Nicola Mawson|Published
Finance Minister Enoch Godongwana’s R10 billion fuel levy relief has been welcomed, but the Organisation Undoing Tax Abuse (OUTA) warned that South Africans continue to pay for government waste, failing infrastructure and poor financial management.
The organisation said Wednesday’s Medium-Term Budget Policy Statement (MTBPS) offers some respite for households battling higher transport and food costs, but questions whether additional government spending will translate into better services.
“South Africans are feeling the pressure every time they fill their tanks, buy groceries or pay for transport. This relief will help, but only temporarily,” said OUTA CEO Wayne Duvenage.
Godongwana announced temporary fuel levy reductions of R1.50 a litre for petrol and R3 for diesel from 4 November until 1 December, followed by smaller reductions until 5 January 2027.
However, OUTA argued that the bigger issue is whether taxpayers receive value for the money government already collects. The organisation pointed to Treasury’s review of R887 billion transferred to provinces and municipalities through infrastructure conditional grants between 2017/18 and 2023/24.
Endless delays
According to OUTA, the review found that projects were frequently delayed, incomplete or failed to deliver their intended benefits. OUTA stressed that this does not mean the entire R887 billion was wasted, but says the findings raise serious accountability questions.
“Spending the money is not the same as doing the job. Treasury must tell South Africans which projects failed, how much was spent, who was responsible and what action has been taken,” Duvenage said.
The MTBPS provides an additional R21.8 billion to the local government equitable share over the medium term to help cover rising costs of basic municipal services.
But OUTA said many municipalities spend too much on operating costs and too little on maintaining infrastructure.
“When municipalities collect money for electricity and water but fail to maintain those networks, residents pay twice. First through their municipal bills and then through the cost and disruption of failing infrastructure,” Duvenage said.
Beyond the pumps
The property industry has also welcomed the temporary fuel relief while calling for broader measures to improve household affordability.
Dr Andrew Golding, chief executive of the Pam Golding Property Group, said the intervention will help cushion consumers and businesses against rising transport and operating costs.
“Higher fuel costs have implications well beyond motorists, influencing transport, distribution, food prices and inflation more broadly,” Golding said. “While the relief is temporary, it offers some breathing space for households and businesses facing mounting costs.”
However, Golding said sustained improvements in housing affordability will require stronger economic growth, employment and access to competitive home financing.
Samuel Seeff, chairman of the Seeff Property Group, described the MTBPS as “a stable and fair fiscal plan under challenging macroeconomic conditions,” while calling for rate cuts to relieve strained consumers and support housing demand.
Economist’s view
Momentum Group economist Sanisha Packirisamy cautioned that temporary fuel relief cannot shield consumers indefinitely from elevated international oil prices.
Packirisamy noted that Treasury has lowered its economic growth forecast for 2026 to 1.2%, from February’s 1.6%, while revising this year’s non-interest spending envelope higher by R45 billion.
The additional expenditure is intended to support health, education, local government and regulatory enforcement, Packirisamy said, but stresses that stronger growth and consistent infrastructure delivery are necessary for lasting improvement.
OUTA also wants scrutiny of Treasury’s planned R38.1 billion in medium-term savings, including measures targeting social grant fraud and ineffective programmes. It cautioned that efforts to eliminate waste must not penalise legitimate grant beneficiaries or undermine essential services.
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