SA Canegrowers has written to the chairperson of Parliament’s Standing Committee on Finance requesting oversight into National Treasury’s policy making regarding the Health Promotion Levy. This follows the failure of National Treasury to respond to a request under the Promotion of Access to Information Act to provide the reasoning behind the ongoing implementation and the planned increase of the levy.

This request has also been made ahead of Minister Godongwana delivering his 2023 Budget Speech this week. Amongst other things, the Minister is expected to announce whether the increase in the Health Promotion Levy will take effect on 1 April 2023, as previously announced.

The sugar industry has struggled for close to five years under the yoke of an unsubstantiated ‘health’ intervention with no evidence whatsoever of its effectiveness. However, there is ample evidence regarding how the continued implementation of the levy threatens the future sustainability of the industry and the one million livelihoods it supports.

Last week, the South African Sugar Association released the findings of modelling it commissioned which shows that the planned increase in the Health Promotion Levy will cost the sugar industry more than 6,000 jobs and jeopardise the businesses of nearly 3,000 small-scale growers. This adds to the total of more than 16,000 jobs and R2 billion lost because of the levy in the first year of its implementation alone.

This information comes on the heels of the data compiled by SA Canegrowers which showed that growers are expected to lose more than R700 million in 2023 due to the implementation of loadshedding at stages 4-6. This could rise to R1,8 billion if loadshedding escalates to stages 6-8.

As the sugar industry, like much of the national economy, suffers the effects of crippling loadshedding, high inflation, and deteriorating infrastructure exacerbated by recurring floods, with the additional hardship occasioned by a crisis in the milling industry, maintaining the Health Promotion Levy is not sustainable. Increasing it would be unconscionable.

Our Constitutional framework envisions transparent and accountable governance, and  Parliament’s committees play a critical role in this regard. The failure of National Treasury to comply with legislation, and to deal transparently with the sugar industry, is disappointing and requires the intervention of the Standing Committee on Finance.

SA Canegrowers continues to urge Minister Godongwana to help us save vital livelihoods in South Africa’s rural economies by scrapping the sugar tax, and to work with the industry and other social partners to devise less destructive ways to promote health in South African than the job-killing Health Promotion Levy.