Solidarity petitions Parliament over excessive fuel prices 

1 March 2022

Solidarity today announced that it has drafted a parliamentary petition and is running a huge campaign to pressure the government to deregulate the petrol price and to lower fuel prices.

According to Solidarity, the government has a stranglehold on fuel prices which must be broken. In its petition Solidarity demands that the determination of fuel prices be left entirely to the market so that healthy competition can prevail for the benefit of consumers.

“While the rest of the world embraces the free market, the South African government is clinging to Soviet thinking that is hurting the economy. Determining fuel prices is one such example that is hurting the economy,” Theuns du Buisson, economics researcher at the Solidarity Research Institute (SRI) explains. “It is absurd to treat every filling station in every region in the same way while their immediate market environment, as well as the process of getting the fuel to that point differs. Ultimately, this is to the detriment of the consumer.”

Solidarity contends that most other countries leave the determination of fuel prices entirely to the market and where prices are indeed regulated, it is to keep them low.

Our research shows that in South Africa price regulation is keeping fuel prices artificially high instead. This amounts to deception because the state, which was appointed by us to look after our interests, is thus acting contrary to our interests,” Du Buisson said.

According to Solidarity, it is inconceivable that during one of the most uncertain and challenging periods in the world’s economic history the government is still continuing to push up fuel prices unduly.

“With sky-high unemployment and inflation getting out of control, we can no longer afford a government that is indifferent and insensitive. We must now take action to force the government to act in the interests of South Africans and not in their own. When the price of fuel rises, almost all other products and services also become more expensive, and ordinary South Africans struggle to make ends meet,” Du Buisson states.

Solidarity states that while there are indeed international factors that influence fuel prices the government still cannot justify its own irresponsible actions.

“Apart from the exchange rate and the international oil price that currently make up just under half of the final petrol price, all aspects of the petrol price are determined by the state. First, we still have excessive taxes in the form of the fuel levy and the Road Accident Fund levy. In addition, the profit of every other role player, from the importer, wholesaler, transportation contractor, secondary storage contractor and ultimately to the filling station owner, is prescribed by the state. Solidarity is of the opinion that this amounts to abuse of power. The government has effectively made it unlawful for anyone to compete by offering prices that are lower than that of their competition. Almost everyone in the fuel value chain is forced by law to disadvantage consumers. Things can no longer carry on like this,” Du Buisson argues.

Solidarity explains that it had no choice but to launch an extensive campaign and requests support for this campaign against the government. 

“We ask everyone to sign our petition that will be submitted to Parliament. If enough people make their voice heard the government cannot ignore us. Workers and taxpayers should no longer underestimate their bargaining power. The enormous costs of a power-hungry government are now – perhaps more so than ever before – tangible and quite simply financially unsustainable,” Du Buisson concluded.

To read the full petition, click here.

Issued by Morné Malan, Head of Communication: Solidarity, 1 March 2022