Trade union federation Fedusa says focus should be placed on the restructuring of the fuel levy to lessen the burden on motorists and households.
Fedusa made this comment on Tuesday as fuel price increases were announced for August on Monday, showing a 37c/l increase for petrol and 72c/l increase for diesel, while illuminating paraffin — which Fedusa said “lights up and provides heat in the homes of the poorest in our communities’” — will increase by 71c/l.
The Automobile Association said in May 2023, the total cost of the two main levies paid for fuel stood at R6.14 [R3.96 for the general fuel levy and R2.18 for the Road Accident Fund levy], which is levied on every litre of fuel sold in the country. The general fuel levy for diesel is R3.70 a litre.
The general fuel levy is used to fund general government expenditure programmes.
Fedusa said the fuel price increases came at a time when the average South African worker can barely keep up with high inflation, VAT and other services costs such as electricity and rates.
Fedusa said the reasons stated by mineral resources and energy minister Gwede Mantashe for the increases may primarily be external factors such as the prices of crude oil and the rand/dollar exchange rate. The trade union federation said this did not mean government should simply step aside, leaving citizens to take the blow.
“Enough time has passed for the sixth administration to have devised a socioeconomic plan to deal with the price of fuel due to its far-reaching implications on the broader cost of living.
“Food prices, which research by various bodies has proven have skyrocketed over the years, will also be adjusted by retailers, leaving many households in distress. Salaries have been shrinking for years, with workers forced to take up what is now popularly referred to as ‘side gigs’ just to survive,” Fedusa said.
It said workers were also being strangled by the ever-increasing interest rates, making borrowing even more expensive on every front including home loans.
It said the latest Altron Fintech Household Resilience Index, as quoted by BankServAfrica in its most recent Take Home Pay Index, showed South African households were now worse off than before Covid-19 with household financial resilience declining by 2.4%.
“Yet, the government has in the face of this failed to recognise the need for a concerted effort to grow the economy while prioritising the needs of the people,” said Fedusa.
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Fedusa calls for restructuring of fuel levy as fuel price set to increase
Image: alphaspirit / 123rf
Trade union federation Fedusa says focus should be placed on the restructuring of the fuel levy to lessen the burden on motorists and households.
Fedusa made this comment on Tuesday as fuel price increases were announced for August on Monday, showing a 37c/l increase for petrol and 72c/l increase for diesel, while illuminating paraffin — which Fedusa said “lights up and provides heat in the homes of the poorest in our communities’” — will increase by 71c/l.
The Automobile Association said in May 2023, the total cost of the two main levies paid for fuel stood at R6.14 [R3.96 for the general fuel levy and R2.18 for the Road Accident Fund levy], which is levied on every litre of fuel sold in the country. The general fuel levy for diesel is R3.70 a litre.
The general fuel levy is used to fund general government expenditure programmes.
Fedusa said the fuel price increases came at a time when the average South African worker can barely keep up with high inflation, VAT and other services costs such as electricity and rates.
Fedusa said the reasons stated by mineral resources and energy minister Gwede Mantashe for the increases may primarily be external factors such as the prices of crude oil and the rand/dollar exchange rate. The trade union federation said this did not mean government should simply step aside, leaving citizens to take the blow.
“Enough time has passed for the sixth administration to have devised a socioeconomic plan to deal with the price of fuel due to its far-reaching implications on the broader cost of living.
“Food prices, which research by various bodies has proven have skyrocketed over the years, will also be adjusted by retailers, leaving many households in distress. Salaries have been shrinking for years, with workers forced to take up what is now popularly referred to as ‘side gigs’ just to survive,” Fedusa said.
It said workers were also being strangled by the ever-increasing interest rates, making borrowing even more expensive on every front including home loans.
It said the latest Altron Fintech Household Resilience Index, as quoted by BankServAfrica in its most recent Take Home Pay Index, showed South African households were now worse off than before Covid-19 with household financial resilience declining by 2.4%.
“Yet, the government has in the face of this failed to recognise the need for a concerted effort to grow the economy while prioritising the needs of the people,” said Fedusa.
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