The Competition Commission's latest Cost of Living Report highlights alarming increases in electricity and food prices in South Africa in recent years.
Image: File.
The Competition Commission has sounded the alarm on the rising cost of living in South Africa, revealing that the prices of essential utilities like electricity and water have skyrocketed far beyond the national inflation rate over the last six years.
The Commission released its second Cost of Living (COL) Report on Wednesday, tracking the affordability of basic goods and services from 2020 through to January 2026. The findings paint a grim picture for household budgets, particularly for low-income families who spend a disproportionate amount of their earnings on basics.
According to the report, electricity prices surged by a staggering 85% between 2020 and early 2026. Water prices followed a similar upward trajectory, rising by 68%. Both figures dwarf the overall consumer price inflation, which sat at 30% for the same period.
The Commission attributed these "entrenched" costs to structural failures within the utility sector, citing ageing infrastructure, high debt burdens at entities like Eskom and Rand Water, and operational inefficiencies.
"Under the current pricing system, recent reforms may not translate into quick relief for households," the report noted, specifically highlighting how municipal mark-ups often "add costs on top of costs."
The report also took a deep dive into the food value chain, monitoring the "spread", the gap between what a producer receives and what a consumer pays at the till.
The Commission flagged a phenomenon known as "rocket and feather" pricing: where retailers are quick to hike prices when costs go up (like a rocket) but are painfully slow to drop them when costs fall (like a feather).
Key food items under the spotlight include:
Parents are also facing a heavy burden. Since 2020, the cost of primary education has risen by 37%, while secondary education has jumped by 42%. The Commission linked these hikes to insufficient government funding, which forces schools to cover operational shortfalls through increased fees.
In the healthcare sector, general practitioner (GP) consultation fees continue to outpace headline inflation; however, increases in 2026 are expected to stabilise around 4.2%, in line with medical inflation.
While petrol prices showed some stability between April 2025 and January 2026, the Commission warned that the reprieve might be short-lived. Renewed instability in the Middle East has pushed oil prices higher, which is expected to drive up fuel and transport costs from April 2026.
"Addressing the cost of living requires greater scrutiny of administered price-setting mechanisms and enhanced transparency," said Commissioner Doris Tshepe.
Without targeted protection for vulnerable households, Tshepe warned that cost pressures would continue to limit gains in household welfare and slow the country’s broader economic recovery.
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