Consumers face triple price-rise whammy

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Copy of ST Petrol price 018 (41027210) Independent Newspapers. The price of petrol is due to rise at midnight on Tuesday. Picture: Itumeleng English.


Cape Town - Train commuters will pay up to R30 more for their tickets as Metrorail’s fare hikes come into effect on Tuesday in a week where the price of fuel and electricity are also set to increase.

The first increase kicks in on Tuesday when Metrorail train fares go up by 50 cents for a single and R1 for a return ticket. Weekly ticket increases range between R3 and R7 while monthly tickets increase between R7 and R30.

The City of Cape Town’s electricity tariff increase of 7.63 percent also comes into effect on Tuesday.

At midnight petrol will go up by 31c a litre on the coast and 29c inland while diesel will increase by 14c a litre, the Energy Department said.

It said the steady rise of crude oil prices, and the depreciating rand against the US dollar had contributed heavily to the fuel price hike.

Economists have warned that the increases would have a severe impact on already hard-pressed consumers and don’t foresee a reprieve.

Metrorail’s increases are being implemented despite strong opposition from Cosatu. The union federation was prepared to go on strike against Metrorail service and the poor state of train infrastructure, but suspended the action to give an opportunity for negotiations.

Cosatu provincial secretary Tony Ehrenreich said it was likely to strike.

He said Cosatu had a meeting with Transport Minister Dipuo Peters’s advisers and Metrorail representatives on Thursday.

“We were hoping they would come to their senses and not go ahead with the increase which will force workers to pay more to use a service that is not up to standard,” Ehrenreich said.

“We have been waiting for a response from the advisers and if they don’t give positive feedback we will go ahead with the strike this month,” Ehrenreich said, adding that the strike would probably take place on July 16.

Metrorail regional manager Richard Walker said the increase was in the line with inflation.

“The cost of operating the business has soared due to the increase in the cost of energy, personnel, maintenance material, safety-critical and statutory compliance which account for the bulk of the region’s expenses.”

He said Cosatu’s claims that the increase would add a burden to commuters was unsubstantiated. “Commuter rail remains the most affordable and competitive public transport service provider despite these increases and our subsidy per passenger is by far the lowest.”

Walker said the increase would help Metrorail build “state-of-the-art” stations, refurbish trains, repair signalling and introduce rail to new areas.

Efficient Group chief economist Dawie Roodt said further increases in the fuel price could be expected over the next few months as the rand was expected to depreciate further and because there had been a steady rise in the price of crude oil.

“We don’t predict any relief in the foreseeable future and fuel prices will continue climbing,” Roodt said.

Neil Roets, chief executive of debt management firm Debt Rescue, said the increases could lead to many more South Africans falling into the debt trap.

He said rising food and fuel costs and slow economic growth made it it difficult for many South Africans to pay back their loans on time.

“The writing is on the wall for many middle-class families who have only recently escaped from dire poverty. Many will be pushed back into poverty,” Roets said.

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