Petrol price cap still on the cards for South Africa – but another price freeze is out

After a hefty fuel hike at the beginning of April, there have been a number of calls for government to step in and prevent further increases.

In a statement released on Wednesday (3 April), trade federation Cosatu said that this should include a revision of the current taxes on fuel and the possible introduction of a fuel price cap.

“It is becoming blatantly clear that our inept government does not have a solid plan to lessen the impact of these fuel hikes on consumers,” Cosatu said.

“We are calling on the government to release the promised research on the possible fuel price cap.

“The government promised a review of the fuel price structure in November 2018. Since that promised review, the public has heard nothing from the state. In the meantime, the fuel price has been increased three times with another massive increase predicted for May.”

Fuel cap

Speaking to BusinessTech, a Department of Energy spokesperson said that it was still too early to comment on the possible introduction of a fuel cap.

However, he added that the department had concluded one-on-one engagements with all relevant stakeholders, and was still waiting for written submissions on the matter – the final date for which was only 28 March 2019.

“The fuel cap is still on the cards,” he said.

“The draft report is being discussed internally at the moment. The department will issue a media statement once the internal consultation is concluded.”

Other interventions 

The department also said that it was looking at other measures to lessen the impact of increasing fuel prices.

“The department started with the process of reviewing the fuel pricing formula and the deadline for submission of comments on the Basic Fuel Price (BFP) review was 29th March 2019,” it said.

“The outcomes of the review will inform the department on the way forward. Further to this, government is considering de-linking the Road Accident Fund (RAF) from the fuel prices with the new RAF Bill that is under discussion.”

However, this will not include a hold in fuel prices as was the case in September 2018.

“That was a once-off intervention at the time,” the department said.

Read: You will be taxed R277 every time you fill up with petrol from midnight

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Petrol price cap still on the cards for South Africa – but another price freeze is out