While many South Africans say they’re already struggling to make ends meet, Finance Minister Enoch Godongwana has been adamant that Government needs more money, to amongst others, service its R1.2 billion per day national debt.
This follows the Minister’s tabling of the 2025 National Budget in Parliament earlier today (Wednesday- May 21).
Total budget
The total budget for non-interest spending stands at a staggering R6.69 trillion.
Changes
The general fuel levy will rise by 16 cents per litre for petrol and 15 cents per litre for diesel from June 4. This is the first fuel tax increase in three years, but it comes at a time when many are already cutting back on basics to make their budgets stretch. Meanwhile, the country is spending more than R1.2 billion per day just to service its national debt — more than what’s being spent on public healthcare, police, or schools.
Following public backlash, the proposed VAT increase has been scrapped — for now. The Minister confirmed that VAT will remain at 15%. However, new tax measures to raise R20 billion are likely to come in the 2026 budget if SARS doesn’t collect more revenue in the coming year. It was also announced that the list of zero-rated VAT items will no longer be expanded.
A new joint committee between Treasury and the Presidency is being set up to identify and cut wasteful or underperforming government programmes. A review of over R300 billion in state spending since 2013 has already revealed that around R37.5 billion could be saved by improving oversight and cutting duplication. Treasury is also planning to roll out tools to find “ghost workers” on the payroll.
The Minister quoted a heartbreaking letter from a young medical student who described the daily trauma of working in a public hospital with no gloves, no alcohol swabs, and being forced to decide who gets the last bed in high care. The budget allocates an additional R20.8 billion over three years to the health sector to hire 800 more doctors and reduce unpaid bills — but the crisis runs deep.
An extra R9.5 billion will be added to the education budget to retain teachers and hire more staff. The early childhood development (ECD) subsidy rises from R17 to R24 per child per day, aiming to reach 700,000 more children. The old age grant increases to R2,320 by October. The R350 COVID-19 relief grant is extended to March 2026, with government exploring a possible job-seeker allowance as a longer-term plan.
Over R1 trillion will be spent on infrastructure in the next three years — including roads, rail, water, and energy. Key allocations include R93 billion for national road maintenance via SANRAL, R66.3 billion to PRASA for new trains and signal upgrades, R219 billion to strengthen the electricity grid, and R156 billion to improve dams and water infrastructure. A new infrastructure bond will be launched this year, and public-private partnerships (PPPs) are being reformed to allow private investors to help fund projects faster.
Municipalities will receive R552.7 billion over three years. But Treasury warned that poor service delivery could cost local governments their funding. A total of R610 per household per month is earmarked to provide free basic water, electricity and sanitation for 11.2 million poor households.
R1.4 billion has been allocated for the upcoming 2026 local elections — including security and logistics. South Africa will also withdraw troops from the DRC, with R3 billion set aside for this process.
The Minister concluded by saying that this is not an “austerity” budget and admitted that the next round of cuts is coming in 2026, especially for underperforming programmes.
While the budget tries to balance social support with financial discipline, the big question remains… Will the money reach the people?
-Reader