Savings in mineral and energy budget – the poor are actually paying the price for lockdown

2020-07-21
Dr. Wynand Boshoff

(Debate in parliament: Adjustment Budget for Department of Mineral Resources and Energy)

The economic crisis, which has been exacerbated by the national period of lockdown, is forcing the Department of Mineral Resources and Energy to cut back on its budget with more than 15% (R1,5 billion).

The country's poorest will have to pay the price for this, which will only add to social and political tension.

This Department, which is actually responsible for the policy and regulation of the mining and energy sectors, spends more than half of its budget (approximately R5 billion) on projects that it does not want to delegate to the market – because they benefit people who must be saved from the poverty cycle.

The focus is mainly on the electrification of rural housing units and the optimisation of municipalities' energy efficiency with the aim of saving on service delivery.

It is from this part of the budget that the Department must cut R1,5 billion. It means that approximately 43 000 households will have to wait longer to get electricity. And there is no guarantee that the economy will recover and that things will get better again.

In addition, mining has failed to reach the levels it had maintained in 2007 and the country is burdened with load shedding. The Department formulates its aim as regulating minerals for transformation, growth and development and to utilise mineral resources through policy and regulation in the energy sector to give everyone access to affordable and reliable power.

This means that the Department of Mineral Resources and Energy cannot achieve the goal it formulated for itself. Families and communities are forced to take the responsibility of energy provision on themselves.

This is a realistic prospect seeing as the model of large-scale, centralised power generation in ecologically damaging power stations is all the more being replaced by the notion of decentralised smart networks.

While the Department's regulatory and policy-making role is vital, the onus rests on the Department to remain relevant and up to date with the latest developments.


Contact details: 074 166 5540

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