Narissa Subramoney
2 minute read
3 Aug 2021
9:38 am

Cosatu ‘deeply bothered’ by fuel and electricity hikes

Narissa Subramoney

Cosatu has warned that small businesses might not survive the new increases.

Soweto residents protest outside Eskom's Megawatt Park head office at Sunninghill in Johannesburg on 9 June 2021, in demand of power that was switched off for three months. Picture: Nigel Sibanda

The Congress of South African Trade Unions (Cosatu) is “deeply bothered” by the rise in fuel and electricity prices.

As of Wednesday, consumers will be paying an extra 91 cents for a litre of petrol, while the diesel price will increase by 55 cents per litre.

ALSO READ: Fuel price: Consumers to feel the pinch at the pumps in August

If this isn’t enough, the National Energy Regulator of South Africa (Nersa) has green-lighted Eskom’s request to escalate power costs by 15.6% – with no end to the rolling blackouts.

“This spells disaster for many households because these increases will create more hardship for the working class and the poor. They are already suffering from record-high levels of unemployment and stagnant or declining wage,” said Cosatu national spokesperson, Sizwe Pamla.

Cosatu said small businesses might not survive the new increases.

Companies’ operations haven’t returned to normal since the first nationwide shutdown in March 2020, and there’s seemingly no end in sight to the varying levels of lockdown. 

Last month’s widespread looting and destruction of property also devastated KwaZulu-Natal and Gauteng’s economies.

“These higher fuel and electricity prices will worsen an already bad situation,” said Pamla.

“This will retard economic recovery, further weaken workers’ buying power and erode wages in the context of unemployment and wage cuts.”

ALSO READ: How Joburg residents will be affected by tariff increases from 1 July

The federation also wants the transport ministry to finalise the Road Accident Fund (RAF) and Road Accident Benefit Scheme Bills before Parliament.

Pamla accused the legal fraternity of treating the RAF as a lucrative cash cow.

“The bills will set the RAF back onto a sustainable path and ensure that payments reach claimants.”

Pamla said increasing the fuel levy only served to feed a bankrupt the RAF, which has been mismanaged into the ground.

“The RAF’s deficit of almost R300 billion is the greatest threat to the fiscus after Eskom’s debt burden,” said Pamla.

Cosatu added that the Department of Mineral and Energy needs to revive its solar-panel programme for impoverished households, to help ease the electricity demand and cushion the poor from steep price increases.