Pointing out that the electricity price increase allowed by the National Energy Regulator of South Africa (Nersa) is more than twice the current rate of inflation, the Congress of South African Trade Unions (Cosatu) has rejected it as much too high.

The unionists are also concerned at the comment of Nersa chairman, Collin Matjila, that he projects power tariff hikes of 20-25 percent over the next three years.

A statement issued by Cosatu on Wednesday said that the increase will directly hit the living standards of consumers already battling to survive massive increases in the price of food, fuel and interest payments.

"While welcoming the regulator's statement that the additional tariff increase should not be applied in respect of poor households, we will need to study how this will operate in practice," the federation said. "We still demand that social grants and minimum wages for workers covered by sectoral determinations be increased to offset the impact of all these increases."

Cosatu's spokesperson Patrick Craven said in the statement that the unions also remain extremely concerned at the threat to jobs, at a time when businesses are being hit by the other runaway increases in loan repayments, and fuel costs. "It will certainly discourage people setting up new businesses and creating jobs and will inevitably show down the rate of new job creation," Craven said.

"The workers should not have to pay the price for an energy crisis for which they are not responsible by losing their jobs and suffering a big drop in their living standards."

The federation promises therefore to continue with rolling mass action against rising prices and the threat to jobs, which begins with provincial action on 9 July 2008 and culminates in a national stayaway on 6 August.

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