A survey conducted by Debt Rescue shows that as many as 81% of respondents are cutting down on daily meals because they can no longer afford them, while 41% say that their monthly grocery budget can no longer feed their families.
“The price of basic foodstuffs has risen astronomically over the past year. Accelerating inflation plays a huge role in this as it affects the financial stability of the average consumer. Steep inflation is causing expenditure to increasingly exceed the income of the average person, and people are feeling desperate and out of control financially.
“What’s more, many expect to feel even less in control of their finances going forward,” said CEO of Debt Rescue, Neil Roets.
South Africa’s annual inflation rate rose to a high of 7.8% in July 2022, above market expectations of 7.7% and the upper limit of the South African Reserve Bank’s target range of 3-6%. This, on the back of a steep hike to 7.4% in June, from 6.5% in May, making the June rate the highest in 13 years.
The latest consumer price information shared by Stats SA indicates that year-on-year increases in transport costs (up by 25% vs 20%); food and non-alcoholic beverages (9.70% vs 8.60%); housing and utilities (4% vs 5.10%) as well as miscellaneous goods and services (3.60% vs 4%) are the main contributors.
Fats and oils, bread, and cereals – products that are essential to preparing nutritious meals – currently carry the highest food price inflation at 36.2% and 13.7%, respectively.
“The fact that the South African Competition Commission has noted a sharp increase in staple foods in South Africa – which may be at risk of price gouging by retailers – is disturbing,” said Roets.
“When the businesses that profit the most are contributing to the demise of their own customers – among them their own neighbours, friends and associates – I think it’s safe to say we are in trouble with a capital ‘T’,” he said.
“Inevitably, inflation hits the most vulnerable the hardest,” Roets added. “For lower income groups, the inflation basket tends to be heavily skewed towards transport, food and education, and any significant price rise in those elements has a much bigger impact on those households.”
The group’s survey highlights that for the vast majority of consumers, by far the most pressing issue right now is simply being able to afford to feed their families every day. “When 56% of people are supplementing meat with other items and replacing a nutritious balanced lunch with sandwiches, it’s time to sit up and take notice,” said Roets.
The August 2022 Household Affordability Index, which tracks food price data from 44 supermarkets and 30 butcheries across the country, shows that prices continue to skyrocket, with an increase in the average cost of the Household Food Basket of R26,72 (0.6%) – a price jump from R4,748 in July 2022 to R4,775 in August 2022.
This is confirmed in the survey results, where 94% of participants stated that they saw significant increases in the price of cooking oil, and 68% in bread prices, said Debt Rescue 68% of survey participants have incorporated more potatoes and rice in their meal planning to stretch meals and reduce costs.
South Africans are increasingly relying on their credit and store cards to put food on the table, leading to a debt trap they cannot easily get out of,” said Roets.
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