By Kouthar Sambo
Food price volatility has not settled, and South Africans are concerned as the cost of living is breaking the banks.
But what are the financial implications for residents?
Speaking on VOC’s breakfast show on Thursday morning, Programme Coordinator at the Pietermaritzburg Economic Justice & Dignity Group Mervyn Abrahams described the financial situation.
“In the last month, we saw a slight decline in the cost of our basket of about R16 000. This month, we have seen an increase of about R25 000, which means that our basket now stands at R5081.94 c – which is a year-on-year increase of about R353,” said Mervyn.
This trend, explained Mervyn, indicates that households are still impacted by financial difficulty and inflation at large.
Coupled with this, consumers face the electricity increase, which is predicted to be at approximately 15% or more, depending on the municipality locals reside in.
“According to our research, the electricity increase will mean an average household who uses prepaid electricity, about 20 % of the national minimum wage will go towards that electricity bill,” explained Mervyn.
He went on to say that the electricity hike with food prices increasing while salaries remain the same. According to Mervyn, the net result suggest that people will allocate their budget to electricity and eat less food.
However, Mervyn added that whether or not these food prices are genuinely justified is a question that remains to be unanswered as they do not have direct contact with what he refers to as the “faceless people in between the line from the farm to the store.”
“It is impossible for us as an organization to get to the bottom of the exact data because we do not have access to the data. We need to get to the bottom of that to see whether these increased food prices are justified. Agricultural economists have been saying for the last three months that prices are going to come down, but we have not seen that happening,” added Mervyn.
