Tshwane budget sinks exemption application

The stand-off between the City of Tshwane and its staff over a 4.5% salary increase is set to drag on after an announcement that the city will take an adverse ruling by the local government bargaining council on review to the labour court.

Service delivery in Tshwane has since late July been seriously impacted by an unprotected strike by members of municipal union Samwu, who insist they are entitled to the increase, which was agreed upon in a three-year wage agreement concluded in 2021.

The agreement provided for increases of 3.5%, 4.9% and 5.4% in 2021, 2022 and 2023. The City of Tshwane did not implement the 3.5% increase in 2021 either and its exemption application also failed at the time. A review of that decision is still pending.

Violence and intimidation

The strike has been associated with violence and intimidation of city employees and contractors who want to work. Several refuge trucks have been set alight, which resulted in contractors withdrawing their service and heaps of refuse littering the city.

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Mayor Cilliers Brink has been standing firm, saying there is simply no money available for the increase, and even assisted refuse removal efforts at times.

He said on Monday the city is busy catching up with the waste removal backlog and the municipal bus service would resume on Tuesday.

According to Brink the strike is losing steam, presumably due to the city’s no-work no-pay approach.

Read: Tshwane boots 55 more workers in pay strike

Ruling 

In a ruling dated 10 September bargaining council senior commissioner Eleanor Hambidge accepted Samwu’s argument that the city’s 2023/24 budget allows for the increase.

Its wage budget amounts to R12.6 billion, while the actual expenditure on salaries and wages in the previous financial year was R11.4 billion. The difference is more than enough to cover the salary increase, which Brink said would cost more than R600 million.

Crucially, Brink earlier stated that the budget is unfunded – but was passed, together with a funding plan approved by National Treasury.

Budgets ‘unrealistically optimistic’

Lex Middelberg, councillor for the Republican Conference of Tshwane, slammed the multi-party coalition led by Brink for passing “unrealistically optimistic budgets it can never expect to meet”.

He argues that both review applications are bound to fail and says effecting the increases with interest will cost the city dearly.

“The 2021 salary increase (together with a consequential adjustment of the 2022 salaries) that will become payable later in the financial year, together with interest on the arrears, will be about R500 million.

“The salary adjustment for 2023 was set at R602 million as per the application, but that did not factor in the adjustments needed for the 2021 lost exemption application.

“After adjustment, plus interest to the end of the financial year, this amount will top R700 million,” says Middelberg.

“The total cost of this matter so far, for which the city must by law carry a provision for contingent liability (but [does] not) thus stands at about R 1.3 billion.”

Refuse removal

In the meantime civil rights group AfriForum is questioning why residents must continue to pay for refuse removal that is not taking place. The organisation collected thousands of bins last week in Garsfontein, Moreleta Park and Pretoria West.

AfriForum is telling residents they are within their rights to inform the city they will no longer make use of the municipal refuse removal service, but rather appoint a private contractor.

According to AfriForum advisor on municipal matters Petrus Coetzee the Tshwane by-law provides for such a course of action.

The resident must provide sound reasons, but under the current conditions this won’t be difficult. It further requires the city’s approval, but Coetzee argues it would be unreasonable for the city to withhold such.

Private refuse removal ‘better, cheaper’

Dirk van Niekerk, MD of The Waste Group, which specialises in waste management, says the private sector can provide the same service profitably at half the cost. He says the city rents refuse trucks at exorbitant prices and pays contractors per hour, rather than per service point.

Working slowly therefore benefits the contractor, as does driving long distances to dumping sites.

Losing a substantial portion of its waste management revenue could further impact the city’s already empty purse. Its income from waste management in the previous financial year was R1.3 billion, which is 3% of its total income.

The municipality, however, says residents’ payments are based on the volume of refuse removed, not on the number of times per month. Even if refuse removal is delayed, the service will be rendered, and the municipality is entitled to payment for this.

Several parts of the city are subjected to delays of more than a week, but the backlog is being addressed.

The city sees the strike as something outside of its control and on which it contractually calls force majeure.

It states that only municipal officials or someone authorised by the city may provide the refuse removal service.

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