Wastage and duplication
Mayibongwe Maqhina|Published
Finance Minister Enoch Godongwana said the National Treasury has identified R38.1 billion in savings through the identification of wastage and duplication in government programmes.
Addressing Parliament when presenting the Medium -Term Budget Policy Statement (MTBPS), Godongwana said targeted and responsible savings were yielding results as government improved the quality of spending and reduced funding pressures.
"We are phasing out programmes that are no longer fit for purpose. We are also restructuring underperforming and inefficient programmes, and reducing administrative inefficiencies and fraud in programmes," he said.
Godongwana introduced the Targeted and Responsible Savings (TARS) initiative in the 2025 Medium-Term Budget Policy Budget Statement, saying the initiative had forced departments to engage with efficiency and effectiveness of programmes when seeking funds for different priorities.
He told the MPs R12 billion in savings was identified in the 2026 budget.
"A further R38.1 billion has been identified over the 2027 Medium Term Expenditure Framework period," said the minister.
The MTBPS showed that the savings came from low-priority programmes, fraud reduction in social grants, halting of the human settlements development grant, surpluses in public entities.
"To date, work in four focus areas has realised R38.1 billion in savings over the medium term."
According to the MTBPS, the enhanced biometric enrolment and beneficiary verification have resulted in savings of R13.1 billion in the social grants system over the medium term.
"Similar data-driven approaches are being used to improve targeting of National Student Financial Aid Scheme bursaries and the housing subsidy system," reads the document.
It also said the Human Settlements Development Grant was being redesigned to address issues of poor planning and implementation.
The White Paper for Human Settlements offers an opportunity to reset housing delivery so that it provides access to shelter and facilitates access to jobs and business opportunities.
"By pausing the grant, R7.8 billion has been identified for reprioritisation over the medium term while a more responsive model is designed."
The National Treasury further said the government obtained R11.7 billion in savings from national departments by focusing on priorities and boosting efficiency over the medium term.
"These include savings from modernising technology, reducing administration expenses and reducing duplication in rural development programmes."
The MTBPS said the government has looked at the surpluses that accumulated in some public entities.
"In 2027/28, R5.5 billion will be recovered and deposited into the National Revenue Fund while a consistent legislative approach is developed, taking the specific arrangements of various institutions into account," said the document.
Godongwana said efficiencies and savings can also be found in provincial budgets.
"The implementation of more effective remuneration policies for healthcare workers could be used to employ more health professionals," he said.
The National Treasury said improving spending efficiency is a central priority, supported by budget reforms, programme reviews and efficiency measures.
"The government will continue to reduce leakage and fraud by improving administration and verification, redesigning programmes that fail to meet their objectives, redirecting funds from low priority, inefficient or duplicated activities and addressing accumulated cash surpluses in public entities."
Meanwhile, the National Treasury said the findings of government’s ghost worker investigations were being consolidated and will be published in the 2027 Budget.
Godongwana had announced in his 2025 Budget that the National Treasury and the Department of Public Service and Administration had instituted an audit process to identify “ghost workers” and payment irregularities across all national and provincial departments.
He said the audit has successfully flagged 4 323 high-risk, suspicious cases in the payroll system.
The MTBPS said an online verification platform was developed in partnership with the Home Affairs Department to deal with officials whose details could not be verified against the National Population Register and other high-risk officials as a way to complement the physical verifications completed by the Department of Public Service and Administration.
"The National Treasury is consolidating the findings from all government ghost worker initiatives (including those by the Department of Basic Education and the Department of Public Service and Administration) and will provide the results by the 2027 Budget.
"The National Treasury is also working with the Financial Intelligence Centre to investigate high-risk officials. Findings will be reported in the 2027 Budget."