School fees could soon soar if the City of Johannesburg’s new rate hikes hold

(Getty Images)

(Getty Images)

  • The City of Johannesburg has reclassified school properties, resulting in huge rate increases.
  • These property rate hikes will result in school closures, warn the City’s critics, and those that manage to stay open will be charging much higher fees.
  • The City is defending its decision to increase rates eight-fold in court, and in the meantime, schools slapped with huge bills aren’t being forced to pay.

The City of Johannesburg’s sudden decision to reclassify school properties, thereby raising payable rates eight-fold, will have a devastating impact on pupils in the metro, according to organisations challenging the change.

Every year, the Gauteng Department of Education is faced with a scramble to place pupils in schools, with many missing out on valuable first-term time because of backlogs. As the 2022 school year got underway, more than 1,400 Grade 1 and 8 pupils were yet to be allocated a spot.

Schools in the province, and particularly those in Johannesburg, are set to become even more overwhelmed if recent changes to educational institutions’ property classifications are upheld. Schools that can absorb these massive rate hikes will almost certainly raise their fees to compensate, while many won’t be able to keep their doors open, explained Anne Baker of the National Alliance of Independent Schools Associations (NAISA).

“Further to that [rising school fees], the concern is that some schools will have to close. Parents will not be able to sustain an increase that would be required,” Baker told Business Insider SA.

“The big thing that worries us is the effect on the children, especially in the low-fee and medium-fee schools. The Gauteng [education] system is under pressure all the time, and we know that the State has to take in any child, so if a school closes, the State is obliged [to place those children] but whether there will be space is another issue.”

Independent schools cited by Baker were caught completely off-guard when receiving their rates bills in July, noticing massive increases with no prior consultation.

Baker gives an example of an independent school in Soweto which was previously paying R7,000 per month and was recently billed for almost R64,000, representing an eight-fold increase. Similar hikes have also hit other schools.

The reason for these massive rate hikes lies in the City of Johannesburg’s decision to reclassify schools as businesses.

Previously, schools had been categorised as educational properties. Most schools under the NAISA umbrella are classified as Public Benefit Organisations – not regarded as businesses – and have benefitted from rates exemptions. The decision to scrap “education” as a property classification and impose new rates for “public service properties” will also extend to public schools and tertiary education institutions.

Despite the outcry, the City of Johannesburg is defending its decision to reclassify educational properties in court. The legal battle to have the City of Johannesburg’s rate hikes put aside is being led by AfriForum and JSE-listed education group ADvTech.

“AfriForum hopes that the case which will be heard in October will bring permanent clarity on the matter and relief from the new excessive tariffs,” said Alana Bailey, AfriForum’s head of cultural affairs.

“If this does not happen, there is a risk that some of the institutions will have to cut back on the quality of their services and tuition, or some may even have to close their doors, steps that will be to the detriment of everyone in Johannesburg and, in fact, in South Africa.”

While the legal tussle continues, the court has ordered that pending the determination of the applications, the City of Johannesburg will not take any credit control action in relation to any increased rates contained in its 2022/23 rates policy in respect of any private or public educational institution within its jurisdiction before 1 November 2022.

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