EDITORIAL | Godongwana has made all the right noises. Now the state must play its part

The fuel price is rising to R21 per litre on Wednesday, another shock to South Africans’ already empty pockets. Interest rates are rising, electricity tariffs are going up by nearly 10% and economic growth is expected to decline to about 2% this year, according to economists surveyed by the Bureau of Market Research. Russia’s invasion of Ukraine will see international oil prices spiral, worsening SA’s outlook.

The following might not mean much to the cash-strapped man in the street — but it could have been even worse. While the sharp fuel hikes will hurt all South Africans, it is worth noting that finance minister Enoch Godongwana in his budget speech announced the general fuel and Road Accident Fund (RAF) levies will not increase this year.

The national budget provides the first green shoots for such a turnaround as evidenced by the ‘tough love’ government policy ...

—  Bureau of Market Research panelists

The RAF is in such financial straits, a zero increase is a disaster for the agency, yet Godongwana and the government put the SA consumer first, instead of assisting another failing, badly managed state instrument. Godongwana also said if the government had increased the levies to make up for lost e-toll income, an additional 74c would have had to be added to the fuel price. That is why it was not an option.

The Eskom tariff increase of 9.61% we are facing this year is just as high. But again, if it weren’t for the National Energy Regulator of SA, Eskom could have got away with its original request for a 20.5% increase.

According to experts participating in the Bureau of Market Research economist of the year competition, economic woes for SA consumers are expected to continue in 2022. But again, there was a silver lining in its statement which pointed out that Godongwana made all the right noises in his budget speech. “Despite the overwhelmingly discouraging views expressed by the panel of economists, the poor outlook for the SA economy will prevail if the right macroeconomic policies are not crafted and executed. The national budget provides the first green shoots for such a turnaround as evidenced by the ‘tough love’ government policy ...”

While this will be another year of financial hardship for many, it must also be the year our government puts into action a renewed commitment to speed up infrastructural development, beef up the public employment programme and take a tough approach towards bleeding state-owned enterprises. We cannot afford anything else.