Local Government: Municipal Finance Management Act, 2003 (Act No. 56 of 2003)Chapter 5 : Co-Operative Government42. Price increases of bulk resources for provision of municipal services |
| (1) | If a national or provincial organ of state which supplies water, electricity or any other bulk resource as may be prescribed, to a municipality or municipal entity for the provision of a municipal service, intends to increase the price of such resource for the municipality or municipal entity, it must first submit the proposed amendment to its pricing structure— |
| (a) | to its executive authority within the meaning of the Public Finance Management Act; and |
| (b) | to any regulatory agency for approval, if national legislation requires such approval. |
| (2) | The organ of state referred to in subsection (1) must, at least 40 days before making a submission in terms of subsection (1)(a) or (b), request the National Treasury and organised local government to provide written comments on the proposed amendment. |
| (3) | Any submission in terms of subsection (1)(a) or (b) must be accompanied by— |
| (a) | a motivation of the reasons for the proposed amendment; |
| (b) | an explanation of how the amendment takes account of— |
| (i) | the national government’s inflation targets and other macroeconomic policy objectives; |
| (ii) | steps taken by the organ of state to improve its competitiveness or efficiency in order to reduce costs; |
| (iii) | any objectives or targets as outlined in any corporate or other governance plan applicable to that organ of state; |
| (c) | any written comments received from the National Treasury, organised local government or any municipalities; and |
| (d) | an explanation of how such comments have been taken into account. |
| (4) | The executive authority of the organ of state must table the amendment and the documents referred to in subsection (3) in Parliament or the relevant provincial legislature, as may be appropriate. |
| (5) | Unless approved otherwise by the Minister, an amendment to a pricing structure which is tabled in Parliament or the relevant provincial legislature— |
| (a) | on or before 15 March in any year, does not take effect for the affected municipalities or municipal entities before 1 July in that year; or |
| (b) | after 15 March in any year, does not take effect for the affected municipalities or municipal entities before 1 July the next year. |