Endumeni’s draft budget reflects a balancing act as the municipality tries to maintain essential services amid rising debt and widespread electricity theft.

Tariff changes loom as financial pressures mount

Electricity theft alone has cost the municipality more than R58-million between July 2025 and March 2026, while the bad debt reserve now exceeds R18-million.

Mayor Mcebo Mkhize said the ability of residents to pay for services is declining, placing further strain on municipal finances.

Although tariff increases have been kept relatively low – with rates up 3.4%, refuse removal 2.13% and electricity 13.7% – proposed seasonal electricity tariffs are expected to place added pressure on businesses and bulk users.

The proposal would see commercial, industrial and government customers paying up to 50% more than the summer rate during winter months.

Mkhize said extensive consultation with the business sector and other stakeholders would be needed, especially after a similar proposal last year was scrapped following strong opposition.

He explained that the increase is linked to Eskom’s higher winter tariffs charged to municipalities.

“The demand for services continues to rise, but weak economic growth has reduced residents’ ability to pay. The budget reflects difficult choices and prioritisation,” he said.

The draft budget totals R634-million, with R34-million allocated to capital projects and R109-million coming from government grants.

Employee costs account for R166-million, or 35% of the budget, while ongoing challenges include Eskom debt, non-payment for services and ageing infrastructure.

Only R16-million, or 2% of the budget, has been set aside for maintenance – well below the National Treasury recommendation of 8% – with further cuts expected in future budgets.

Other allocations include R10.8-million for security, R1.5-million for disaster assistance, R840 000 for ward projects and R300 000 for youth development.

Funding for the Dundee July event has also been reduced to R300 000, down from the usual R500 000.