The Competition Commission’s March 2026 Cost of Living Report shows SA’s cost-of-living crisis has not eased with falling inflation.
While headline inflation averaged 3.2% in 2025 and measured 3.6% year on year in December, essential goods and services are persistently expensive and continue to place disproportionate pressure on low-income households.
The report shows electricity prices have increased by about 85% cumulatively since 2020, while water prices have risen about 68% over the same period, compared with headline inflation of just more than 30%.
Recent tariff decisions confirm continued increases, including an 8.76% rise in 2026 and a further 8.83% increase already approved for 2027.
The report builds directly on the commission’s inaugural August 2025 study, which established that the core of the crisis lies not in general inflation but in the sustained escalation of essential costs such as electricity, water, food and education.
That earlier report showed electricity prices increased by 68% and water tariffs by 50% over the five-year period from 2020 to 2025, compared with overall inflation of about 28%.
Essential goods expensive
The 2026 findings confirm this pattern has not reversed. Headline inflation moderated to 3.6% year on year by December 2025, but this did not translate into lower living costs for households because the prices of essential goods stay elevated and do not adjust downward once increased.
This reinforces the conclusion that inflation in SA is uneven and regressive, with lower-income households most exposed because a significant share of their income is spent on essential goods and services.
Utilities remain the most significant driver of pressure.
Administered prices set by municipalities and state entities continue to shape household costs.
The report states electricity tariffs are expected to increase by about 18% over the next two years due to cost recovery requirements.
Food markets show a similar pattern. The 2025 report identified pricing behaviour where retail prices increase quickly when input costs rise and adjust slowly when costs fall.
The 2026 report shows this persists. Producer prices for eggs declined from R13.32 to R11.69 between June and November 2025, while retail prices decreased marginally from R23.84 to R23.02 over the same period.
For IQF chicken, producer prices remained around R45, while retail prices increased from R96.38 to R101.56 between June and December 2025.
Transport and interest rate pressures have moderated but remain secondary. Petrol price inflation stabilised in the low- to mid-30% cumulative range, and taxi fares moved closer to headline inflation.
Bond repayment inflation moderated to just more than 20% cumulatively by January 2026 after changes in monetary policy.
Social services continue to rise above inflation. Public primary education costs increased by 37% and secondary education costs by 42% since 2020.
The report indicates that school fees are expected to increase by about 10% in 2026 due to rising operational costs and funding gaps. Healthcare costs continue to be elevated, with 84% of the population uninsured. - Business Day
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