The Congress of South African Trade Unions (Cosatu) has expressed dismay over the rise in fuel and paraffin prices, asserting that this will be a painful blow to an already battered economy and struggling working class.

The petrol price is expected to increase by 75c, diesel by R1.60 and paraffin by R1.50.

The trade union is concerned that the increases could spur inflation and compel the Reserve Bank to increase the repo rate, again. It also contends that low- and moderate-income families could plunge further into debt, constraining their purchasing power.

The sustainability of small, medium-sized, and microenterprises would be under threat along with the jobs of many employees in this sector, it warned.

“We are dismayed by the government’s reluctance to release and act on the comprehensive review of the fuel price regime to reduce the taxes which constitute 28% of the fuel price regime. This unfulfilled commitment was made by then-Minister for Energy Jeff Radebe in September 2019 and the current Ministers for Mineral Resources and Energy and Finance, Gwede Mantashe and Enoch Godongwana in April 2022,” Cosatu pointed out.

The trade union has also urged the Department of Transport to consider the repositioning of the Road Accident Fund and the Road Accident Benefits Schemes Bill in Parliament owing to the fund’s dependency on “above-inflation increases for the fuel levy”.

Cosatu wants government to adjust social grants at the upcoming Medium Term Budget Policy Statement to protect workers from the effects of higher prices. The trade union also advocated for expanded subsidies to improve the quality and efficiency of the public transportation system in poorer communities.

“Whilst there is little that government can do about the international oil price volatility, it can, as it did in 2022, provide relief to commuters and the economy by lowering fuel taxes. This will have the additional benefit of reducing inflation and the insatiable temptation by the Reserve Bank to raise the repo rate and thus further impoverishing workers and suffocating the economy. This unrestrained escalation in the cost of living will poison the upcoming wage negotiations and will automatically push our affiliates to demand above inflation salary adjustments for our members,” the trade union said.