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3 March ’22 Wrap: The price of EVERYTHING is going up

Hi there 🙋🏽‍♀️ in this week’s edition of The Wrap, we’re looking at the high – and rising – cost of living (it may be time to push your car to work and back to save on both petrol and gym fees), update you on the latest developments in the ongoing Russia-Ukraine crisis and summarise some of the juiciest findings from the latest state capture commission report. Plus, Hollywood’s awards season is underway.

So, let’s dive into your weekly update of empowering and easy-to-understand news, brought to you by Verashni Pillay and the explain.co.za team. 😄

Format

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🗞 For text, keep scrolling.

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1. Our take: Tighten your belt(some more)

Just when we thought we were past the Janu-worry blues, the latter half of Febru-worry emerged from the shadows and whacked us with price hikes across the board.

🔹Petrol

The petrol price increased to a whopping R21.60/L inland and R20.88/L in coastal areas on Wednesday. This is the first time the price of petrol shot past the R20 mark (it hit R20 for the first time last year). The recent increase was slightly cushioned by the rand’s stronger performance over the past couple of months, but as the conflict between Russia and Ukraine escalates, we’re likely to see more increases. 😱

We’ve previously explained that fuel prices are determined by three factors: 

1. Fuel import costs, 

2. Government’s regulation of the costs and profits for wholesale retailers (the guys who supply petrol stations) and the services that transport fuel, 

3. Tax and levies that go towards the Road Accident Fund. 

Finance minister Enoch Godongwana thankfully did not increase the fuel levy referred to in point 3 during his recent budget speech; it’s at R6.11/L. But government also has very little space to manoeuvre because it used up the internal buffer called the “slate levy” that it usually relies on to protect us from petrol increases. The South African National Taxi Council said it may look at increasing taxi fares after avoiding doing so for some time. 

The price of fuel also increased in some parts of Europe and Britain this week. 

🔹Food

Bad news here too, according to the latest Household Affordability Index. The index looks at the cost of an average household food basket, made up of 44 core food items most frequently bought by the lower-income households that make up most of SA. 

It found that the cost of this basket increased to R4 355.70 in February 2022 from R4 001.17 at the same time last year. Only five items – rice, potatoes, curry powder, stock cubes and green pepper – became cheaper, and maize meal stayed the same. Again, the ongoing Russia-Ukraine conflict comes into play:  according to agri-economist, Wandile Sihlobo, the price of some commodities, especially wheat, is set to rise. 🫑 

🔹Electricity

Last week, the National Energy Regulator of SA (Nersa) approved a 9.1% increase in electricity prices, which will come into effect on 1 April (how appropriate for South Africans, who feel we’re being taken for fools). Thankfully this is nearly half the 20.5% increase Eskom controversially applied for in January! The utility isn’t thrilled about not getting more, while opposition parties say 9.1% is still too high – and it’s above inflation. 

There’s no sugarcoating here: It’s going to be tough. Expect your budget to increase, keep your existing costs down and don’t take on any more expenses. 

2. The big story: Russia is cancelled

Things are escalating at an unimaginable speed in Ukraine. 

As we reported last week, Russia invaded parts of Ukraine and launched missiles at cities, including the capital, Kyiv. This came after Russian President Vladimir Putin announced that he formally recognised separatist regions of Ukraine led by pro-Russian rebels.

Here’s what has happened in the past week: 

🔶 By day eight of the conflict, the UN recorded at least 227 civilian deaths but said this was likely to be higher. Nearly one million Ukrainians have already fled the country. 

🔶 Russia and Ukraine held talks in Belarus, which borders both countries, on Monday but there was no resolution. They will meet for a second round of negotiations.

🔶 The International Criminal Court will, after obtaining the support of 39 countries to do so, begin an investigation into possible war crimes by Ukraine’s then-government, which was aligned with Russia, back in 2013.

🔶 Russia has taken complete control of Kherson, a key port city right at the bottom of Ukraine on the Black Sea coast. It has forced its way into the city council buildings and imposed a curfew on citizens. The capture of Kherson has raised fears that Russia is creating a military base to push further inland into the rest of the country. 

🔶 A number of sporting fraternities, including soccer body Fifa, have banned Russia from participating in their events. In tennis, Ukraine’s Elina Svitolina said she would not compete against a Russian or Belarusian athlete for the foreseeable future.

🔶 In news and entertainment: SA’s MultiChoice stopped airing Russia’s state news channel, Russia Today, due to EU sanctions; Apple will stop selling its products and providing services like Apple Pay; Netflix will pause projects and acquisitions in Russia and Spotify closed its Russian offices until further notice, citing safety concerns. The Cannes and European Film festivals will neither allow Russian delegates and attendees nor showcase Russian productions. 

What does all this mean for us here in SA? The conflict has a significant impact on the global economy, especially when it comes to trade. Russia is a big player in energy exports, while both Russia and Ukraine are major exporters of wheat and corn. We’re already seeing the price of fuel increasing across the globe, as we mentioned in our first story. Less stable emerging market currencies like our own will also be affected. They say that when the US sneezes, the world catches a cold – and it seems that when Russia starts a war, the globe catches pneumonia. 

Briefs

3. Ramaphosa appoints new NPA investigative head

Our National Prosecuting Authority (NPA) is in charge of proving that crooks belong in jail and its Investigating Directorate is central to that role. So it was a blow when its head, Hermione Cronje, resigned in December citing exhaustion and frustrations about the directorate’s operations; she reportedly struggled to pursue key state capture prosecutions because of limited resources and budget. Cronje served her last day on Tuesday and we were all prepared for a long wait for a replacement as President Cyril Ramaphosa isn’t exactly known for taking fast action (on that note it’s been 142 days since we’ve had a permanent Chief Justice. 👀) 

Thankfully, also on Tuesday, Ramaphosa announced a slew of appointments including Advocate Andrea Johnson as Cronje’s replacement. 

The good news is Johnson is an impressive choice for the job. She led investigations and prosecutions against the likes of mining millionaire Brett Kebble and Jackie Selebi, SA’s notorious former national police commissioner, as well as appearing alongside Gerrie Nel in Oscar Pistorius’ murder trial. Johnson was previously interviewed to head up the NPA in 2018; that post went to Advocate Shamila Batohi. With 25 years of experience, Johnson has been described as a “no-nonsense” person, who has a knack for getting things done.

The appointment comes on the back of concerns that the NPA is delaying high-profile prosecutions and follows the release of the three-part state capture report. South Africans are getting impatient and we’ve previously noted concerns with the NPA. Hopefully, things will be different for Johnson when it comes to resources: the last budget allocated funds to appoint 90 people in her unit. 

4. State Capture Report: The (next) sequel

After years of listening to testimony, Justice Raymond Zondo is under pressure to produce results and he’s been putting out reports apace since January: the third and final report of the Zondo commission of inquiry was released this week and features Zondo’s most significant findings against former President Jacob Zuma to date, recommending he face prosecution for probably violating the Prevention and Combating of Corrupt Activities Act. 

But what’s the report about? At 942 pages, It focuses on all things Bosasa – the prison and security company owned by the late Gavin Watson. According to the report the company was awarded at least R2.37 billion since 2000 but a previous M&G report put that number closer to  R12 BILLION. 😲

Bosasa’s modus operandi was to target prominent government officials and dispense largesse in exchange for their promise of influencing tender-awarding processes, as the Daily Maverick noted

ANC chairperson Gwede Mantashe and former Environmental Affairs Minister Nomvula Mokonyane also play starring roles in the report for receiving benefits from the company, from security upgrades to a lavish 40th birthday, in Mokonyane’s case. 

The report recommends that Zuma and Mokonyane be prosecuted by the NPA. Mantashe should be investigated further, it says.

The NPA was allocated R1.1bn in the recent budget for the next three years but it needs much more. Justice Minister Ronald Lamola pointed out in parliament this week that government coffers will never have enough to meet the demand on prosecutors in light of Zondo’s findings. So the NPA is working with Treasury to explore donor funding without undermining its independence, according to Lamola. We’re guessing there’ll be plenty of donors to support a cause like this. We’re just not looking forward to the accusations of “white monopoly capital” that will no doubt follow. 🙄

5. Accountability Monitor: Ramaphosa’s police clean-up campaign

During his State of the Nation address last month, President Cyril Ramaphosa said that he would set things straight in the SA Police Service, especially after it failed to properly handle events around the July riots. We saw him start to make good on that promise this week when he fired national police commissioner General Khehla Sitole after they reached a “mutual agreement”. Sitole’s name has also been mentioned in one of Zondo’s state capture reports. Evidence showed that he was involved in procuring phone tapping devices ahead of the ANC’s 2017 Nasrec conference. He also faces two criminal charges for failing to cooperate in an investigation related to the assassination of anti-gang unit commander, Charl Kinnear. 

But Ramaphosa is getting flack for allowing police minister Bheki Cele to keep his job. Cele was also responsible for failing to keep things under control during July’s lootings, which caused enormous damage to our economy and international standing. Sitole and Cele do not see eye to eye and this may have led to poor coordination of policing during that chaos. Ramaphosa is putting his feelers out for a new police commissioner, but the question remains, what happens to Cele? Political analyst Ralph Mathekga said Ramaphosa was playing safe ahead of the ANC conference this year and did not seek to create “ further unhappiness in KwaZulu-Natal, where Cele hails from”. The South African Human Rights Commission found that Cabinet must take full responsibility for the events of July 2021 and this is Ramaphosa’s first stab at doing so. 

While we’re talking about accountability, the NPA’s Hermione Cronje scored a win on her last day in office: After months of wrangling, Interpol issued red notices for Atul and Rajesh Gupta. This restricts their travel and paves the way for their eventual extradition to SA to face justice. The net is closing on the masterminds behind the state capture project.   

6. #Adulting: Booking for your driver’s licence

Two updates here:

🔹_Your licence_

Several licensing centres across Gauteng have been closed after the National Driving School Association of SA protested against a new online driving licence and testing booking system. The new system saves you and me a buck, as we can make bookings ourselves, without necessarily going through third parties like a driving school instructor. 🚗  Previously, a driving school instructor could financially benefit from booking a slot for a learner driver; the new system means they lose some money. There have also been complaints of instructors over-booking slots to make more money – the new system essentially prohibits this practice. The association said it will take legal action to suspend the new system. 

The system that’s caused all the trouble was launched last month in an attempt to curb the inconvenience of physically going to booking centres and waiting in queues, as well as removing the risk of spreading Covid-19, the Road Traffic Management Corporation said. The new system can be accessed via the government’s driving licence portal. 

🔹_Your municipal bill_

If you’re a Joburg resident, you’ll be pleased to know that the City of Johannesburg has decided to extend its Debt Rehabilitation Programme. The programme was to expire this week but has been extended until 30 June 2022. If you’re indebted to the city, you can get up 50% written off.  The programme is meant to ease the financial burden on ratepayers, especially amid the Covid-19 pandemic. The debt write-off only applies to residents whose combined property value is below R1.5m, for NGOs and other businesses that make less than R3m. For account holders to qualify for a 50% debt write-off, they must be in arrears for more than 90 days with a gross monthly income below R22 000. 

7. Hollywood’s awards season is here!

It’s awards season in Hollywood. Some Covid habits persist: these grand affairs are still being held via hybrid setting, combining at-home attendance with some in-studio production. 

Two major ceremonies happened in the past week: the 28th Screen Actors Guild Awards and the 53rd NAACP Awards, which recognise achievements by entertainers of colour (historically the NAACP fought for African American civil rights). 

The streaming giants were the Screen Actors Guild Awards’ big winners; with Apple TV+’s “Ted Lasso” (Britain) and Netflix’s “Squid Game’ (South Korea)’ winning the best comedy and drama categories, respectively.  

At the NAACP Awards, multi-hyphenate Jennifer Hudson was the star of the evening. She walked away with the title of Entertainer of the Year, beating out some of the hottest hip hop stars of the moment like Lil Nas X and Megan Thee Stallion, and scooped Outstanding Actress in a Motion Picture. Hudson was handpicked by her mentor, the legendary (and now sadly late) singer Aretha Franklin, to play Franklin in the biopic “Respect”. 💃🏾 

There were some raised eyebrows over an NAACP award to Prince Harry and his wife Meghan Markle. The pair have done some charity work and partnered with the NAACP. But some on social media noted that others had done more and were more deserving of the award.

Harry is part of an institution that, for many, symbolises centuries of racial oppression. Plus there are his own pre-woke days of hanging out in mostly white clubs, dressing up like a Nazi officer at a “Colonials and Natives” party in his youth, calling a fellow army cadet a “Paki” and telling another that he looked “like a raghead”. Ja, no, hey. As one columnist put it: “Over the course of the last six months, as Harry has spoken out more regularly about social justice and systemic racism… he has never, ever explicitly addressed his own past.” 

8.  The “nonsensical” census

The 2022 census, which kicked off at the start of February, is said to be the most important to be undertaken since the end of apartheid. It comes against a backdrop of state capture, a pivotal change in politics and leadership, soaring cases of gender-based violence and, of course, the Covid-19 pandemic. This is the fourth census South Africa has run since apartheid ended; the last was in 2011. 👨🏿‍🤝‍👨🏾

But the LGBTQI+ community has raised concerns that the survey conflates gender and sex, and fails to include intersex people or questions related to sexual orientation. Intersex people have any of a number of sex characteristics and so, says the Office of the United Nations High Commissioner for Human Rights, “do not fit typical binary notions of male or female bodies”. “Sex” refers to an individual’s biology, while “gender”, a social construct, refers to how an individual identifies. Activists argue that the exclusionary nature of the survey means the data will be inaccurate, and the needs of this community will not be met. There have been calls to amend the survey, but Stats SA has said it is drawn up using UN guidelines. 🤷

That’s it from us at The Wrap, an award-winning product of explain.co.za – simple news summaries for busy people. 💁🏾‍♀ 

The Wrap is sponsored by explain’s agency division. We specialise in content marketing for purpose-driven organisations, often with a pan-African reach. Mail info@explain.co.za for a quote. 

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_Till next time, goodbye from the team_ ✌🏽