The GOOD Party is procuring legal advice on the appropriate next steps to force the City of Cape Town to comply with last week’s Western Cape High Court finding that its fixed tariff regime is unlawful, and to return overcharges to residents.

The court found that the charges, which were calculated using property value bands rather than actual service consumption, violated the Constitution, national legislation, and the City’s own tariff policies, and set all three aside with effect from 30 June this year.

The charges at the centre of the dispute were a city-wide cleaning levy, a fixed water charge, and a fixed sewerage charge introduced by the City last year, subsequently challenged in court by the South African Property Owners Association (Sapoa) and later AfriForum. The GOOD Party was granted leave by the court to intervene in the application.

READ ALSO: Western Cape High Court rules City of Cape Town’s fixed charges unlawful

“While the court was clear on the unlawfulness of the City’s fixed cleaning, water, and sanitation tariffs, setting them aside prospectively from 30 June 2026, the consequence remains unresolved. A very significant amount of money was collected from residents under the unlawful regime over the past year,” GOOD secretary-general Brett Herron said in a statement yesterday.

Public funds to appeal?

Following the judgement last week, the City confirmed it will analyse the ruling and model its potential impact on ratepayers, particularly lower- and middle-income households, before deciding on its next legal steps. Crucially, should the City proceed with an appeal, the order will be suspended in the interim, the City noted.

Mayor Geordin Hill-Lewis said the point of using property values to determine fixed charges was to protect lower- and middle-income homes, and that the only alternative that remains is for everyone to pay a flat charge regardless of whether they are low-income or affluent. The implication thereof, he said, might be that fixed charges go up for many families and go down for more affluent families.

Herron noted Mayor Hill-Lewis and his administration’s suggestion that the City spend more public funds to appeal the judgement, saying that his party is therefore examining legal options, including a cross-appeal, a further application for just and equitable relief, or both.

“The party did so because the unlawful tariff scheme targeted groups of people for extra payments they simply cannot afford, including those who have inherited property or whose property values have escalated exponentially due to gentrification or development. If the Mayor were allowed to charge residents whatever he wishes, it would effectively force members of these groups to consider downgrading their accommodation – the diametric opposite of development,” Herron said.

Ruling ‘not anti-poor’

Herron warned that ratepayers must not be fooled by the Mayor’s framing of the court’s ruling as anti-poor. “The fact is that the unlawful tariffs do no favour struggling families and offer them no breaks,” he said.

“Ratepayers must also be clear that the City is not compelled to continue defending its unlawful position, though it has practically limitless ratepayer-funded legal resources at its disposal. The obvious risk of appealing and continuing to apply the unlawful fixed charges into the next financial year, and possibly beyond, is that if the judgement is confirmed on appeal, the amount the City will owe the people of Cape Town will be substantially more.”

He also stated that Hill-Lewis’s suggestion that the only alternative to his unlawful tariff model is a flat charge for everyone is false.

“It is a political scare tactic, not a legal or policy reality. Hill-Lewis is not a king, for whom the legality of his policies and practices is of no significance. Residents are entitled to honest billing, lawful tariffs, and accountability for charges already imposed on them, not political spin, ill-thought-through overcharges, and manufactured crises.”

Nersa ruling awaited

In addition to the Western Cape court’s ruling, Herron referred to the Gauteng High Court’s judgement in the matter between Cape Town and the electricity regulator, Nersa, which is eagerly anticipated.

“Should the Gauteng court find Cape Town’s decision to charge tariffs above those set by the regulator unlawful, these overcharges, too, must be reimbursed to residents,” he concluded.

According to Jurie Ferreira, AfriForum regional head for the Southern Region, last week’s ruling confirmed that tariff structures must be transparent, rational, and legally justifiable, and that AfriForum will continue to ensure that the court’s decision is correctly implemented.

AfriForum argued from the outset that the City of Cape Town’s approach – to charge tariffs based on the value of a property – is unfair and unlawful.

“There is no rational relationship between water usage and the value of a property, and the court has now confirmed that tariff models that follow this approach act unfairly and unlawfully,” Ferreira said.

Broader implications for municipalities

Morné Mostert, manager of local government affairs at AfriForum, emphasised that the ruling specifically concerns the application of this tariff model in the City of Cape Town, but that the decision also has important implications for municipalities in the rest of the country.

“Municipalities across the country will now have to re-evaluate their tariff structures based on the clear standard that the court has now set, namely, that tariffs linked to consumption are not optional but a legal requirement,” Mostert said.

“This ruling comes at a crucial time in the budget cycle. It forces not only the City of Cape Town but also all municipalities to correct their approach to the setting of tariffs. The principle is straightforward: you only pay for what you use, nothing more.”