Economist Omu Kakujaha-Matundu has warned that an increase in rates and taxes will place a heavy burden on Windhoek residents.
The senior University of Namibia lecturer stressed that during the prevailing times of Covid-19, the city should rather consider cutting its own costs before thinking of hiking
rates.
“Hiking rates may not be productive as it could only lead to higher default rates and lower revenue for the city. Consumers are now placed under a power press, and will be squeezed more and more,” he reasoned.
Kakujaha-Matundu said many families are struggling to support those who lost their jobs due to the Covid-19 pandemic, and this added burden of proposed increased tariffs would send many families hungry to bed. The future will thus be a painful one, he added.
The chairperson of the city’s management committee Fillemon Hambuda stated during a recent budget presentation that the council is not generating enough revenue from tariffs to cover its operating and capital expenses.
He said for the 2021/2022 financial year, the majority of tariffs have not been increased.
The city, however, anticipates increasing some tariffs.
The electricity tariffs will be amended once the regulator, the Electricity Control Board (ECB), pronounces itself on the operating and reporting manual to be submitted.
“For the budget, a 5% tariff increase for electricity was applied for. The water tariff adjustments are still under consideration, and will be adjusted pending communication from NamWater. And for sewerage, no tariff increase was proposed,” he outlined.
Hambuda added that on the refuse removals and solid waste charges, a 5% tariff increase was proposed while for property rates, no tariff increase was suggested. For bus services, increases of 7% and 6% for smartcard fares and cash fares were proposed, respectively.
Furthermore, the chairperson said the current strategic plan will come to an end in 2022, and the municipal council will start with the drafting of the new strategic and transformation plan in 2021. This will speak to residents’ needs, especially those in the informal settlements, but also focusing on financial sustainability.
The total budget of the council amounts to N$4.9 billion for the 2021/2022 financial year. Of that amount, N$507 million is for capital projects and N$4.4 billion is for operating expenditure, including the maintenance of existing infrastructure.