Godongwana cuts 2026 growth forecast to 1.2% in mid-term budget
Finance Minister Enoch Godongwana told Parliament on Wednesday that debt stabilised at 78.4% of GDP in 2025/26 and the budget deficit this year is 4.3% of GDP. He said government's fiscal commitments are starting to pay off.
Godongwana lowered the growth forecast from the 1.6% projected in February. He expects growth of 1.6% in 2027 and 2% by 2029. He said growth could exceed 3% a year if government stays the course, but warned that the Middle East conflict and El Niño could weaken it.
The deficit was forecast at 4.5% at the time of the Budget and should fall to 2.5% of GDP by 2030. The primary surplus is 1.7% of GDP this year. Godongwana also released draft fiscal anchor legislation for public comment.
Government identified R38.1 billion in medium-term savings, on top of R12 billion in the 2026 Budget. They include R13 billion from reducing social grant fraud. Extra revenue lets government spend R45.5 billion more than announced in February.
Godongwana announced R810 million to renew the police vehicle fleet next year. He also announced R2.2 billion over the medium term to strengthen the independence of the judiciary. The Adjustments Appropriation Bill proposes R10.6 billion more for 2026/27 expenditure.
Key facts
- Who
- Enoch Godongwana (Finance Minister); National Treasury (government department that issued the MTBPS document); South African Police Service (police service whose vehicle fleet will be recapitalised); Border Management Authority (agency receiving allocations this year)
- What
- Government identified R38.1 billion in medium-term savings, in addition to R12 billion identified in the 2026 Budget, from low-priority programmes, social grant fraud, the human settlements development grant and public entity surpluses. The Adjustments Appropriation Bill proposes an upward adjustment of R10.6 billion to 2026/27 expenditure.
- When
- 21 October 2026
- Where
- South Africa, Parliament
- Status
- Reported