Govt talks tough on food prices

Midrand - The government will be unrelenting in dealing with suppliers who colluded on food prices, deputy president Kgalema Motlanthe said on Tuesday.

"It is unacceptable that food prices should be artificially inflated through the collusive scheming among the major suppliers, resulting in more misery for the poor," Motlanthe said at the Congress of SA Trade Union's 10th national congress at Gallagher Estate in Midrand.

"The state will be and is unrelenting in dealing with these sorts of crimes," he told delegates.

The competition commission was already prosecuting those allegedly involved in colluding in the bread industry.

Collusion in the maize or milling sector was being referred to the Competition Tribunal for prosecution.

The case against the dairy industry was already before the tribunal with one case before the tribunal on the poultry sector and a wider investigation underway.

An investigation was beginning into the supermarket sector, with the fats and oils sector also being probed, Motlanthe said.

A settlement had been reached with Sasol on fertiliser, and others were being prosecuted, he said.

Motlanthe told the congress it was meeting during a "deep global recession", which exacerbated the difficulties already facing the country.

He said that while the country's financial sector remained relatively strong in the face of the global meltdown, employment had dipped by 2% in the second quarter of the year.

Government revenue had declined and the budget deficit was set to rise from one percent of the gross domestic product to about eight percent of GDP in this fiscal year.

"Our only achilles heel being the massive negative balance of trade and payment," he said.

"We also need to bear in mind that we were using capital inflows to finance our investments and that needs to change." He spelled out the country's framework response to the crisis. Motlanthe, quoting Oliver Tambo, called for unity among South Africans.

"The unity of our people remains our strategic goal. "Even as we respond to the ravages of the impact of recession we must never lose sight of this important goal," he said.

- Sapa