Deputy Finance Minister, Dr David Masondo, says the 2026 Budget is redistributive while balancing the need for fiscal discipline.
The Deputy Minister participated in the post-Budget speech breakfast discussion hosted by the National Treasury, in partnership with Brand South Africa and the Government Communication and Information System (GCIS).
National Treasury has hinged the economic growth strategy on four pillars: maintaining macroeconomic stability, implementing structural reforms, investing in growth-enhancing infrastructure, and building state capacity.
These, Masondo said, are aimed at improving the lives of ordinary South Africans in the long run.
“All these things are significantly linked to the interests of the poor. At the end of the day, it’s what impact will this have on the ordinary person in terms of jobs. Without economic growth you can’t have the tax revenue that enables us to do the things that we have to do like education and health.
“This is a redistributive budget in terms of expenditure as 60% of the budget goes to the poor. Those who say we are austere they must look at the facts,” Masondo said.
The Deputy Minister said this year’s budget presents a different case which includes a withdrawal of some R20 billion in tax increases while carefully managing the public purse.
“What is different about this year’s budget is that we have withdrawn the tax increase. It also has to do with the fact that we have been responsible in managing our fiscal policy and that has implications on the cost of capital.
“Investors look at your sovereign risk premium to determine the cost of capital. So they look at how we are managing our deficit, primary budget surplus, economic growth and so forth.
“That matters because with the debt service costs going down…the debt service costs are going to reduce by R10 billion and what that does is that it opens up space for us to spend money on the needs of the poor, for entrepreneurs…capital becomes cheaper. That has huge implications for our ability to raise money for creating jobs and so forth,” he said. – SAnews.gov.za
