Cabinet committee established to handle rising fuel costs - Godongwana

Minister of Finance Enoch Godongwana said a Cabinet committee has been established to determine what should be done about rising fuel costs owing to the United States (US)’s war on Iran.

He was pressed on the matter in the National Assembly on Wednesday on a question about the recent judgment of the Western Cape High Court that ruled his power to unilaterally determine the value-added tax rate (VAT) to be unconstitutional.

While Godongwana said he’s yet to decide whether to appeal that ruling, the matter of the fuel levy is a separate issue, which he was only answering because it’s in the public interest.

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With the Constitutional Court still to confirm March’s High Court ruling that has given Godongwana two years to amend the law and transfer his power to determine the VAT rate to Parliament, Godongwana said he’s still to decide on the next legal steps.

“I have sought legal advice and will make a decision based on that advice, and, at the moment, I’ve not yet firmed up a decision.”

Questioned by the Democratic Alliance (DA)’s Matt Burke on whether he will accede to the party’s proposal made on Wednesday to cut fuel levies by 50%, after raising the general fuel levy by 21 cents a litre in February’s budget, Godongwana said the question was irrelevant to the original VAT question.

But the Economic Freedom Fighters (EFF)’s Sam Matiase continued to press the issue, prompting Godongwana to reveal the establishment of a Cabinet committee of which he is a part to consider the impact of the Middle East war in general.

Other members of the committee include Minister of Mineral Resources and Petroleum Gwede Mantashe and Minister of Electricity Kgosientsho Ramagopa.

“Among its terms of reference is to say what is it suggesting government to do on the fuel price.”

While the finance minister has the sole prerogative to decide on fuel levies, which make up the overall cost of the petrol price, Godongwana said he won’t be exercising this decision alone in light of the latest global fuel price crunch.