22 May 2002
The South African Communist Party (SACP) welcomes the call on suppliers to reduce the price of food products in the light of the current improvement in the rand-dollar exchange. This call was made yesterday by Whitey Basson, the Chief Executive Officer of Shoprite Group of Companies. This will be an important step forward in ensuring that food prices can be made affordable. However, a sustainable solution is required.
The food price index rose 11,4% in the year to December 2001, compared to a rise in non-food prices of 3%. The prices of maize and other basic foods have risen even further since then. Food price increases are devastating for the majority of our people. Workers typically spend more than a third of their income on food.
Effective policies to end the disproportionate rise in food prices and the food security problem must address the underlying causes. It appears that the main causes of the soaring price of maize, at lest, are not low supply or depreciation, but rather defects in the relevant markets due primarily to speculative pricing and concentration of ownership. The SACP is concerned that the benefit of VAT zero rating on basic foodstuffs is not being passed on to consumers. That means producers and retail chains are profiteering at the cost of the poor. This situation emerges from the fact that in most shops, brown bread, which is VAT exempt, costs the same as or more than white bread.
In the longer-term perspective, high food prices are in part associated with lower investment in agriculture and stagnant production. They are also related to concentration of ownership in production and processing as well as formal retail, and inefficient retail in the townships and rural areas.
The SACP reiterates its call for the consideration of zero-rating of additional basic foodstuffs as a cushion against the worst forms of poverty.
The question of food prices and rise in poverty should also be related to the question of a comprehensive social security programme. As the SACP we reiterate our support for a comprehensive social security system which must include a national health insurance scheme to ensure that our people have access to health care.
The SACP also calls upon poor and working South Africans to use their organisational experience to build co-operatives and a co-operative movement as an important instrument in poverty alleviation and promoting alternative forms of economic ownership. A lot of government funds for poverty alleviation are still not spent. Building co-ops can go a long way in ensuring that these funds are spent for their intended purposes poverty eradication.
An immediate campaign that we also need to take up urgently is that outlined in the President's state-of-the-nation address. We need to embark on a door-to-door campaign to ensure that all those who qualify for state social grants are registered so that they could access these. It is a reality that a number of pensioners, the disabled, orphans, etc, who are supposed to be registered and receiving these grants are not registered. This is an important campaign that the SACP calls on all South Africans to throw their full weight behind.
CONTACT
Mazibuko K. Jara (surname Jara)
Department of Media, Information and Publicity
South African Communist Party (SACP)
Tel - 011 339 3621/2
Fax - 011 339 4244/6880
Email - sacp1@wn.apc.org