Monday, March 8, 2010

Middle Class Takes The Pain

For those who fall into the middle class bracket, I can’t imagine that yesterdays Sunday Times front page storey “Cash Crunch Nails Middle Class” came as a revelation. The piece simply articulated what most are experiencing first hand, and are desperately trying to navigate a way through.

The strap-line beneath it read “Middle class can't cope with high bills and Punitive Taxes” and what they are saying is, Millions of debt-ridden wage earners across the country - including those fortunate enough to have got a salary increase in the past year - are in financial dire straits.

It really is a doom and gloom article which notifies us that the number of people seeking counseling from debt related depression, has increased dramatically.

Although experts are saying that we are seeing signs of an economic recovery, the Times reports that consumers from Paarl to Polokwane (as they put it) are still struggling to put food on the table once the taxman has taken his crippling cut. The key numbers they provide to illustrate the scale is as follows:
  • A 25% increase next month in the price of electricity, which will double by 2012;
  • Rising petrol prices - from R4.41 a litre two years ago to R7.91 now;
  • School fees, up this year by between 8% and 15%; and
  • Medical aid contributions, up by about 11% this year after a 12% hike last year.
As a result:
  • Nearly three million consumers are over three months in arrears on their bills; and
  • An estimated 250000 middle-income earners have lost their jobs in the past two years.
For persons who may have missed it yesterday and are interested reading the full Sunday Times spread click here and visit our Forum to post your comments.

Ernest Roper

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