The City of Cape Town will publish proposed amendments to its tabled 2026/2027 Budget for public comment following the Western Cape High Court’s ruling on its tariff structures, including moving city-wide cleaning costs back into property rates with fixed water and sanitation charges reverting to water meter connection size.

The municipality is also proposing a further raise to the rates-free rebate for the first R620 000 of a property’s value, up from R450 000, for residential properties under R8 million.

Mayor Geordin Hill-Lewis says the key impact of the court ruling is that water and sanitation fixed charges will go up for many families in lower- and middle-value residential properties – and go down for higher value properties.

“While we adjust for the impact of this ruling, we remain concerned about its implications for the ability of municipalities to equitably cross-subsidise in utility tariffs in the South African social context. We will engage the National Treasury and Co-operative Governance departments nationally to seek regulatory clarity on available options for municipalities to equitably cross-subsidise lower- and middle-income households,” he adds.

Moving city-wide cleaning costs back into property rates will remove the charge as a standalone item on bills and increase property rates for residential customers – changing the -10.2% reduction tabled in March. Commercial property rates will also increase while electricity unit costs will reduce to the phased reduction of the surcharge contribution to city-wide cleaning. Residential electricity tariffs will remain unchanged as these customers no longer contribute to city-wide cleaning in this way, says the municipality.

The City is proposing to return to charging fixed water and sanitation fees based on meter size rather than property-value bands by consolidating the fixed tariff for all meter sizes up to 22mm and shifting costs towards higher consumption uses compared with the March tabled budget.

The proposed amendments will be published for comment in a supplementary public participation process between the 27^th of May and 10^th June 2026.

In response to the City of Cape Town’s proposed amendments to its 2026/2027 Budget, SAPOA’s CEO, Neil Gopal, says the association is glad to see that the City has decided to abide by the court’s decision and that it has decided not to waste further taxpayers’ funds in pursuing fruitless appeals.

“SAPOA notes the City’s undertaking to publish a new draft Budget for public comment and will consider such draft Budget in detail. We will carefully study the new draft Budget and will submit comment where necessary. As SAPOA has stated all along during its engagement with the City, city-wide cleaning ought to be funded from property rates, and SAPOA is satisfied that the City now seems to agree.”

“We urge all other municipalities in the country to refrain from introducing tariffs linked to property values. SAPOA is currently engaging the Mangaung Municipality on precisely this issue, and we sincerely hope that Mangaung will pay heed to these calls.”

“We are now proceeding to recover its legal costs incurred in the litigation from the City.”