IFP PRESS STATEMENT BY: 
Mr HJ Bekker MP
IFP ECONOMIC AFFAIRS SPOKESPERSON

18th June 2008

The Inkatha Freedom Party would like to congratulate the National Energy Regulator of South Africa (Nersa) for NOT granting Eskom's proposed 53% tariff increase, said the IFP's Spokesperson on Economic Affairs, Mr Hennie Bekker, today. 

Mr Bekker commented: "When we made our submission to Nersa in May we said that we would prefer any increase to be in line with inflation as anything more than this, in the current economic climate, will only contribute to the vulnerability of the many South Africans who would not be able to afford such a drastic increase. 

"We called on Nersa not to implement a rate of more than 10 percent p.a. above inflation and that this should be phased in over a time period of about five years (that would mean that for 2008/09 the increased rate should not exceed 18 percent).  

Mr Bekker continued: "The IFP would therefore like to congratulate Nersa for taking our submission into consideration, and we believe that today's decision was the right way to go. 

"A massive once-off price increase will have done more harm than good as we believe that a sharp increase in electricity price could have triggered off a spate of rises, including a lending rate increase before the Reserve Bank's scheduled meeting in August. 

"This 13% increase as approved by Nersa today should not disrupt the SA economy to the extent that a massive once-off increase would have, which is another important factor to the IFP, as we believe that economic growth is of paramount importance to our country's future," concluded Mr Bekker.