NO Budget cuts, only increases, says Finance Minister Enoch Godongwana during his Medium-Term Budget address in Cape Town today, an ‘austerity budget’ some believe.
This is due to R80bn surplus from Sars, and of major concern is bringing debt down stabilising at 78, 4% of GDP in 2025/26.
Revenue collection in 2026/27 stronger than expected due to higher Sars collection.
Good news for South Africans is fuel price relief reduction (Petrol- R150 a litre and Diesel R3 a litre) from November 4 to December 1, 2026, following R10bn relief from Central Energy Fund.
R823m for the South African Defence Force to fight gangs, illegal mining, etc.
R186m for GBV and Investigative capacity.
The R516m was allocated for Madlanga, Khampepe and Nkabinde Commissions, respectively.
R2,2bn for Judiciary.
With Local Elections next month- provinces were given added budget, including health and education.
But Deputy Minister of Finance, David Masondo, warned if municipalities do not use the allocated budget, they will implement Section 219 to withhold funds like they did with other municipalities recently.
Slow economic growth and high unemployment now standing at 1,8m higher than before Covid 19, a major concern especially for youth not partaking in the economy of the country and reskilling themselves.
Minister Godongwana allocated R150m for digital expansion as part of youth re-emergence.
MKP’s Des Van Rooyen says the budget is insensitive and has no plan to grow the economy, it’s all about policy rhetoric’s, he said.
However, his counterpart and BUILD ONE SA President Musi Maimane believes this was a good start, as it would it “attract investors, capacitate police and with that buffer we can do more”.
Sars Commissioner, Johnstone Makhubo remarked ‘we can’t always rely on mining, we must challenge other sectors to come to the party to help sustain country’s debts’, he said, with inflation estimated at 4.4% after oil price shock.
Gross tax revenue revised upwards by R17bn.
Gross tax revenue projected to increase from R2,14 trillion.
Outspoken Matthew Parks from Cosatu, said would have expected the Minister to touch on expanding EPWPs and help the likes of Eskom and other sectors, not to bail them out but offer support.
