President Cyril Ramaphosa says government is considering further fuel-price relief as unions call for the proposed R10bn intervention to be used to cushion households, workers and businesses.
The calls for relief come ahead of Finance Minister Enoch Godongwana’s Medium-Term Budget Policy Statement on Wednesday, as organised labour presses for urgent action while government weighs the cost of further intervention against other spending priorities.
Speaking to the media at Bana Pele ECD Summit in Sandton yesterday, Ramaphosa said government was considering further measures to provide relief from rising fuel prices.
However, he cautioned that such interventions came at a cost, revealing that an earlier subsidy had required R24 billion to be redirected from other government programmes.
“The fuel price is a problem globally. We are not the only country that is affected by rising fuel prices, and of course, there are various responses by various entities, governments and businesses, and we are giving serious consideration to what is to be done.
“You must remember that when the fuel price rose a few months ago, government intervened and poured about R24 billion into a subsidy system. Now that is R24 billion that we are removing from other programmes.
“Now that it has gone up again, everyone in the world is giving consideration to what they should do. So are we,” he said.
The proposed R10 billion allocation, contained in the Second Special Appropriation Bill, would provide the Department of Mineral and Petroleum Resources with funding for a possible intervention to offset increases in the basic fuel price. Parliament’s Standing Committee on Appropriations adopted its report on the Bill on October 8, but the proposal still has to proceed through Parliament.
The Congress of South African Trade Unions (COSATU) has urged government to use the proposed allocation for its intended purpose, warning that rising fuel costs are placing pressure on employment, small businesses and the price of essential goods.
COSATU parliamentary coordinator Matthew Parks said the impact was felt across the economy.
“This Bill does provide a very necessary and timely intervention, and we represent millions of workers across all parts of the economy, whether it’s the fuel station attendants, whether it’s a teacher who’s driving to work, whether it’s farm workers who depend upon diesel to do their work, whether it’s workers who take trains to get to work, and of course, workers are consumers too,” Parks told Parliament.
He said the allocation should not remain unused while households and businesses absorb repeated increases.
“We have seen the massive hikes yet again on the fuel price, and this fund, this money, should be utilised for its very purpose, which is to protect women and the economy. We should not just simply allow it to sit idle,” Parks said.
The proposed intervention has also drawn scrutiny over how the money would be distributed and whether relief would reach those most affected.
Select Committee on Appropriations chairperson Tidimalo Legwase said the public hearings had highlighted the need to balance urgent support with transparency and accountability.
“We have also been reminded during this public hearing that this is a temporary emergency measure. A once-off appropriation aimed at providing a cushion against an external shock, but it cannot shield South Africans permanently from oil-price volatility nor can it replace a structural reform needed in a fuel pricing and transport system,” Legwase said.
Professor Dumisani Jantjies of the Pan-African Institute for Fiscal and Policy Studies warned that the pressure on households could extend beyond fuel and transport expenses.
“You know, if you think about it improperly, we pay twice as household. Firstly, the price of the petrol itself, but secondly, because of the increase in interest rate, we also pay through our debts as household bonds go up,” Jantjies said.
Build One South Africa (BOSA) leader Mmusi Maimane has also called for the proposed R10 billion allocation to be channelled through the Equalisation Fund to reduce fuel taxes and bring down prices at the pumps.
“R10 billion rand relief into the Equalisation Fund ensures that the general taxes on fuel are lowered, which will effectively drive fuel prices down,” Maimane said.
He argued that reducing fuel costs could have a wider impact on the cost of living, adding: “Lower fuel costs means lowered inflation, affordable food, lower interest rates on your credit and bond, and an affordable South Africa for all.”
The Federation of Unions of South Africa (FEDUSA) has also renewed its call for fuel levy relief, arguing that the consequences of higher fuel prices extend well beyond motorists.
“Rising fuel costs have consequences far beyond the pump, contributing to higher transport fares, food distribution costs and the overall cost of living,” FEDUSA said in its statement.
General secretary Riefdah Ajam said the federation wanted government to prioritise workers’ livelihoods and cost-of-living relief, including through a review of fuel levies and targeted support for vulnerable households.
“Workers cannot continue to carry the cost of economic stagnation and persistently rising fuel prices,” the federation said, calling for meaningful measures rather than continued promises of relief. FEDUSA has also backed a R3-per-litre fuel subsidy.
With the recent fuel increases The United Association of South Africa (UASA) had also called for immediate intervention, warning that rising transport costs are eroding workers’ disposable income. UASA spokesperson Abigail Moyo said workers were struggling to absorb increases alongside the wider cost of living.
“When the simple act of getting to work becomes unaffordable, it is a clear indication that intervention is needed,” Moyo said.
The union has argued that workers should not be expected to shoulder every shock in international energy markets without meaningful support.