Economic Growth
Sizwe Dlamini|Published
SOUTH Africa’s public finances are stabilising, but the benefits have yet to reach households and young job seekers, according to financial and industry experts reacting to this year’s Mid-term Budget Policy Statement (MTBPS).
Wealth Manager at Consult by Momentum Jurgen Eckmann says the government’s books are healing faster than most households’ budgets. He noted that the Minister confirmed “debt has stabilised at 78.4% of GDP and is now falling, and the deficit is a little better than February's forecast.”
However, Eckmann cautioned: “That is good news for the long run. But it doesn’t put money back in your pocket this month, with inland petrol above R30 a litre and prime at 10.75%.”
Regarding the fuel levy cut of R1.50 a litre from 4 November, Eckmann advised: “The fuel relief is welcome, but keep it in perspective.” He cautioned that early forecasts point to another increase in November, so the cut may only soften it rather than lower the price at the pump, adding: “Don’t plan your budget around it.”
Addressing the broader economy, Eckmann highlighted that growth was cut to 1.2%. “In a slow economy, your job is your biggest financial asset,” he said, urging citizens to “build an emergency fund of three to six months of expenses, where possible, and keep your two-pot savings for genuine financial emergencies.”
On the fiscal outlook, Eckmann noted: “Treasury now expects tax revenue this year to be R17.1 billion higher than it forecast in February,” but added this is “below the R40 billion to R50 billion some economists had anticipated, and much of it comes from commodity prices that won’t last. I wouldn’t count on tax relief in February.”
Regarding crypto, he noted that while Treasury aims to “move away from pre-approvals for cross-border crypto transactions”, it is “still a draft, so nothing changes yet”.
For the youth, Youth Employment & Entrepreneurship Specialist at the Momentum Group Foundation, Nkosinathi Mahlangu, said the fiscal outlook presents a mixed picture. “The Minister’s confirmation that South Africa's public finances are stabilising is encouraging, particularly the continued commitment to infrastructure investment.”
However, Mahlangu pointed out: “With economic growth revised down to just 1.2% for 2026, the question remains how we translate this progress into meaningful employment opportunities for young South Africans.”
He cautioned: “We cannot ignore the impact of high fuel and energy costs and unreliable water supply on economic growth,” noting, “these pressures make it harder to attract new investment and for existing businesses, particularly SMEs, to remain viable and create jobs.”
While infrastructure projects supported by IFISA hold a potential investment value of over R200 billion, Mahlangu stressed: “Infrastructure spending does not automatically translate into youth employment.”
He further said: “We need deliberate mechanisms to connect young people to these projects through apprenticeships, technical training, local procurement and entry-level employment opportunities.”
He added: “These infrastructure ambitions have featured prominently in previous Budget speeches, yet we are still not seeing sufficient reporting on what has actually been delivered, how much progress has been made against earlier commitments, and importantly, how many jobs have been created as a result.”
Mahlangu was particularly encouraged by the Minister’s acknowledgement that spending does not always translate into results, citing a review of R887 billion transferred to provinces and municipalities where projects were often “delayed, incomplete or failed to deliver their intended benefits”.
He insisted: “We need to measure not only how much government spends but how many young people actually gain skills, secure employment or build sustainable businesses as a result,” and urged that government procurement policies “make deliberate provision for youth-owned businesses.”
Mahlangu said: “The Statement offers little in the way of specific youth employment targets or dedicated interventions," warning that without clear accountability, "young South Africans risk being left behind.”
In the energy sector, the chief executive of SolarAfrica, David McDonald, said the focus remains on private investment and execution. “From an energy perspective, this year’s MTBPS is largely a continuation of existing policy, although it’s encouraging to see some tangible progress on commitments made earlier in the year.”
McDonald highlighted the Credit Guarantee Vehicle, stating: “The most significant development is the Credit Guarantee Vehicle, which has now been incorporated and received conditional capital commitments of US$553 million.”
He called this "a positive step towards unlocking private investment in infrastructure, particularly transmission, which remains one of the biggest constraints on South Africa's energy market.”
“We urgently need more grid connections to accommodate private generation and bring more competitively priced electricity into the market,” McDonald said.
He emphasised: “Affordable electricity is essential for economic growth, allowing energy-intensive industries such as smelters to resume operations and giving manufacturers the confidence to expand rather than scale back because of prohibitive energy costs.”
While the Minister reiterated commitments to restructuring Eskom and establishing an independent transmission operator, McDonald noted: “Both are critical to creating a competitive electricity market,” but “we still need greater clarity on implementation timelines.”
He also welcomed the additional R3.5 billion for municipal smart metering, explaining that “improving revenue collection is critical because when municipalities and Eskom cannot recover the cost of electricity supplied, the financial burden ultimately falls on paying customers”.
Summarising the outlook, McDonald concluded: “Overall, the direction remains positive, but implementation is what matters now. Expanding the grid, improving revenue collection and introducing meaningful market competition are what will ultimately determine whether South African businesses can access electricity at prices that allow them to grow.”