Government leaders have gathered at an extended Cabinet meeting to assess plans and priorities for the year ahead, placing an emphasis on fiscal discipline, economic stability and targeted funding to support government’s key priorities.
This is according to the Minister in the Presidency, Khumbudzo Ntshavheni, who addressed members of the media on the sidelines of a Cabinet Lekgotla that has been convened by President Cyril Ramaphosa with leaders in all spheres of government.
The meeting noted that when the 2025 Budget process began, South Africa’s borrowing costs were above 13%. This has since declined to approximately 9%, demonstrating the positive impact of fiscal prudence and sound financial governance.
Furthermore, South Africa’s Gross Domestic Product (GDP) increased by 0.5% in the third quarter of 2025, following an increase of 0.9% in the second quarter of 2025.
“The cost of borrowing for the government of South Africa has reduced drastically… showing that our fiscal prudence and fiscal management is strengthening. The performance of the rand has stabilised. We have considered these factors to determine the fiscal envelope that will guide our priorities and funding decisions. These are the issues currently under discussion,” Ntshavheni said.
The work of the seventh administration is guided by the Medium-Term Development Plan (MTDP) 2024-2029, in pursuit of three key priorities: driving inclusive economic growth and job creation; reducing poverty and tackling the high cost of living; and building a capable, ethical, and developmental state.
The MTDP provides a whole-of-government framework which aligns planning, budgeting, implementation, monitoring and evaluation across all spheres of government.
“We will also be engaging on the country’s industrial policy, focusing on how, as part of our inclusive growth and development plan, we can define an industrial policy that anchors and drives this growth agenda.
“We presented the implementation plan for inclusive economic growth and development in the country. We will now finalise the revised timelines for its implementation. We will also focus on how to drive skills development across the country.
“Any economy that seeks to grow must be anchored in a strong national skills base. We are therefore reviewing how to realign our approach, and we will receive a joint presentation from the Departments of Labour and Higher Education on how existing funding mechanisms and platforms for skills development can be better utilised and streamlined.
“This will ensure they are more effective in driving skills development and creating employment opportunities, particularly for young people,” the Minister said.
She emphasised that economic growth cannot be achieved in an environment undermined by crime and criminal activity.
“To address this, we will receive a presentation tomorrow from the Justice and Security Cluster outlining a strategy to combat organised crime and deal decisively with these challenges,” the Minister said.
The recent announcement by British American Tobacco South Africa (BATSA) that it will close its Heidelberg manufacturing plant by the end of 2026 due to the illicit trade market, has also been placed on the agenda for discussion.
“We will also have a conversation about the future of the country in addressing the gender-based violence pandemic and how we mobilise society to respond to the scourge,” Ntshavheni said.
The Cabinet Lekgotla comes ahead of the State of the Nation Address (SONA), which will be delivered by the President on 12 February 2026 and will be followed by the Budget Speech by the Minister of Finance on 25 February 2026.
The President will outline government's strategic priorities for the year, while the Budget Speech allocates financial resources to implement these plans. - SAnews.gov.za
