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(Getty)
- In the last decade, administered prices have risen vastly more than headline inflation, the Reserve Bank told Parliament.
- Electricity prices have risen 177% in the last 10 years, while municipal rates and taxes have risen 118%.
- That compares with the overall CPI of 68%.
- But the biggest price increase is in water, which now costs 213% more than in early 2010.
- For more stories, visit www.BusinessInsider.co.za.
Managed prices – those dictated by the government – “continue to be higher” than headline inflation, the Reserve Bank of South Africa has told Parliament, in a somewhat understated way.
Over the past decade, the bank says, the increase in the general consumer price index (CPI) totaled 68%, so a basket of goods that cost R100 in early 2010 will now require R168 to buy.
During the same period of time, municipal fees and taxes have increased by 118%, which means that it now costs R $ 180 to settle a bill of fees and taxes worth R1,000 ten years ago.
The price of electricity has increased by 177%, which translates to R500 in electricity in the run-up to the Soccer World Cup in South Africa now costing R1,385.
But those increases fall far short of the change in an even more fundamental requirement: water. Since early 2010, the Reserve Bank told Parliament’s standing finance committee that the price of water in South Africa has risen by 213%.
Prices administered during the last decade, compared to the general CPI. (Reserve Bank of South Africa)
That means that an average South African who was spending R400 on water per month in early 2010 now has to spend R1 252 to buy the same amount of water.
Assuming that the hypothetical consumer saw that their income was in line with the general CPI (which is often used as the basis for wage increases), and had to keep the proportion of their income spent on water the same, they will have had to reduce their water use by more than half to keep up with price increases.
(Compiled by Phillip de Wet)
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