Low-income and marginalised communities are on the verge of falling into extreme poverty with the looming municipal tariff hikes in July and the soaring prices of food, electricity, water and fuel.
Although President Cyril Ramaphosa said government will do everything in its power to protect South Africans from unsustainable increases in the cost of living, experts say the massive rise in the cost of basics is making life more expensive and leaving many in debt.
Economist Azar Jammine said consumer price inflation (CPI), which is set to come out higher this year, depending on the food inflation, will likely rise to at least 6.8% over the next couple of months, could affect food security for the poor.
“SA is one of the most self-sufficient economies in the world from a food point of view, but the problem is that the poor can’t afford food,” he said.
“New ways need to be found to redistribute food to the poor as there is a lot of food wastage that one sees around. Ways need to be found to distribute the food more effectively so the poor can actually access it without having to buy it all the time.”
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Delivering a budget speech recently, Julie Suddaby, the City of Joburg’s mayoral committee member for finance, said property rates would increase by 4.85%, electricity by 7.47% and water by 9.75%.
And 57-year-old SA resident Themba Ntsimane said many South Africans have lost hope as they opt for more streams of income, because “the sad truth facing many households is the cost of living is suffocating the middle and lower class”.
“It’s no question that we are struggling to survive. People fail to get by on wages which aren’t even sufficient to meet their basic needs,” he said.
“It’s only a matter of time until people go and loot again and this time not for fun, but because they are actually hungry and cannot afford to buy food.”
The January 2022 Household Affordability Index, published by the Pietermaritzburg Economic Justice & Dignity Group, placed the average cost of a household food basket at R4 401. This was a 2.9% (R125) increase from the previous month and a year-on-year increase of 8.6% (R350).
The report showed in January there were price increases for 15 of the 17 foods considered to be the core foods, such as cooking oil, which had risen 30%. A 10kg bag of frozen chicken pieces cost 17% more the price of white bread rose 4.5% and that of brown bread 3%.
Marketing manager of personal finance website JustMoney. co.za Shafeeka Anthony said the combined effects of the pandemic, a weak economy and rising inflation, with higher food and fuel prices, are resulting in greater financial stress for most South Africans.
“Budgeting is an essential step in taking financial control. The most important factor in budgeting is keeping track of incoming and outgoing funds,” she added.
“Also keep in mind that, however much you plan, unexpected expenses may well arise. Aim to build up an emergency savings account that will enable you to cope with unplanned costs, such as out-of-cover medical, or vehicle repairs.”
Marketing manager of personal finance website JustMoney.co.za Shafeeka Anthony gives some tips: