The fuel levy relief that South Africa’s motorists have been enjoying for the past few months is set to end in July, prompting civil rights organisations and trade unions to call for its extension.
AfriForum, representing more than 300,000 members and the Congress of South African Trade Unions (Cosatu), South Africa’s largest trade union federation, are among the biggest voices calling for further relief.
Earlier this week, the civil rights organisation called on Finance Minister Enoch Godongwana to make the temporary fuel levy cut permanent.
“AfriForum now urges the minister to make this fuel levy cut permanent, which would be the ideal move, or to at least extend its implementation period considerably, seeing as oil prices remain high and further shocks in the near future are very likely,” it said.
The organisation’s public relations head, Ernst van Zyl, noted that the temporary nature of the fuel levy relief risks simply postponing the pressure South African consumers are facing.
“The situation in the Middle East remains at a knife’s edge, and one would be naïve to think the global economy is out of the woods,” he said.
“Major price shocks are still a very real risk. It’s the government’s responsibility to help consumers and the economy avoid this pain as effectively as possible and not simply to postpone the impact for a short while”
In AfriForum’s letter, Van Zyl notes that oil prices remain high, and further shocks in the near future are “very likely”.
As a result, the temporary relief merely “kicks the can down the road”, rather than helping consumers and the economy avoid the worst of the ongoing global energy crisis, he explained.
Should the Finance Ministry not cut the fuel levy entirely, Van Zyl offers an alternative solution.
“The second-best alternative would be to cut the fuel levy for an extended period of time beyond 1 July,” he suggested.
Fuel prices raise the cost of living in South Africa
South Africa’s consumer inflation rose to 4.5% in May, up from 4.0% a month prior, marking the highest annual rate since July two years ago, when inflation stood at 4.6%.
According to Statistics South Africa (Stats SA), the increase is primarily attributed to higher fuel prices caused by the Middle East Conflict.
The fuel index recorded a second consecutive significant monthly increase, rising 14.3%, and driving the annual fuel inflation rate to nearly 30%.
Stats SA noted that over the past 12 months, petrol prices increased by 24.8% and diesel by 53.8%, whose effect can be seen when looking at the ‘CPI excluding fuel’ index.
The annual change in this index was only 3.7% in May, identical to the month before, and in line with the narrow range of 3.5% and 3.8% it has maintained over the past 12 months.
As a result of the higher inflation and the subsequent increase in the cost of living, Cosatu has chosen to take its campaign to the streets, with a march in Tshwane scheduled for today, 19 June.
Louisah Moepeng Modikwe, Cosatu Gauteng Provincial Secretary, noted that South Africans continue to face severe economic pressures.
“The rising price of food, electricity, transport, water, housing and other necessities is placing unbearable strain on working-class families,” she said.
Modikwe stated that millions of workers are struggling to make ends meet, despite working hard every day.
“Cosatu believes that no family should be forced to choose between putting food on the table, paying for transport to work, or keeping the lights on.”
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