The Congress of South Africa Trade Unions (Cosatu) has called on the government to extend its fuel price tax relief beyond July.
The country’s largest trade federation said authorities must also establish a more affordable tax regime for fuel – including deregulation.
“The federation is busy trying to use dialogue to ensure that government take steps to stem the tide of unaffordable rise in fuel prices. These increases are bleeding workers’ meagre wages, making it difficult for businesses to hire workers, and suffocating the economy.
“There is an urgent need to deregulate the fuel price to allow competition, and the re-submission of the Road Accident Fund and Road Accident Benefit Scheme Bills at parliament to place the Road Accident Fund on a more sustainable financial path and lessen the need for it be bailed out through fuel levy hikes.”
It also called on the government to act swiftly to reopen all Metrorail lines to help 10 million commuters, and to ensure all Transnet freight lines are fully operational.
“The fragmentation of transport services in the country continues to undermine access to affordable, safe and reliable public transport. The public transport system should be well-coordinated and integrated. In our view, this is crucial for enhancing local economic development and eliminating the apartheid spatial challenges,” it said.
“The government needs to invest more in public transport and to begin plans to move cars and other vehicles from fuel to electric and hydro. These are critical to lessening South Africa’s dependency on imported fuel and exposure to volatile international oil prices.”
On Tuesday (31 May), the National Treasury and the Department of Mineral Resources and Energy announced that the general fuel levy reduction of R1.50/litre would be continued for another month. The reduction would then be halved to R0.75/litre in July, with the relief ending in August.
The government was under huge pressure to extend the levy reduction – without it, the petrol price would have increased by close to R4/litre at the start of June.
Despite this, the government is set to face continued social and political pressure to shield consumers from the cost-of-living surge and will be unable to give in to all demands going forward. In an open letter published on Monday (6 June), president Cyril Ramaphosa warned government cannot afford to keep extending these fuel price interventions.