It’s beginning to hurt

More and more of the column inches of the newspapers in South Africa are being devoted to inflation, interest rates, petrol prices and the cost of living. While the entire world is suffering the slings and arrows of outrageous oil prices and the so called “credit crunch”, South Africa – as a developing economy – has taken a harder hit than most.

Being a weaker currency than those of the developed economies, our Rand has taken a bit of a battering. This means that imported goods are more expensive – and that includes oil. And – as you may know (unless you’ve been hiding out in a cave with Osama) – oil has also been going up pretty quickly anyway.
The effect of this is known in economic circles as “compound misery”.
So – because everything costs more to produce – inflation goes up, the Reserve Bank tries to stop people buying things by increasing interest rates and eventually, we all end up living on the grass we’ve been growing in our back gardens. (Stop sniggering at the back).

We’ve been hearing about this for a long time now. But it’s only in the last couple of months that it seems to really be hitting home for the general population. It’s as if a line has been crossed.  Car sales are down 23% year on year. The housing market has stopped completely* in a way that would have the average Daily Mail reader contemplating suicide (oh go on then – if you must).
And then this from the Southern Suburbs biggest shopping mall on a Sunday lunchtime:

Cavendish Square – not square and not full

And yes – all the shops were open. It’s just that no-one has any money to spend in them.

We’ve been told to expect it to get worse before it gets better.
One wonders just how much worse we can manage.

* Although the headline “R110-million for SA’s priciest flat” might make you think otherwise…

17 thoughts on “It’s beginning to hurt

  1. Greetings from up north. So, same news, different hemisphere, eh, apart from the developing economy bit. I can throw in an interfering EU to even things out!

    We’re currently paying £1.18 on average for a litre of unleaded, and over £1.30 per litre of diesel. With the barrel price topping on Friday, I think it won’t be long before we see an increase down at the pumps!! And the famed public transport is rather dire too… not enough of it, and it’s like donating a kidney just to pay for a month’s fares!!

    Good thing it’s summer here now – it will make slipping those grass clippings into the salad that much easier!! 🙂

    Helga Hansen’s last blog post was: The Silent Treatment (Note: 6000 miles… is not responsible for the content of external internet sites)

  2. wow. i wouldn’t mind being there for the massive sale tho.

    SheBee’s last blog post was: Only in my life (Note: 6000 miles… is not responsible for the content of external internet sites)

  3. @My name is Botha (as in Earl): Hmm. Helga is actually South African, MNIB.

    But if I may step in and answer your question, I would imagine that the tax from petrol and a lot of other taxes are spent on actions of the Ministry of Defence and lots of other things.

    It’s not brain surgery.

  4. 6k, what is the current base rate in SA these days?

    MNIB, yes the fuel duty does go to cover the MOD costs as well as schools, hospitals, roads etc. The total take from income tax just about covers the welfare bill.

    Henry Crun’s last blog post was: The Words Every Man Would Love to Hear (Note: 6000 miles… is not responsible for the content of external internet sites)

  5. I was listening to a news report this morning and they were saying that food prices will go down again – in about 5 years!!! Firstly how can they forecast that and secondly what do they expect people to do for the next 5 years. I mean that is not exactly like missing a meal or two.

    In PE house prices are already beginning to drop dramatically as people can’t afford to pay for their bonds. The number of repossessions is huge and I think it is only just beginning.

    Pamela’s last blog post was: Birthdays, steaks and interest rates? (Note: 6000 miles… is not responsible for the content of external internet sites)

  6. Hi My Name Is Botha,

    Actually, to correct 6000, I’m a Norwegian who lived in SA for over 20 years, so yes, it was “home” for quite a while. As for “profit”… erm, no – the profit goes to the oil companies, and those profits generate windfall taxes for the government, who ALSO tax the price of petrol to death! Out of the “£1.18 we’re paying at the pumps these days, 53% goes towards fuel duty, and then we pay another 17.5% VAT as well, which means our government gets over 71p for ever litre of petrol, while the retailer gets the rest, after they have paid the delivery costs.

    And it’s not a war that I support – but the government chooses not to listen to its voters!! So – I support the soldiers who are fighting, but not the government that sent them there! A big chunk of the money goes to supporting the armed forces out there, as well as on health, education and pensions. Personally I think it’s a failing health system, rather top heavy in managers, and lacking in well-paid nurses and doctors! But let’s not go there now! 😀

    Helga Hansen’s last blog post was: The Silent Treatment (Note: 6000 miles… is not responsible for the content of external internet sites)

  7. @Helga Hansen: Oops. Sorry Helga! But I was almost right. Sort of.
    Please show me a country with a decent public health system. I worked in the NHS for 9 years and while it’s not perfect, it’s really not as bad as the Daily Mail would have you believe.

  8. 6k, the NHS isn’t as bad as the Daily Mail would have us believe. It is much much worse.

    I worked at 2Mil, as I have said before, but also at Victoria, Tygerberg and one of the other hospitals in Cape Town (whose name escapes me) and also Baragawanath. If I had treated any of the patients they way the NHS does or left the wards in the state that some of the NHS wards are in, I would have been bounced off the 4 walls. Especially at 2Mil – Captain Shephard was a Tartar of the first order.

    The wards in the the hospitals I mentioned were spotless. Beds were washed down in between admissions and HRI’s were virtually non-existent.

    My daughter went into hospital last year to have her tonsils out. There were dust bunnies under the bed, the bedside cabinet was filthy and there was even old food under the cabinet. It’s disgraceful and purely down to targets/costs that the hospitals are so dirty. And don’t get me started on the way nurses are trained these days – the emphasis on theory and very little in the way of practical patient care. It would appear that the NHS is more of a job creation exercise for useless managers and administrators than it is about nursing and healthcare.

    Henry Crun’s last blog post was: The Words Every Man Would Love to Hear (Note: 6000 miles… is not responsible for the content of external internet sites)

  9. @Henry Crun: I don’t know. I think there’s far more to the NHS than the cleanliness of the wards. However, that’s the public face of the NHS and that’s the one that Paul Dacre likes to concentrate on. As I microbiologist, I could explain the technicalities of the increased HRIs, but suffice to say that there’s a lot more behind it than just a bit of dust under the bed.

    I do agree that the outsourcing of tasks such as cleaning is not a good thing though. It comes down to management of the cleaners. They do a fine job under internal management and then get sloppy when the private company is brought in – but they are the same staff.
    Eventually, the JR in Oxford where I was based, sacked the external company and retook control of the cleaning. Things improved again, despite the fact that none of the cleaners actually changed!

    There’s definitely too much private finance in public healthcare in the UK. And that (their profit margin) is detracting from the money which is available to the system. That is wrong.

  10. 6k, you are quite right on the HRI thing and cleanliness of wards. However, I am appalled that nurses are allowed to commute to and from work in their nurses’ uniform. Personal hygiene, washing of hands etc plays a large part in preventing HRI & cross infection.

    And don’t get me started on GPs. My own GP now takes 2 months off every year to go snowboarding in Canada, another has had a new sports car every other year and only works 4 days per week (9 to 5). Try to get and see a doctor out of hours and see how far you get.

    Agree with the PFI. What a wheeze that is. “We’ll build you a hospital for £100m. You pay us £300m over 25 years” Kerrr-ching. Pop over to and prepare to be horrified.

    Henry Crun’s last blog post was: £3000 Per Day?? Are They Taking The Piss?? (Note: 6000 miles… is not responsible for the content of external internet sites)

  11. Henry took the words out of my mouth, re: the Daily Wail and just how bad the NHS has become. Having lived here for 10 years now, I think I’ve managed to experience both the best bits and the worst bits.

    I live in an area that doesn’t actually have a hospital of sorts (that’s what one gets for going semi-rural), and the nearest hospital to me has some of the best units in the South West. The hospital (Frenchay) is being downsized to a “community” hospital, and another, about 6/7 miles away is being upgraded to a “super” hospital. Great! One small problem – Southmead is slap bang in the middle of a over-crowded community, where there is zero room for expansion, while Frenchay has plenty of land to expand on, and it is far more accessible. But that is the crunch… it has LAND and the NHS trust responsible for the site have decided to sell the land to make themselves a bit of money. Residents all around the hospital and further afield (like my county, who don’t actually have another hospital) have protested, and the trust had a balls to say they didn’t find it necessary to consult on this decision. I am all for cutting waste, and find it frustrating that there are managers managing managers now!

    Deaths from MRSA and C-Diff are at an all time high in this country, and they tackle it how? By introducing a cardboard cut-out nurse who tells you to wash your hands. Great!

    With regards to my personal experience… excellent service from Frenchay at their Pigmentation Lesions Clinic (dealing with skin cancer), which took 6 months from start to finish (methods have changed since 2000, which means faster response times between appraisal and biopsy). Counter that with terrible service from the Orthopaedic Unit at Southmead, regarding two herniated discs. I went to my GP in October 2004 after being almost paralysed from the pain, and I was referred to the unit immediately. I then had to wait until December 2005 for my MRI scan, and I finally had a spinal block in March 2007. During all that time, I had to continually medicate for pain, which can’t have been doing my kidneys any good!

    I think what galls many a patient living here, is that the same NHS trust will whisk you straight to the top of any waiting list if you’re prepared to pay, which is why health care “tourism” has become big business… you’d be surprised just how many of your patients in South African have come over for surgery and a holiday!!

    I could go on, and on, and on, but I won’t. Having lived in SA, and been a member of various medical aid schemes (as well as working for a company which administered over 50 schemes), I know which one I would rather have. At least you KNOW what your money is buying, and you’re not being brainwashed into thinking it’s “free”, because it bloody well isn’t!!

    (Climbs off soap box, and kicks it back under the bed) 🙂

    Helga Hansen’s last blog post was: We’re All Going Doon! (Note: 6000 miles… is not responsible for the content of external internet sites)

  12. @Helga Hansen: Wow.

    One point – handwashing is probably the best and mst simple way to reduce MRSA and C.diff infections in hospitals. Good for Staff Nurse Cardboard!

  13. Sorry… want me to pay rent for hijacking your blog-space? 😉 And you’re right, Staff Nurse Cardie is a good idea… coming soon, to a ward near you!

    Helga Hansen’s last blog post was: We’re All Going Doon! (Note: 6000 miles… is not responsible for the content of external internet sites)

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