The announcement by the Department of Mineral Resources and Energy of the November fuel price adjustments is very bad news for South Africans ahead of the fast-approaching festive season.  The big jump in prices for both petrol and diesel, with both 93 and 95 octane petrol increasing by 51 cents per litre and diesel by R1.43 per litre, means that motorists will likely fork out R22.57 a litre for 93 octane petrol at the pumps and R25.49 per litre of diesel from Wednesday 2 November onwards. 

In contrast, the average international product prices for Petrol, Diesel and Illuminating Paraffin decreased during the period under review. The price hikes have been attributed to the depreciation of the rand against the US dollar in the period under review.

CEO of Debt Rescue Neil Roets, who frequently highlights the plight of consumers says: “Regardless of the economics behind this hike, it is devastating news for South Africans who were counting on a little financial relief over the festive season to briefly shrug off the economic woes of the past year, and recharge their batteries.  This hope has just been obliterated.  There will inevitably be a corresponding hike in public transport costs, and this means that many working class citizens who have been looking forward to this once-a-year occasion to visit their families, will simply not be able to afford the travelling costs this year.” 

The price hikes in petrol and diesel will also unavoidably result in more food price increases, at a time when two thirds of the population can no longer afford three square meals per day. 

The questions remains: Why are our retailers not doing absolutely everything they can to bring down the price of basic foodstuffs, to provide relief to consumers during the country’s cost of living crisis?  This question mark has been escalated by Mervyn Abrahams of Pietermaritzburg Economic Justice & Dignity Group (PMBEJD), creators of the Household Affordability Index, who says that although petrol prices dropped in recent months, we have not seen a corresponding drop in food prices at the retail level.   

“South Africans are paying nearly 14% more for basic food items than they did a year ago, and this is over and above the steep electricity and petrol prices, not to mention the interest rate hikes that have completely decimated people’s budgets,” laments Roets.

“The Financial Action Task Force’s (FTAF’s) threat of a grey listing also looms large in November,” says Roets. “Disinvestment in the country will result in further interest rate hikes and we will see a massive spiral downwards. We could see the country plunging into a deeper recession, with catastrophic consequences for food security, and an ever-deepening food crisis.”

He says that the petrol price hike will lead to South Africans leaning even more heavily on their credit and store cards to be able to celebrate the festive season in some kind of way – and for many this will simply mean putting enough food on the table – starting out the New Year in even more debt.

“My advice to those who fall into this trap is to seek help from a registered debt counsellor who can assist them to manage their financial predicament. This has been a very successful solution for thousands of consumers who are plagued by over-indebtedness,” concludes Roets.