Mungo Soggot
THE petrol price is expected to drop 8c/litre from Wednesday in the wake of a stable rand for most of last month and a softening in international fuel prices.
Motorists would have enjoyed a 9,5c a litre decrease, but it is understood Transport Minister Mac Maharaj has taken advantage of the favourable fall and secured a 1,5c/l increase in the levy on the fuel price which feeds the state accident insurance fund, the Multilateral Motor Vehicle Finance Fund (MMF).
South Africa’s regulated fuel price includes various fuel levies, fixed margins for retailers and wholesalers — the rest of it is based on movements in international fuel prices and the fate of the rand.
The MMF levy on the diesel price is expected to go up 1c/l, while the diesel price itself will drop 4c/l in line with currency and price movements.
The Transport Department could not be reached for comment, but it is understood the decision took place after consultation with the Minerals and Energy Affairs and Finance ministries.
The department has complained that the MMF is heavily in need of cash to meet outstanding claims. Maharaj is planning a controversial revamp to the way the state accident insurance scheme works. He is proposing a “no-fault” scheme, which the MMF will administer as there will no longer be a need to prove negligence. For actuarial reasons, the scheme is expected to cost much more, and will require several increases in the levy. In the draft White Paper, Maharaj works on the assumption the levy will stand at 12c/l from May. The latest increase has brought the levy to 10,5c/l.
It is understood the fuel companies were hoping the government would take advantage of the drop to increase their wholesale margin, which has remained static for 18 months.
Transnet economist Mike Schussler said the collapse of the rand should rule out a decrease next month.