Government warns of inflated grocery prices in South Africa

The Department of Trade Industry and Competition (DTIC) says that South African consumers should be vigilant of price hikes during the country’s Covid-19 lockdown, and should educate themselves about the regulations that businesses must comply with during the Covid-19 pandemic.

DTIC deputy minister Nomalungelo Gina said that this is especially important as some retailers are selling goods at inflated rates.

With the high unemployment rate, this means that most consumers are no longer able to afford essential goods, especially those with inflated prices, she said.

“The anti-competitive behaviour by businesses might be one of the causes driving price hikes. The Covid-19 pandemic may have also contributed to how businesses are behaving in response to the pandemic, which in turn is affecting consumers in a negative way.

“It is therefore important for consumers to know their rights and understand steps to take where they suspect unfair practices by businesses,” said Gina.

Gina said that the department in conjunction with its agencies will hold a webinar to better educate consumers.

The dialogue will assist consumers with steps and processes to follow in reporting unfair pricing of goods and services – including price collusions or unfair increase of prices – and regulations with which businesses must comply during the Covid-19 pandemic.

Gina said that it is important for such behaviours to be stopped, which can be done only when they are reported.

South Africans paying much more

The latest Household Affordability Index by the Pietermaritzburg Economic Justice & Dignity group (PMBEJD) shows that while food prices have dropped slightly in June, baskets are way higher than they were last year – outpacing inflation by some margin.

The basket comprises 44 core food items most frequently purchased by lower-income households who make up the majority of households in the country.

The civil society initiative found that its household food basket saw a marginal drop in price month-on-month – but remains at much higher levels than September 2020, when the basket was first compiled.

The basket was tracked at R8.88 (0.2%) cheaper than a month ago (April) at R4,128.23. However, over the past 10 months, the cost of the average basket price increased by 7.1% or R271.90. Inflation over the same period was much lower, tracking between 3% and 5%.

Read: Food prices in South Africa are much higher than last year – here’s what you’re paying more for

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Government warns of inflated grocery prices in South Africa