Treasury identifies over R300 bln in wasteful programmes

National Treasury and provincial treasuries have identified over R312-billion in wasteful spending on non-performing programmes since 2013.

Government spending is estimated to reach nearly R2.6 trillion in the 2025-26 financial year with social services accounting for more than half of spending.

Government says a cut in spending on non-performing programmes will override the need for higher taxes going forward.

Deputy Finance Minister David Masondo, “As National Treasury we’ve been undertaking spending reviews from 2 000, the key issue is how those spending reviews are treated by accounting officers. There’s so much we can do from our side but departments are responsible for cutting fat and waste in the way in which they spend public funds and the President working with National Treasury will also be working hard to make sure that we cut waste.”

Lower growth

Meanwhile, Treasury has also lowered its growth forecast from 1,9 percent to 1,4 percent this year.

It attributes its downward revision to domestic economic weaknesses, including logistical constraints and high borrowing costs, further exacerbated by global headwinds due to geopolitical tensions.

Finance Minister Enoch Godongwana says this Budget aims to stimulate growth through a trillion rand of investment into infrastructure over the next three years.

“As a result, we now estimate real GDP to grow at 1.4 percent in 2025. This is lower than the 1.9 percent we projected in March. Over the next two years, we project real GDP growth to rise moderately to 1.6 percent in 2026 and 1.8 percent in 2027. Looking further ahead, the risks to the outlook remain elevated. These include the worsening global outlook, weaker-than-expected growth in the fourth quarter of 2024, the persistence of logistics constraints and higher borrowing costs.”