Estimated reading time: 3 minutes
Over the past year, Newcastillians have come to accept numerous changes in their daily lives. But what has been the past year’s financial implications on your household and, more specifically, your income? And what can you expect to fork out in months to come?
As of 1 April 2021, Newcastillians can expect a surge in their electricity tariffs, with Eskom confirming an average price increase of approximately 15%.
This sharp rise in electricity prices follows the High Court of South Africa (Gauteng Division), ordering that an amount of R10 billion be added to Eskom’s allowable revenue to be recovered from tariff customers in the 2021/22 financial year.
Adding further strain, the cost of food has increased significantly, with people now paying more for their groceries. Research from the Pietermaritzburg Economic Justice and Dignity Group (PEJDG) shows that food prices rose by 17% during 2020.
While not nutritionally complete, the Household Affordability Index details price changes for basic and essential food items. According to the index, over the past six months: The average cost of the foods prioritised and bought first in the household food basket increased by R114,93 (5,6%) from R2 065,71 in September 2020 to R2 180,64 in February 2021.
Adding to this, in its report published in January, Statistics SA pointed out the annual rate of consumer inflation was 3,2% in January, slightly up from December’s reading of 3,1%.
Furthermore, as of January, the annual inflation for food and non-alcoholic beverages was 5,4%. Meat prices rose 1,5% between December and January, oils and fats are the food category with the highest annual rate, hitting 10,5%.
One cannot ignore the constant rise in fuel prices, with the petrol prices exceeding the R16 mark per litre as of the beginning of March 2021. But further fuel prices are expected in the coming months.
Economists from the Bureau for Economic Research (BER) explained the combination of the rapidly rising oil prices, alongside a weaker South African currency, has pushed the rand oil price even higher. If this continues, BER warns South Africa will see yet another spike in petrol prices in April.
In his budget speech, the Minister of Finance Tito Mboweni also announced the fuel levies would be increased by 27 cents per litre, comprising 15 cents per litre for the general fuel levy, 11 cents per litre for the Road Accident Fund levy and 1 cent per litre for the carbon fuel levy—all contributing to the soaring cost of living in South Africa.
The South African automotive industry is facing a rather challenging 2021, with new vehicle prices continuing to increase even further.
According to the latest TransUnion SA Vehicle Pricing Index (VPI), vehicle prices rose above the inflation rate for the third successive quarter in Q4 2020. This, at a time when consumers already face financial difficulties, seeing several car dealers dualling to remain afloat.
According to the group’s data, new vehicle pricing increased from 2.9% in the fourth quarter of 2019 to 9.6% in Quarter 4 of 2020. Used vehicle pricing has spiked from 1.2% in Q4 2019 to 2.9% in Q4 2020.
When looking at this, one cannot help but wonder, how are people expected to live? Especially when looking at the unemployment rate?
Statistics SA’s latest findings reveal South Africa’s unemployment rose considerably during the fourth quarter of 2020, increasing by 1.7%—resulting in the official unemployment rate expanding to 32.5%. This means the number of unemployed people increased by 701 000, with 7.2 million people now sitting without employment.
From petrol prices, electricity tariffs to car prices and food costs being more than ever before, coupled with millions of people left unemployed, what are your thoughts?
Share your views in the comment section below.