SA's 'poor are being hardest hit' by rising electricity prices, cost of living - Ramaphosa

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President Cyril Ramaphosa
President Cyril Ramaphosa
PHOTO: OJ Koloti, Gallo Images
  • President Cyril Ramaphosa says the increasing price of electricity will add to the difficulties South Africans are already facing.
  • In his weekly newsletter, Ramaphosa says citizens and businesses are already contending with the high cost of fuel, food and other essentials.
  • He says the government is considering additional mechanisms to address the rising cost of electricity.

The rising cost of electricity comes at a challenging time and will add to the difficulties South Africans are facing, according to President Cyril Ramaphosa.

In his weekly newsletter, Ramaphosa said he made a call last week for the Eskom board to consider measures that could help mitigate the impact of the 18.65% tariff increase.

It comes after the National Energy Regulator of SA (Nersa) awarded Eskom one of its largest hikes - 18.65% - for the 2022/2023 financial year.

Ramaphosa said the price hike came at an "extremely difficult time" for citizens and businesses alike, who were already contending with the high cost of fuel, food and other essentials.

READ | Ramaphosa asks Eskom to halt 18.65% power tariff hike

"It is important that we affirm the independence of Nersa and the importance of following the due legal process in setting tariffs.

"Tariffs that reflect the cost of producing electricity are necessary for Eskom's financial sustainability and for the utility to be able to service its debt and to undertake the critical maintenance that is needed to end load shedding.

"Yet, there is little doubt that increasing the price of electricity now, at this challenging time, will add to the difficulties South Africans are facing. Rising food and energy prices are fuelling a cost of living crisis around the world, and the poor are being hardest hit," he said.

Ramaphosa said food prices in the country had increased, on average, by 12% over the past year.

READ | EFF plans national shutdown to protest load shedding, call for Ramaphosa to resign

"This is the problem we face; we have to ensure that Eskom has the resources it needs to resolve the electricity crisis while protecting South Africans from the effects of higher prices. There is no simple answer to this problem.

"That is why all stakeholders, including government, Eskom, business, labour, and communities, need to work together to achieve a very difficult balance," Ramaphosa said.

Ramaphosa said the government should be guided by the needs and interests of citizens, especially the poor, and should be wary of short-term solutions that it would regret in years to come.

"As government, we will continue to implement policies and measures to mitigate the hardship being experienced by vulnerable citizens. Since the earliest days of democracy, we have implemented a policy of free water and electricity for indigent households.

He said:

The free basic electricity allowance, if implemented properly by municipalities, should shield the poorest households from the effect of the tariff increase. We remain absolutely committed to this policy.

He said other programmes to expand the social wage include the provision of free primary healthcare, exempting pupils from poor families from paying school fees, a school nutrition programme that supports over nine million learners countrywide and the provision of free tertiary education for students from poor families.

"All of these measures provide an important social wage that has helped to cushion poor households from the worst effects of rising prices."

ALSO READ | Permanent closure of businesses and the sickly being rushed to hospital, this is how loadshedding is affecting South Africans

He said the government was considering additional mechanisms to address the rising cost of electricity.

"These include measures such as helping households and small businesses install solar power and energy-saving devices, supporting households with rechargeable lights, and working with learners to catch up where load shedding interrupts lessons.

"As government, we will continue with our efforts to expand the social wage, just as we accelerate our efforts to restore a reliable and secure electricity supply."

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