South African households are confronting a relentless squeeze on their wallets, as essential goods and electricity bills continue to climb.
Image: File/ Independent Newspapers
South African households are confronting a relentless squeeze on their wallets, as essential goods and electricity bills continue to climb.
This is according to the second Cost of Living Report released by the Competition Commission on Wednesday, which found that staples such as maize meal, bread, eggs, and cooking oil remain stubbornly expensive, while rising electricity tariffs are adding to household pressure even with headline inflation averaging 3.2% in 2025 and reaching 3.6% in December.
The report noted that non-food essentials, particularly electricity, remain a key driver of cost pressures, with Eskom’s bulk tariffs rising by 11.3% and some municipalities implementing increases of up to 15%.
"Following the annual utility tariff increases implemented in July2025, electricity prices rose sharply, with cumulative electricity inflation increasing to approximately 85% over the five-year period (prior to the July 2025 adjustment, the cumulative price increase from 2020 to June 2025 was 68%)," the report noted.
"Water supply inflation similarly recorded a notable acceleration following municipal tariff revisions, with the price of water supply increasing by 68% over the five-year period (prior to the July 2025 adjustment, the cumulative price increase from 2020 to June 2025 was 50%). In contrast, cumulative headline inflation remained relatively contained during the latter part of 2025 at just over 30%."
The commission warned that this growing "divergence between administered prices" and overall inflation is placing pressure on household finances, particularly for lower-income consumers.
"The persistence of these increases reflects deeper structural challenges within the utility sector, including ageing infrastructure, high debt burdens, operational inefficiencies, and the need for ongoing capital investment to stabilise service delivery".
The report noted that GP fees, transport, school fees, and insurance continued rising with sector-specific inflation, but increases were smaller than those for electricity.
On food items, staples such as maize meal, brown bread, eggs, IQF chicken, and sunflower oil remained high, while canned pilchards and some breads showed only modest price relief.
Commissioner Doris Tshepe said that the Competition Commission was calling for tighter oversight.
“Addressing the cost of living requires greater scrutiny of administered price-setting mechanisms, enhanced transparency and accountability in tariff determinations and targeted protection for vulnerable households.”
Meanwhile, Alexforbes has processed and paid out over one million savings pot withdrawal claims since the launch of South Africa’s innovative two-pot retirement system, further telling a compelling story of how South Africans are dipping into their retirement savings just to make ends meet.
IOL BUSINESS
mthobisi.nozulela@iol.co.za