Cape Town:The South African government has announced the identification of R38.1 billion in savings over the medium term, as part of its strategy to improve spending quality and allocate funds towards efficient and effective programs.
According to South African Government News Agency, Finance Minister Enoch Godongwana explained that the government is moving away from incremental, input-driven budgeting towards strategic decisions focusing on outcomes, affordability, and value for money. This includes phasing out programs that are no longer deemed necessary and restructuring underperforming and inefficient ones.
The identified savings over the 2027 Medium-Term Expenditure Framework (MTEF) period include R11.7 billion from low-priority programs, R13 billion from reducing fraud in social grants, R7.8 billion from inefficiencies in the human settlements development grant, and R5.5 billion from public entity surpluses. Additionally, Finance Minister Godongwana noted potential efficiencies in provincial budgets, such as more effective remuneration policies for healthcare workers.
The National Treasury emphasized the importance of improving spending quality by focusing on program efficiency and effectiveness. The reforms aim to reduce leakage and fraud, redesign failing programs, and redirect funds from low-priority activities.
In the 2026 Adjustments Appropriation Bill, an upward adjustment of R10.6 billion is proposed, which includes rollovers from the previous financial year and funding for disaster relief. A Special Appropriation Bill for 2026/27 is also proposed, allocating R6.9 billion primarily to the South African Revenue Service. Furthermore, R150 million is allocated to develop the MyMzansi app, and R20 billion is earmarked for infrastructure projects under evaluation.
Minister Godongwana announced that additional revenue in 2026/27 allows for a R45.5 billion increase in government expenditure, with allocations for disaster relief, troop deployments for crime fighting, and commissions of inquiry included in the Adjustments Appropriation Bill.
