strain on already stretched household budgets.

Johannesburg residents are bracing for a steep hike in water and sanitation tariffs, with the proposal of a 13.9% increase for the 2025/2026 financial year, well above the current inflation rate of 3% to 6%. The proposed hike has drawn concern from residents and advocacy groups who warn that such increases could place unbearable pressure on already struggling households.

Dr Ferrial Adam, executive manager of WaterCAN – a civil society organisation under the Organisation Undoing Tax Abuse (Outa) – said the scale of the proposed hike was deeply concerning.

joburg water tariff Protesters chant slogans during a protest at the Johannesburg City Council's interim budget meeting in Braamfontein on 27 February 2025, calling on Joburg Water to fix collapsing infrastructure. (Photo: Gallo Images / Sharon Seretlo)

“While we understand the financial pressures faced by municipalities, this scale of increase is simply not sustainable for many households, particularly low-income communities that are already struggling with the high cost of living,” said Adam. “For many families, this isn’t just a budget line item. It’s a matter of health and dignity.”

“People will be forced to make impossible decisions about how much water they can afford to use,” she said. “That means less water for drinking, cooking, and hygiene – with serious consequences for public health.” She used Cape Town’s drought crisis as an example, where reduced water use led to a decline in hygiene standards across many households.

As Bheki C. Simelane reported for Daily Maverick last week, Joburg Mayor Dada Morero acknowledged that, “Households are already under immense financial strain. I am more than alive to the fact that every rand matters, and we must do everything possible to alleviate financial pressures on our residents.”

Read more: Mayor Morero faces backlash over proposed tariff hikes as financial strain deepens in Joburg

However, Morero said there were constraints imposed by bulk water supplier Rand Water, which proposed a 15.8% water tariff increase, and Eskom’s 12.74% price increase. He maintained that the city’s proposed tariffs remained below these recommendations.

Adams responded, “We understand that the government needs money for water and sanitation – but placing the burden on people is not the way to go. The government always pleads poverty, but there is money – they just need to use it better.”

Joburg Water told Daily Maverick that the proposed tariff increases were intended for cost recovery, primarily driven by Rand Water’s proposed 15.3% hike and The National Electricity Regulator of South Africa’s (Nersa’s) approved 12.74% electricity tariff increase.

In response to concerns about the above-inflation tariff increase, Rand Water emphasised its need to finance infrastructure through tariff revenue and capital markets as a self-sustaining entity under the Public Finance Management Act.

The utility told Daily Maverick that costs of raw water, sourced from the Department of Water and Sanitation and the Trans-Caledon Tunnel Authority, had risen sharply, comprising 39% of Rand Water’s expenses.

Energy costs, crucial for pumping water to elevated areas, accounted for more than 29% of its cost structure, exacerbated by Nersa’s energy tariff increment. Rand Water also highlighted non-revenue water losses in municipalities, where more than 45% of potable water was lost. To assist with repairs, Rand Water collects an additional 1%.

Rand Water said it was pursuing long-term solutions to mitigate future cost increases, including chemical optimisation, self-sufficiency in chemical production and energy generation from its pipe network.

Ringfencing strategy

In a bid to address the critical water infrastructure and management challenges, the Johannesburg City Council has approved a comprehensive turnaround strategy for Johannesburg Water in line with the National Treasury’s Trading Services Reforms.

Read more: Joburg Water’s turnaround strategy: Can it secure the R3bn needed to address the crisis?

One of the most significant aspects of the strategy is ring-fencing revenue. Joburg Water intends to reinvest revenue, profits and cash generated from water and sanitation services back into the water business, specifically targeting infrastructure.

When asked why such steep tariff increases were necessary considering the turnaround strategy, Nombuso Shabalala, spokesperson for Joburg Water, explained that the ringfencing strategy aimed “to improve the financial sustainability of the entity and ensure that revenues are efficiently channelled toward essential services, including covering infrastructure costs”.

“The strategy is meant to build financial resilience by allowing the utility to operate with a greater degree of autonomy and accountability for its income and expenditure streams,” Shabalala said, noting that ringfencing ensured that funds generated from water and sanitation services were reinvested directly into those services, rather than being absorbed into the broader municipal budget.

Shabalala said the tariff increments supported this autonomy by ensuring that Joburg Water charged tariffs that reflected the cost of providing the service, thereby ensuring the entity’s financial sustainability.

Public participation, next steps

The City of Johannesburg has tabled its proposed municipal tariff increases for the next three years as part of the municipality’s integrated development plan (IDP) for the 2025/26 financial year. A total budget of R87.6-billion has been proposed, allocating just over R80-billion for the operating budget and R7-billion for capital expenditure. Johannesburg Water will receive R5.32-billion over the next three years, while City Power will receive R5.26-billion over the same period.

The proposed fees will not be finalised until after a public participation schedule, running from 29 March until 10 May.

When asked what would happen if public participation overwhelmingly disagreed with the proposed tariff increases, City of Johannesburg spokesperson Virgil James responded, “I cannot pre-empt the outcome... Let’s wait for the final draft IDP for council approval.” He pointed out that the city had already reduced rates to 4.6% from 5.6%, electricity to 12.51% from 12.73%, plus there were no increases to electricity availability charges.

Social packages

Dr Adam also raised concerns about the accessibility of Free Basic Water (FBW): “Government always pleads poverty but there is money – they just need to use it better … but if you look at the number of households registered for FBW it is far lower than the estimated number of people that qualify for FBW.”

Regional manager for JoburgCAN Julia Fish highlighted discrepancies between figures obtained from National Treasury, the Office of the Auditor-General and the City of Johannesburg Annual Report on the number of households receiving an FBW package.

“It can be assumed that the [City of Johannesburg] is deliberately keeping the indigent register numbers low to redirect that grant to the city’s budget,” said Fish.

“The claims that residents unable to afford the new prepaid R230 tariff network fee would be exempt and protected by the indigent register were grossly overstated, as many who qualify for FBW are left in the dark.”

According to the Auditor-General’s findings, the city is providing 140,329 households with free basic services against a treasury funded package to assist 1.1 million households, costed by National Treasury for 2024/25 at R567.12 per household per month, a total cost to the city of R884.707-million, which is less than 12% of the city’s equitable share grant.

The city said “the discrepancy arises due to different definitions of indigent households”, said Fish.

“National Treasury’s number is based on the broader equitable share calculation, while the city’s IDP focuses specifically on households living below the lower-bound poverty line.

Fish said, “The city’s Expanded Social Package operates using a means-tested system based on the [City of Johannesburg] Poverty Index, which provides more targeted assistance. The city offers assistance to qualifying individuals based on poverty scores. Households receive subsidies for water, electricity and rates depending on their poverty score band.”

The City of Johannesburg offered bands up to 30kwh of electricity, not the maximum of 50kwh in its response, which is not in line with its Extended Social Package policy.

Maureen Mnisi, the Democratic Alliance proportional representative councillor responsible for several Joburg South wards including Protea South, Thembalihle, Lawler station and Phumla Mqashi, described the proposed increase as “nothing short of a direct assault on the people of Johannesburg – especially the most vulnerable”.

She said the increases would exacerbate hardship for unemployed and underpaid residents, forcing them to choose between basic necessities.

Mnisi called for efficient management, reduced expenditure and accountability for corrupt officials.

“We stand with every resident who is tired of being asked to pay more while receiving less. This is not just bad governance – it’s injustice.” DM

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Ringfencing strategy

Public participation, next steps

Social packages