Today’s Latest Daily News
The Department of Mineral Resources and Energy announced fuel price hikes across the board.
There is little in the way of festive cheer for South Africans this year. Besides the rampant spread of the new Covid-19 variant – Omicron – plunging the country deep into a fourth wave, economic conditions are worsening, putting even more of a squeeze on consumers’ pockets, particularly the poor.
The fuel price increase in the past week pushed the cost of a litre of petrol well beyond the R20 level, and came on top of a brutal increase the previous month. Diesel and paraffin were not spared, also rising to record levels.
READ: ‘Catastrophic’ rise in petrol prices pushes up SA inflation
While the increase was initially tapped at 81c/litre, government conceded that it had made an error in calculation and the increase was reduced to 75c/litre.
This is cold comfort at a time when many South Africans want to travel home to celebrate Christmas, to be with family or to go on holiday.
The bad news doesn’t end there. A rise in fuel costs leads to a rise in the cost of goods that are dependent on transport to reach their destination. The average cost of a food basket is already 6.5% higher than it was a year ago, and this trend will continue its upward trend.
This trajectory is not sustainable. Government cannot keep piling increases on consumers. Using taxes as low-hanging fruit to bolster the fiscus is counterproductive. As it stands, 30% of the fuel cost is made up of taxes.
The country’s dire jobless growth statistics – in which the economy is reflecting subdued GDP growth but is adding no jobs, in fact, the unemployment rate is worsening – is a deepening crisis. There is only so much a populace can be expected to endure.
READ: Food prices squeeze the poor
In these dire circumstances, save as much as you can, cut unnecessary expenditure, plan budgets carefully and, if you can donate to help the poor, do so – we are all in this collective bind, some just experience it on a deeper level than others.