TARIFF BACKLASH: NMB leadership accused of ‘extorting’ ratepayers as controversial budget passes amid service delivery failures

The Nelson Mandela Bay Municipality’s new budget, featuring steep tariff increases, faces backlash from residents and councillors amid persistent service delivery failures and mismanagement accusations.

Nelson Mandela Bay’s DA councillor and budget and treasury spokesperson Brendon Pegram says the municipality could have reduced its rates tariff by as much as 24% had it tackled the R863-million loss in its troubled electricity department – but instead the council voted to pass the steepest package of tariff increases in eight years.

Pegram argued that the municipality had not made a sufficient attempt to curb non-technical losses – electricity lost to theft and illegal connections – that were bleeding the department dry.

Addressing those losses alone, he said, could have allowed the City to reduce its rates tariff by almost a quarter.

The vote follows weeks of controversy after the National Treasury found that an earlier version of the budget was unfunded, forcing the municipality to revise its revenue and expenditure projections before resubmitting it for approval.

The budget was supposed to be adopted by 31 May, at least 30 days before the start of the new financial year. However the Municipal Finance Management Act (MFMA) provides mechanisms for municipalities to address situations where a budget has not yet been approved by the council before the start of the financial year on 1 July.

Nelson Mandela Bay mayor Babalwa Lobishe said she welcomed the adoption of the 2026/27 budget by the council following a robust democratic process that included extensive public participation, engagements with stakeholders, and careful consideration of the City’s financial realities.

Lobishe said the tariff increases were driven by National Treasury guidelines, escalating bulk service costs, inflation, infrastructure maintenance requirements and the need to keep the municipality financially sustainable.

She said the municipality was mindful of the pressure on household finances, and that the budget sought to protect vulnerable residents through indigent support programmes and targeted social interventions.

“A municipality cannot spend money it does not have. The National Treasury requires municipalities to adopt credible, funded budgets that balance the needs of residents with the financial sustainability of the institution. Our responsibility as council is to protect both current service delivery and the future of the City. This budget seeks to do exactly that.

“That is precisely why we have worked to ensure that support mechanisms remain available for qualif