Price hikes a blow to poor


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Nestl� Shreddies one of the unfamiliar brands now stocked at Shoprite/Checkers stores.

Cash-strapped consumers are set for another blow – a predicted increase in the price of food as a result of damage to crops from recent floods, and increases in electricity fees, manufacturing costs and global food prices.

While there is good news with the petrol price falling by up to 33c on Wednesday, it comes on the back of an almost 20 percent increase in the price of electricity on Friday. And the fuel price cut respite will be short-lived, given the likely impact of the food price hike.

The provincial government on Friday warned that the cost of flood damage in the Western Cape was now approaching R600 million. The intensity of the flood had been “extremely high”.

The Minister of Agriculture, Gerhard van Rensburg, and local government and environment MEC Anton Bredell, met farmers in Herbertsdale yesterday to discuss the damage caused by last month’s floods.

“Bad weather has again left its mark on our province. The intensity of the flood was extremely high as flood studies indicate,” said Bredell

Van Rensburg added that a lot of agricultural land had been washed away. “We need to help farmers repair the damage before the next flood washes more soil away and makes farming impossible.”

National Consumer Forum chairman Thami Bolani said electricity and food prices were a “painful topic”. More families, he said, were turning to using candles and paraffin.

“Electricity is simply not affordable. Added to this are rising food costs, municipal rates, toll fees and transport cost. A lot of families are grappling with unemployment. Our education system is in crisis. Food security is a serious problem. Crime is being fuelled by rising figures of unemployed youth going hungry on the streets. The quality of life is getting worse.”

Economic development consultant and researcher Takura Chamuka said high energy prices could have significant consequences. “The recent floods and the energy price increases will undoubtedly be a double blow for consumers. One cannot over-emphasise the severity of the social implications of rising food prices, particularly for the urban poor.”

He said there was no doubt that the floods would have an impact on the vegetable and fruit growing communities in the Free State (which also experienced damage) and the Western Cape. “The negative impact will emanate from in-frastructure damage, disruption in the supply chain with respect to logistics and damage to the crops.”

Prices should normalise to pre-flood levels within two to four months if production was resuscitated.

Foreign markets also played a role in food prices. Although weather events had been playing havoc on world commodity markets since last year, an increase in the price of local maize-related products was not necessarily due to the floods but had been influenced by international prices.

The deregulation of South Africa’s agricultural market in 1996 had led to the domestic price of maize and other agricultural produce being dictated by world prices and exchange rates. - Sunday Argus

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silver and gold, wrote

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11:14am on 4 July 2011
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the ruling party does not have any plan in place, if this continues at the current rate we will have only a few rich and masses of starving people. The ANC is busy killing the middle class, a needed pillar in any economic society. What then?

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@reekus, wrote

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10:58am on 4 July 2011
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The ANC definately IS pro-poor. There are more and more poor every day, hence more ANC voters.

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Cynical Witch, wrote

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10:55am on 4 July 2011
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Can you spell recession? Do these people who run this country not realise that taxpayers money is not infinite? We are in a gemors!

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reekus, wrote

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09:58am on 4 July 2011
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Despite the ANC preaching for the last 17 years that they are pro-poor, they have failed to walk the talk, and poverty and unemployment is on rise. Radical changes are needed, like our Mr. Prez, his cabinet, ministers, DGs, etc all taking a massive salary cut, in order to show solidarity with the poor, and use that money to uplift them. Its time to lead by example. 17 years of theft,corruption and maladministration has caused this situation, and much much more should have been achieved if the greed was kept at bay. Then there is the refugee and illegal immigrants which SA cannot sustain. Another problem is the small tax base we depend on...so why do taxi owners not contribute?

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Mrs Kiwi, wrote

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09:54am on 4 July 2011
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Ant the govt is so rich and MP's live like rock stars while the people starve.Lesson to the voters.Wait for the uprising.

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Francisco de braganca, wrote

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09:34am on 4 July 2011
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Its very sad to know current happenings in the country .polititions should come hand in hand solving this crises.

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brian, wrote

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08:11am on 4 July 2011
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Agreed, where is so much of any tax going? None of it ends up to bolster employment, provide food subsidies, etc.. The general public don'tknow, much less the working class who don't have access to this type of information or debate. If only they knew. I hope they catch on like the Arab proletariate have.

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Anonymous, wrote

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06:42am on 4 July 2011
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The huge petrol hike should have already amassed the R600 million needed to help the farmers, why raise food prices, where is the money going to.

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Laurie, wrote

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05:22pm on 3 July 2011
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Let's not forget what impact the new tolls will have on the price of goods ...

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