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
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.
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.
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.
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.
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.
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.