Trade federation Cosatu has called on government to look at the possible introduction of a petrol price cap to assist struggling consumers.
The federation welcomed the latest petrol price drop which was introduced on Wednesday (3 March) but warned that the gains would likely be wiped out by pending tax increase of 25 cents fuel tax increases from 1 April.
“Only a further reduction and a steady drop can give some respite to lower-income earners and poor households, in particular, because they are struggling to survive under these difficult economic conditions,” it said.
“Hopefully, this reduction will continue because workers are spending too much money travelling to work and they are sliding deeper and deeper int debt because of declining wages.”
It said that an extra decrease in the price of fuel will be able to boost the purchasing power of most South Africans and hopefully, lift the economy and help it recover.
The idea of a petrol price cap was first mooted by former energy minister Jeff Radebe in October 2018.
However, despite confirmation that the department was still considering the issue in April 2019, the issue has not gained further traction.
In 2019, a spokesperson told BusinessTech 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 28 March 2019.
“The fuel cap is still on the cards,” the spokesperson said at the time. “The draft report is being discussed internally at the moment. The department will issue a media statement once the internal consultation is concluded.”
Cosatu said it is still waiting on the government to release the research report.
“We are also calling on our government to consider increasing subsidies for public transport and improve the quality and efficiency of our public transport system, particularly in poorer communities and rural areas,” it said.