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Shopsteward Volume 27: Special Bulletin

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  |  COSATU Press Statements

COSATU condemns Eskom tariff increases

The Congress of South African Trade Unions has noted with disappointment and anger NERSA's approval of tariff increases for Eskom to the tune of 5, 23% for a period of a year. While we welcome the rejection of the requested 19, 9% increase by Eskom, we still are concerned by this trend of using high electricity tariffs to plug holes and cover for Eskom's wasteful management and corruption.

COSATU notes that credit rating agencies have downgraded Eskom's status to what they call 'junk', but this cannot be used as an excuse to ask consumers to shoulder the whole cost of getting Eskom back on its feet. Government, as the shareholder, must also intervene in a decisive way to help Eskom get out of its financial problems and to raise the funds needed. The issue of State Capture and Corruption cannot be divorced from the Eskom tariff hikes.

Workers and their families have already been slapped with increases in fuel, food and other basic services like health. So consumers can't afford any further increases in the cost of living and will be devastated by this latest blow from Eskom, which will plunge even more people into poverty.

In the long-run the tariff increases will have even more serious consequences for the economy. Electricity is a major part of the running costs of nearly all companies. Many will become unviable and start to retrench workers and fewer new businesses will get started.

This will slow down economic growth even further and have a catastrophic impact on an already limping economy with high levels of unemployment, at more than 36%, and more than 50% of South Africans living in poverty, according to Stats SA.

Increases in the cost of living will also leave consumers with less disposable income ,which will put the economy further in trouble. The importance of the purchasing power has been demonstrated in the relatively high economic growth rate and more job creation in the US, which has introduced a national minimum wage.

Issued by COSATU

Sizwe Pamla (Cosatu National Spokesperson)

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