The Durban Chamber of Commerce and Industry (DCCI) has expressed concerns over the eThekwini Municipality’s proposed tariff increases for 2026/2027, citing the potential negative impact on businesses in the area. According to Palesa Phili, CEO of the DCCI, the proposed tariff increases, which include a 15% residential water price rise and a 16% increase for businesses, cannot be justified considering the current state of service delivery and economic conditions.
The municipality’s draft budget for 2026/2027 comprises a capital allocation of R5.9 billion and an operating budget of R68.8bn, with significant investments in infrastructure and service delivery. However, the DCCI believes that more can be done to eliminate wasteful expenditure and deploy financial resources towards priority areas. As stated on the National Treasury website, effective financial management is crucial for local governments to deliver services and promote economic growth.
Tariff Increases Exceed Inflation
The proposed tariff increases exceed inflation, which will negatively impact the cost of doing business in Durban. Phili stated that tariffs must be significantly reduced to prevent businesses from disinvesting or considering more lucrative and cost-effective investment destinations. The DCCI recognises the progress achieved through the work of the municipality, supported by the Presidential eThekwini Working Group (PeWG), in strengthening infrastructure, tourism, business confidence, and safety and security in Durban.
Support for SMMEs
The DCCI welcomed the introduction of a 14-day SMME payment cycle, which is a progressive step that will enable small enterprises to utilise their resources more efficiently, particularly under current economic pressures. However, the DCCI emphasises that SMMEs remain the backbone of the economy and more comprehensive support is needed to ensure their growth. Some of the key areas that require attention include:
- Access to finance and markets
- Business development and training
- Regulatory support and compliance
As the eThekwini Municipality continues to navigate the challenges of balancing its budget, it is essential to consider the impact of tariff increases on businesses and the broader economy. The DCCI will continue to engage with the municipality to ensure that the interests of businesses are represented and that the city remains an attractive investment destination.
