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New push for a fuel price cap in South Africa

The Congress of South African Trade Unions (Cosatu) says that government should relook at the introduction of a fuel price cap, as petrol prices reach record highs in South Africa.

Cosatu is the largest trade federation in the country with an estimated membership of 1.8 million workers.

The call comes amid a steep rise in the price of fuel that has seen the petrol price rise by R1 per litre and 65 cents per litre of diesel this week. Cosatu added that the increase of 62 cents for paraffin will leave many poor families worse off.

“This fuel price hike will create more hardship for the working class that is already suffering from high levels of unemployment and stagnant or declining real wages.

“Low- and moderate-income families are going to plunge further and further into debt because their wages are now inadequate to afford the basic amenities.”

Cosatu said that workers already spend an average of 25% of their wages on transport.

“These higher fuel prices will also drain away the purchasing power of most South Africans and this will retard economic recovery.

“This coupled with the government austerity measures that have seen below-inflation adjustments for social grant spells disaster for many households.”

To address these issues, Cosatu called on government to release a research report that was conducted by the Department of Energy looking into the possibility of a fuel price cap.

“We are also calling on our government to consider increasing subsidies for public transport and improve the quality and efficiency of our public transport system, particularly in poorer communities and rural areas,” it said.

The idea of a petrol price cap was first mooted by former energy minister Jeff Radebe in October 2018.

However, despite confirmation that the department was still considering the issue in April 2019, the issue has not gained further traction.

In 2019, a spokesperson  said that the department had concluded one-on-one engagements with all relevant stakeholders, and was still waiting for written submissions on the matter – the final date for which was 28 March 2019.

“The fuel cap is still on the cards,” the spokesperson said at the time. “The draft report is being discussed internally at the moment. The department will issue a media statement once the internal consultation is concluded.”

Read: You’ll now pay R313 tax every time you fill up with petrol

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