Tough times ahead for SA consumers

By Staff Writer
July will bring with it a multitude of increases for the South African consumer, placing a strain on already financially stressed South Africans.
Among these are the fuel price increase, an increase in transport costs, and rates increases in Cape Town.
Fuel price to increase
On Friday (26 June) the Department of Energy announced that fuel prices will be increasing from tomorrow.
The new prices are as follows: diesel will increase by four cents per litre, while illuminating paraffin (SMNRP) will increase by eight cents a litre, and illuminating paraffin (wholesale) will increase by six cents.
Petrol (93 unleaded and LRP) is increasing by 44 cents a litre, and 95 unleaded petrol and LRP will increase by 41 cents a litre. Liquefied Petroleum Gas (LPG) will have the largest increase, with an increase of 56 cents per kilogram.
In a statement it explained: “All petroleum products prices will increase with effect from the 1 July 2015. The increase in the prices of all the petroleum products is due mainly to the weakening of the Rand against the US Dollar during the period under review.”
The Department of Energy added: “The international prices for petrol increased on average, while the prices for diesel and Illuminating paraffin decreased.”
Rates and tariffs to increase
Residents of Cape Town will also be experiencing rate and tariff increases from 1 July. The increases are as follows:
·         Property rate: 10.83%
·         Electricity: 10.82%
·         Water: 11%
·         Sanitation: 11%
·         Refuse: 8.33%
·         Disposal: 9.31%
Johannesburg residents will also be subjected to  new rates and tariffs from 1 July. The rates for residential properties is now R0.006531, compared to R0.006161 for the 2014/2015 financial year.
For a full breakdown of the approved new tariffs for Johannesburg, click here.
Transport costs increase
Metrorail announced that on 1 July all of its train fares across the country will be increasing because it is struggling with the increasing costs of running trains.
Richard Walker, regional manager for Metrorail in the Western Cape, noted: “The cost of operating the current service has burgeoned – major cost drivers like electricity and safety-critical components have increased far beyond the rate of inflation.”
In the Western Cape the cost of a single ticket increases between 50 cents and R1, while the cost of a weekly ticket will have an increase of between R1 and R2, and monthly tickets will increase between R2 and R38.
For a detailed breakdown on the Western Cape Metrorail prices, click here.
Metrorail was contacted for the price increases of the other regions, but had not responded at the time of publication.
Further increases ahead
The National Energy Regulator of South Africa (NERSA) held public hearings this week regarding Eskom’s request for an additional 6.43% increase in tariffs, on top of the 12.69% that it had already been granted.
But NERSA denied Eskom’s application. However, commentators have warned that consumers are not in the clear just yet as Eskom will be able to submit a new application for a future increase.
For more information on the NERSA announcement, click here.

Recent Articles

Featured Can you avoid using a retirement fund?

Sceptical about having a retirement fund? We briefly consider some pros and cons of retirement funds.

Offshore investing 101 – how much should you invest?

Offshore investing has significant financial advantages. We explore how to invest offshore and what it takes to secure great portfolio performance.

When should you invest rather than save?

Extra cash left at the end of the month? We have a look at the differences between saving and investing, and we find out how you should decide which one to pursue.

Investing for your retirement – which product to use?

Retirement annuities (RAs) and tax-free savings accounts (TFSAs) - which is better when planning for your retirement?

Latest Guide

Guide to debt rehabilitation solutions