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At the start of December, South Africa saw its latest fuel price increase push the price of petrol to over R20 a litre in some parts of the country, its highest level yet. This caused an outcry. Energy sector expert Rod Crompton explains how the fuel price is calculated.
South Africa hasn’t achieved its policy objective of deregulating the fuel price because vested interests have opposed this, and the government doesn’t have the political will to implement the policy.
There is a position that says more taxes aren’t necessarily a bad thing, as these are ploughed back into the infrastructure spending of a developmental state, which improves the economy. That’s true if it happens that way. Sadly, ours is often wasted through gross inefficiencies in leaky procurement processes that pay three times the price for infrastructure that we don’t often need, while a whole lot is lost to corruption. The result is overspending and less delivery which stimulates the angry taxman to seek more revenue, often through a short-term mindset, by increasing taxes or borro...