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Price hikes choke South Africans

This week’s fuel price hike, which has had a domino effect on food and transport costs, is making the lives of hundreds of thousands of South Africans unbearable, with some opting out of employment because they can no longer afford to commute to their workplaces.

Fuelled by global conditions that have been exacerbated by the fallout from Russia’s invasion of Ukraine, South Africa’s headline consumer price index (CPI) exceeded the SA Reserve Bank’s upper target limit of 6% and hit 6.5%.

This is the highest since 2017 at the tail-end of former president Jacob Zuma’s tenure.

Economists said this week that inflation not only affected households, but had a significant impact on operating costs for farmers – especially small-scale ones, who might buckle under the pressure and give up farming as they struggled to pass on the added costs to consumers at a rapid enough scale to sustain their ventures.

Senior FNB economist Paul Makube said:

The culprit here is the higher crude oil price, which has an impact on the fuel and fertiliser prices. The increase in the crude oil price automatically means that there’s increased pressure on the price of fertiliser, which is also imported.

HOPELESSNESS, FEAR AND ANGER

South Africans interviewed by City Press this week described their feelings of hopelessness, fear and anger, which cut across class and educational status.

A father said his children might be told to leave school because he could no longer pay its fees; a childminder said she had decided to quit work because there was no point in carrying on; while a domestic worker and a deputy school principal were both reconsidering their options in terms of their jobs.

When domestic worker Matshidiso Lehana moved to Johannesburg in 1993, she paid R3 to take a taxi from Soweto to the Johannesburg CBD. Today, the same trip costs her R25.

In the 1990’s a litre of petrol and diesel averaged just over R1

This week, a litre of petrol increased to just over R26, while diesel costs R25.25 per litre in inland provinces and R24.93 at the coast. The price of 95-octane unleaded petrol has gone up by about 25% since January. Over the past 12 months, the petrol price has gone up by about 32%, representing an increase of about R500 in fuel costs for the average household, which spends about 5% of its income on fuel.

R1 800 IN TAXI FARE FROM A R2 000 SALARY

The ever-increasing price of fuel, which has a direct impact on the cost of living, has made Lehana question whether she should continue working or simply quit. She earns just over R2 000 a month and must now budget for about R1 800 a month in taxi fares.

She is not alone in this misery. Nontando Radebe has decided to quit her job as a childcarer at an orphanage at the end of this year. She earns R2 400 a month and says transport costs have made it unsustainable for her to continue working. It costs her just over R1 000 a month to travel from Protea Glen in Soweto to Braamfontein, Johannesburg, where she is employed. This leaves her with just R1 400 to cover all her other expenses.

Radebe says:

I’m working only for transport [money] because I’m left with nothing at the end of the month. I feel that it’s a waste of time. I’d rather stay at home, which is why I’ve decided to move back to the Eastern Cape at the end of the year. What’s the point of working, really?

Uber Eats driver Linycolin Ngundani fears the prospect of having his two little girls go to bed with empty stomachs because he cannot generate enough income to keep his family fed.

The continual increases in the petrol price forced him to consider leaving the ride-hailing business. He says profits have dropped significantly, as the bulk of the revenue is consumed by what it costs him to reach his various destinations. Since the latest petrol increase on Wednesday, he spends more than half of what he earns on petrol.

“Out of the R1 000 I make a week, R650 (in a busy week) goes towards fuel. I end up taking a meagre R350 home to my family of four, who depend on me. When petrol was a lot cheaper, about three years ago, I took home more than R2 000 from a busy week,” he says.

Ngundani says he can longer afford to pay preschool fees for his daughters:

One of these days, I’ll come back home to the sad news that my kids have been chased away from school. That’s my biggest fear at the moment.

When she started working in Soweto in 2016, Salome Maleka spent R900 on petrol per month travelling from Krugersdorp to Orlando, where she is a deputy principal of a primary school.

Before petrol prices went up on Wednesday, a full tank of fuel set her back R800 a week, but she anticipates that she will now pay R1 000.

Maleka says:

I’ll have to budget R4 000 a month just to be on the road. That’s quite steep and more than I can handle. It’s biting me badly.

She adds that she is considering transferring to a school on the West Rand because working in Soweto no longer makes sense, but that is also not an easy process.

Cape Town taxi owner Sindiswa Melani says being in the taxi business no longer makes much sense. A full tank of petrol for a Quantum minibus costs about R1 600 and, depending on the route, some drivers only make a profit of R1 000, as the rest of the money goes to fuel.

HIKES SPUR PROTESTS

This week, the national executive committee of the SA Federation of Trade Unions announced a planned national shutdown in response to the economic crisis in the country, saying “petrol prices have now reached unprecedented levels”

The announcement came after taxi drivers protested in Mbombela, Mpumalanga. They used trucks to block roads, including the N4 highway, which links South Africa to Mozambique. Fifteen taxi drivers were arrested following the protest.

Announcing the fuel price hike this week, the department of mineral resources and energy also announced a 75c per litre temporary reduction in the general fuel levy until August 3.

This will not be the first reduction to the fuel levy: there was one of R1.50 that was in place from June 5 to the beginning of this month, but it did very little to relieve the burden South Africans are feeling.

Meanwhile, the DA has called the fuel price hike “criminal”. The party has since submitted a fuel price deregulation bill to Parliament to amend the Petroleum Products Act.

The DA believes that if legislation is introduced to deregulate and reduce fuel costs, it will bring relief to South Africans, as all retailers will compete to offer lower prices.

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