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Finance minister Enoch Godongwana. Picture: SUNDAY TIMES/ESA ALEXANDER
Finance minister Enoch Godongwana. Picture: SUNDAY TIMES/ESA ALEXANDER

Finance minister Enoch Godongwana has called for changes to the way the fuel price is calculated, after the cost of petrol rose to a record this month.

Regulated fuel prices, which include a levy used to finance a fund to compensate those involved in road accidents and other taxes, have jumped 40% this year. The price increased 3.8% last week to R20.29 rand a litre in Gauteng, SA’s commercial hub.

Godongwana is concerned about the increase in fuel costs “to the extent that we may have to play a role, to do whatever we can, to support the reform of the fuel price,” he told lawmakers on Friday in parliament.

Data due out on December 15 is expected to show headline inflation accelerated to 5.5% in November from 5% in October, driven by fuel and food costs. The price-growth measure has been above the 4.5% midpoint of the central bank’s target range at which it prefers to anchor expectations since May.

Energy minister Gwede Mantashe told lawmakers that separating the fuel levy from prices would be “helpful.”

“At this point in time a big part of the price increases is the levy,” he said. “The way of countering price increases is an urgent matter for review and that is on the table.”

Bloomberg News. More stories like this are available on bloomberg.com

SA's finance minister has called for changes to the way the fuel price is calculated. Picture: BLOOMBERG
SA's finance minister has called for changes to the way the fuel price is calculated. Picture: BLOOMBERG
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