News in South Africa 10th May:

1. New recycling levy:

The City of Joburg (CoJ) wants to charge all “affluent” households a levy of R50 per month from July to fund its separation-at-source recycling programme.

New recycling levy
Image taken by: Krizjohn Rosales

This proposal is part of its tariffs for 2021/2022 tabled in council in late March, with public comments closing on Saturday.

The “mandatory” programme is already in place as a trial in many of the northern suburbs and requires households to separate waste into two bags – a normal black bag and a separate clear bag (provided by the city) for recyclable items that is not placed in the Pikitup bin. These are collected separately by two separate fleets of vehicles.

The draft tariffs propose that “affluent households at various suburbs excluding those located in areas classified as township and informal settlements will be charged additional levy at an amount of R50 per month for all properties with a market value above R350 000”.

A house with a market value of R1 million already pays R235 a month for refuse collection (charges are on a sliding scale ranging from R141 to R368, depending on the value of the property).

This additional levy means that the proposed 4.3% increase in refuse removal charges from July will, in practice, be significantly higher. On a R1 million house, owners will now pay R295 in total (with the new levy and proposed increase) meaning an effective 26% increase in refuse removal charges.

The fundamental problem with this plan is that it attempts to address an issue that the market has already solved.

The (likely) tens of thousands of informal waste pickers who weave along the city streets with their trolleys each morning ensure that all recyclable items of value are removed from those clear bags.

2. Third wave ever closer:

Health minister Zweli Mkhize is maintaining a “no need for panic” stance but there are growing signs that a third wave of infections is already building.

SA has detected its first cases of a coronavirus variant initially identified in India, adding a highly infectious mutation of the Covid-19 virus just when some parts of the country are picking up early signs of a third wave of infections.

The National Institute for Communicable Diseases (NICD) said at the weekend that four cases of the variant — two from Gauteng and two from KwaZulu-Natal — have been found in individuals with a recent travel history to India.

The detection of the variant comes as some parts of Gauteng show early signs of a third wave, with the situation in the Sedibeng district, about 50km south of Johannesburg, particularly worrying. The risk, while still small, is rising in some subdistricts in Tshwane and Johannesburg.

The variant, known as B.1.617.2, has reached at least 17 countries, from Britain and Iran to Switzerland and the US, triggering global concern as experts worry it contains mutations that may give it an edge over the body’s immune defences.

The second batch of the commercial run of Covid-19 vaccines has arrived in South Africa, with 325,000 more Pfizer doses landing at the weekend. The vaccines will be arriving in batches of this size until the end of May.

The second phase of the vaccination programme is expected to start on 17 May. Experts have called for caution as two dangerous variants of the Covid-19 virus have been detected in South Africa – the variant first discovered in the UK, and the one first discovered in India. The Indian variant is already being transmitted at community level.

3. Ace still fighting:

Suspended ANC secretary general Ace Magashule remains defiant of the party’s order that he step aside, claiming that he is still in the position, despite being booted from the party’s NEC meeting this past weekend. Magashule says he is appealing the order, thus has not vacated the position.

Suspended ANC secretary general Ace Magashule’s supporters will try to mobilise structures to call for an early conference to elect a new national executive committee (NEC) in response to their loss of control of the party’s top leadership.

It is understandood that they will push party branches, regions and provinces to use rule 29 of the party’s constitution to call for an early elective conference on the grounds that the current NEC is deadlocked in implementing the party’s resolutions and has failed to lead.

This is in the face of a loss of support for Magashule within the NEC, which on Saturday removed him from its online meeting while his suspension over corruption charges was discussed.

One of Magashule’s key supporters, NEC member Dakota Legoete, told the NEC meeting that the committee, elected at Nasrec in December 2017, had become a “liability” to the country and to the ANC’s structures.

In a leaked recording, Legoete said the NEC had “failed to rise above narrow and factional agendas” and had spent the past four years “dealing with each other”.

Legoete said he believed the ANC needed to use rule 29 of its constitution and call a special conference to deal with this collapse of leadership as the party and the country were “on autopilot”.

4. Karpowership fights corruption:

A Turkish company threatened to switch off two floating power plants that provide about a fifth of Lebanon’s electricity, amid a dispute with authorities over corruption allegations and payments.

Lebanon’s Financial Prosecutor asked for Karpowership’s vessels to be seized pending an investigation into the renewal of the power supply contracts.

“We are alarmed at the actions taken by Lebanon’s Financial Prosecutor and firmly deny any violation of our contract or the law,” a Karpowership spokesperson said in a statement late on Saturday.

The company was owed around $100 million by Lebanon in July last year, and the figure has since risen. The government is struggling to pay suppliers due to the country’s economic meltdown.

Karpowership has urged the government to engage in talks and served a final notice that it will suspend its services, the spokesperson said. The Turkish firm’s ships provide 400 megawatts of power and have been anchored off Lebanon’s Mediterranean coast since 2013.

“We strongly urge the authorities and the Republic of Lebanon to respect legal and contractual obligations and, crucially, to ensure rule of law,” Karpowership said.

Karpowership is also mired in a dispute in South Africa. It won most of a government emergency-power tender to provide electricity for 20 years. But state utility Eskom is concerned about the cost and length of the contract.

5. Banks charging more:

South African banks say they have little choice but to charge extra for processing immediate electronic payments between clients of different banks. In a single year, banks process more than 49 million of these premium-rate transactions – but quite how much banks believe this extra computing power and risk should cost clients differs greatly. At the extremes, the difference between the cheapest and most expensive fees for these transactions is as much as R42.50, a difference of 147%.

There are currently just two prominent types of online interbank payment systems in South Africa – traditional electronic fund transfers or EFTs, which can take money up to two business days to reflect in another bank account, and so-called immediate, or real-time clearing (RTC), payments, which transfer funds into any bank account within 60 seconds.

On the surface, there’s very little difference in the complexity or technology required to process each type of electronic payment – but banks claim that this is not the case. Instead banks cite an increased risk of fraud associated with immediate payments, and in some cases legacy costs for developing the service, as the reasons that these bear a higher fee.

Quite how much more these payments should cost differs greatly, however. Some banks charge less than R10 for the privilege of immediate payment, while others still charge up to R50 for the same service.

According to PASA, South Africa pioneered the first interbank RTC payment system – founding members Absa and Capitec first implemented the service in 2006. Before this, real-time payment clearing was only available on an intra-bank basis.

Since 2006 most mainstream banks have adopted full RTC policies, which require inter-bank funds to reflect within just 60 seconds.

South Africans are also making more use of RTC payments. In 2019 the total value of all RTC transactions in South Africa topped R600 billion – with an average transaction value in that year just under R13,000 each, according to BankServ.

The volumes are impressive, too – in 2019 PASA says they increased by 60.2% to a total of 49 million real-time transfers.


All information sourced from articles posted by: BusinessTech, Business Insider, Moneyweb, BusinessLive, Mail & Guardian, and Fin24.

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