Recession not over for average consumer

2009-12-17 10:25

WHILE South Africa may be technically out of the recession,

consumers are still in the red, debt counselling service DebtBusters said on


“The National Credit Regulator anticipates a total of 150 000

consumers to be under debt review by Christmas,” MD Luke Hirst said in a


“We may have reverted back to our 3% to 6% inflation target range,

but to say this means we are out of the recession is not true for the average

South African consumer,” he said.

On average, figures showed that South Africa had 9 000 new

applicants for debt counselling each month.

“The contributing factor to this could be the rising number of

people who have lost their jobs this year.

“When you do not have an income it is unlikely you can pay off your

debt and in most cases the amount that people are earning is simply not enough

to cover basic living expenses, let alone cover your liabilities,” Hirst


According to Statistics SA, the number of people in the labour

force decreased by 418 000 from 17.5 million in the second quarter of this year

to 17.1 million in the third quarter of the year.

Hirst said that besides rising unemployment, increases in power

tariffs by a possible 35% year-on-year made the outlook “gloomy”.

Even though the economy had returned to growth in the third

quarter, with gross domestic product increasing by 0.9% after three quarters of

contraction, this did not mean that consumers should go out and celebrate just


“Recovery is likely to be slow,” Hirst said.

He advised consumers to continue to spend conservatively.

“Should you find yourself in debt, research the options that are

available to you.

“Consumers should actively begin a debt repayment plan.”

Hirst said consumers should consult a registered debt counsellor if

they had any concerns about their financial situation.

“South Africans under debt review need to realise that they have

been thrown a lifeline. By agreeing to pay a reasonable amount each month you

can avoid repossession of assets and legal proceedings,” he said.

Join the conversation! encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions. publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Inside News24

Traffic Alerts
There are new stories on the homepage. Click here to see them.


Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire network.


Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.