Cosatu shocked by increased bread price

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Angelface

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The last sentence caught my attention!

August 03 2007 at 06:28PM

The Congress of SA Trade Unions has called on government to fix the bread price following reports that a major bakery plans to increase its prices.

"Cosatu is shocked at the news that Albany Bakery is to increase the price of its bread by 45 cents a loaf from next Monday. The effect on the poor will be devastating," the federation said in a statement on Friday.

Other big firms were likely to follow suit.

Cosatu said the South African wheat price had risen from R1&nbs;500 to R2 850 a tonne over the past 12 months, or more than 43 percent.

"In the month of June alone, wheat prices went up by 10 percent. The poorest consumers are already reeling from maize going up more than 50 percent so far this year, [and] by five percent in June alone."

These increases would have a knock-on effect on meat, dairy products and processed food.

In addition to pegging the price of bread and other essential foods, government should conducting an inquiry into the way the industry was "dominated by three companies".

Cosatu said it would use the latest food price rises to "intensify its struggles" for substantial pay increases for workers. - Sapa
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but by their own admission the price for wheat has gone up 43% - do they not get that if costs go up then companies are generally forced to increase the price of goods to cover the costs?
 
Apparantly that is a very hard concept to understand. Maybe they'll try Mugabe's approach. Make the producers produce at the price the people demand?
 
I wonder if it has occured to them that getting industry to strike, and incouraging other industries (like with petrol) is also a factor in this.
 
marine1 said:
Once again - If you voted for the current gvt (or didn't bother to get of your lazy fat a$$es) you must live with them.
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I didn't, and I did - but I still have to live with them. Democracy? Phhhht. More like majority by default.
 
TheREV said:
I didn't, and I did - but I still have to live with them. Democracy? Phhhht. More like majority by default.
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that's why they should scrap the NCoP and replace it with a constituency representative house with independent candidates only... but what are the chances...
 
If your inputs become more expensive, your outputs will become more expensive. Pegging the bread price would stop firms from producing bread as it would become unprofitable.

Encourage competition, the firms will lower their prices and the most competitive firms, say the 3 referred to, are those firms which can produce bread most efficiently given their resources, it is by no means a monopoly as implied. Don't punish companies for being more efficient and effective than their competition which had to drop out. These 3 companies also have the infrastructure to produce bread at a cheaper price than 100 small companies. RSA and now Cosatu again has a traditional witch hunt against people and companies who outperform their competition.

Give the farmers a subsidy, the rest of the developed world does it, it will make the bread input (wheat) cheaper.

I don't think Cosatu understands economics as well as they think.
 
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The strike that is presently on and that they are supporting will also likely have an effect on prices such as bread. As they say, you can't have your cake and eat it.
 
The whole country is striking, it only means that people are realising they are poor, but if prices in every sector increase, any wage increases will be countered. The government should lower taxes, have the 1% savings of the companies, put over in to a wage increase.

The one positive I see is that people should soon start to realise the ANC does not have their well being in mind, which is why they are still living in poverty.
 
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