WATCH YOUR wal­let IN 2015

As the New Year be­gins, it is shap­ing up to hit your pock­ets hard. Ev­ery­thing that is con­sumed is go­ing up, ex­cept for the price of petrol. Be­low is an ex­am­i­na­tion of what things will likely cost you. Moy­agabo Maake un­packs the prospects

CityPress - - Front Page -

ELEC­TRIC­ITY

TheN­ational En­er­gyReg­u­la­tor of SA­grant­ed­power util­ity Eskom per­mis­sion to in­crease tar­iffs by an av­er­age of 8% for each year to 2018. The reg­u­la­tor’s guide­lines for mu­nic­i­pal­i­ties set their tar­iff hikes at 9.25% from July this year. But in Oc­to­ber, the reg­u­la­tor granted Eskom a one-off hike of 12.69% fromApril this year to re­cover its costs – trans­lat­ing to a 14.24% hike for mu­nic­i­pal­i­ties.

If the City of Joburg opts to use th­ese guide­lines, res­i­dents us­ing 480kwh of elec­tric­ity a month – at a cost of be­tween R413.76 and R498.82 – can ex­pect to pay be­tween R472.68 and R569.85. In Cape Town, the cost for 480kwh could rise to R505.15 (sub­sidised life­line tar­iff ) and R842.43 for do­mes­tic users.

PETROL

The depart­ment of en­ergy is set to an­nounce the third “sig­nif­i­cant” fuel price cut this month, which should pro­vide a bit of re­lief for your pocket.

“The ex­pected de­crease is due to a fall in crude oil prices,” de­part­men­tal of­fi­cials said last month.

A mar­ket over­sup­ply, cou­pled with a decision by Opec to forge ahead with cur­rent pro­duc­tion lev­els at its Novem­ber meet­ing in Aus­tria, has pushed crude prices to five-year lows. By Thurs­day, the price was at $57.33 a bar­rel.

It ap­pears the sup­ply glut will not abate soon – early last month, the In­ter­na­tional En­ergy Agency re­vised its out­look for global oil de­mand growth by 230 kilo­bar­rels of oil a day to 0.9 megabar­rels a day. This was based on lower ex­pec­ta­tions for the for­mer Soviet Union and other oil-ex­port­ing coun­tries.

Opec will meet again in June. Bar­ring a sig­nif­i­cant de­pre­ci­a­tion in the ex­change rate, ex­pect fur­ther petrol price cuts un­til at least then.

IN­TER­EST RATES

Eco­nomic data has left the SA Re­serve Bank much room to leave in­ter­est rates, cur­rently at 5.75%, un­changed.

“Low credit growth to house­holds sug­gests there is lit­tle need to raise rates to curb ex­cess de­mand,” Ned­bank econ­o­mists Jo­hannes Khosa and Den­nis Dykes said this week.

But loom­ing changes to US mon­e­tary pol­icy have econ­o­mists pre­dict­ing a rate hike later this year.

In­vestec’s Annabel Bishop ex­pects the SA Re­serve Bank to inch up rates to a to­tal of 75 ba­sis points through the year, end­ing up at 6.5%.

No­mura’s Peter At­tard Mon­talto ex­pects rates to reach 7.5% by the end of the year if in­fla­tion­ary pres­sures force the SA Re­serve Bank to hike rates; and RMB’s John Cairns sees the Re­serve Bank adding another 50 ba­sis points to bring rates to 6.25%, but only by next year.

The bot­tom line: with the prime rate pegged at 3.5 per­cent­age points above the SA Re­serve Bank’s rate, pre­pare to pay in­ter­est of be­tween 10% and 11% plus the mar­gin your bank charges you on your bond and car in­stal­ments by the end of the year.

WA­TER

Ac­cord­ing to Cape Wa­ter So­lu­tions, a “typ­i­cal” house­hold uses 250 litres of wa­ter daily, or 7 500 litres (7.5 kilo­litres) a month.

The cost of wa­ter pro­vi­sion in Joburg has es­ca­lated by an av­er­age of 5.43% over the past three years, com­pared with 22.54% in Cape Town.

If both met­ros stick to the trend this year, ex­pect to pay R37.80 to R48.87 in Joburg and R91.72 in Cape Town from July.

ED­U­CA­TION

As pub­lic school pupils anx­iously await their ma­tric re­sults, par­ents are prob­a­bly more anx­ious about hav­ing to dig deep for their chil­dren’s ter­tiary ed­u­ca­tion fees.

First-year tu­ition for a BCom de­gree at the top five lo­cal univer­si­ties, as ranked in the QS World Univer­sity Rank­ings, will cost: Univer­sity of Cape Town – up to R63 000 Univer­sity of theWit­wa­ter­srand – up to R43 780 Stel­len­bosch Univer­sity – up to R46 338 Univer­sity of Pre­to­ria – up to R39 610 Univer­sity of KwaZulu-Natal – up to R31 226 Par­ents who want to en­rol their chil­dren in the coun­try’s best per­form­ing schools – those that have pro­duced a 100% pass rate since the in­cep­tion of the Na­tional Se­nior Cer­tifi­cate in 2008 – can ex­pect to pay any­thing be­tween R9 000(Kim­ber­ley Girls’ High School) and R105 520 (Bishops Dioce­san Col­lege, Cape Town) this year.

MED­I­CAL AID

Dis­cov­ery Health, which has cor­nered more than half of the open med­i­cal schemes mar­ket, has upped con­tri­bu­tions on all of its ben­e­fit op­tions by an av­er­age of 9.1% – above the SA Re­serve Bank’s in­fla­tion fore­cast of 5.3% for this year.

A main mem­ber with an adult de­pen­dant and one child on the Ex­ec­u­tive plan, Dis­cov­ery’s costli­est, can ex­pect to pay R8 978 each month. The cheap­est plan, the KeyCare Core, which of­fers cover to per­sons earn­ing less than R7 050 and their de­pen­dants, will cost R1 255.

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