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Today, the Reserve Bank Monetary Policy Committee announced an increase of 50 basis points in the repo rate, signifying that debt servicing costs will rise during a time when our nation is grappling with an ANC-triggered cost-of-living crisis.

Today's announcement serves as a measure to mitigate the damage caused by the ANC's anti-poor fiscal policy framework and the party's inability to respond to the soaring cost of living and growing food insecurity.

Government has failed in its primary responsibility to ensure that an environment conducive to economic growth exists and has sat back as the spending power of South African households absorbs one blow after the other. Instead, it ensures that its cronies are well protected and cushioned from this reality.

Alarming inflation data released last week exposed the true magnitude of the crisis - annual inflation for overall goods has soared by 7.1%, with transportation costs rising by an astonishing 9.9%. In 2022 alone, the retail prices of white and brown bread shot up by 20% and 19%, respectively. Maize meal prices surged by 32%, leaping from R26.62 to R35.29. These steep increases hit impoverished and vulnerable South Africans the hardest.

Yet, the ANC government remains indifferent. ANC ministers are far removed from the harsh realities everyday South Africans confront. Instead of establishing fiscal policies to cushion the impact of rising prices and constant power outages, they squander tens of millions of Rands in taxpayer funds on their own water and electricity bills at state-owned official residences.

Active steps can be taken to shield hard pressed households from this growing storm. The DA has a comprehensive plan to relieve the burden on vulnerable households. Although Finance Minister Enoch Godongwana has dismissed our proposals, we continue to urge government to immediately expand the zero-VAT rated food basket to include essential items like bone-in chicken, beef, canned beans, wheat flour, margarine, peanut butter, baby food, tea, coffee, and soup powder. VAT on these products disproportionately affects the poorest 50% of South Africans, who are already battling to keep food on the table.

Moreover, abolishing the fuel levy is an easily implementable and affordable solutions that would instantaneously lower petrol prices, transportation costs, and food prices, while enhancing the solar tax rebate will aid in curbing inflationary pressures by assisting producers in becoming independent of Eskom’s incompetence and NERSA's impending electricity price hike.

The DA will not passively observe as an incompetent and uncaring government persists in playing politics with people's lives. We will intensify pressure on the government to adopt viable economic policies and promptly tackle the cost-of-living crisis, especially concerning food prices.

In 2024, the DA will unseat the ANC government and establish a climate that encourages both consumer and business-friendly conditions while addressing the challenges faced by economically marginalized South Africans. The future beckons – the DA will seize it.

Issued by Dr Dion George MP - DA Shadow Minister of Finance