South Africa's 2026 Budget Speech: A hope for economic recovery?
With South Africa's Minister of Finance set to deliver the 2026 Budget Speech, citizens are eager for signs of fiscal relief amid rising costs and a growing credit crisis.
Image: File/ Independent Newspapers
The nation will be watching with a close eye and listening for some hope of fiscal reprieve later this week when South Africa's Minister of Finance, Enoch Godongwana, will deliver the 2026 Budget Speech.
While the country enjoyed a fuel price decrease at the start of the year, along with interest rates remaining unchanged and a hopefull State of the Nation Address (Sona) delivered by President Cyril Ramaphosa, with hopes of a charge on economic recovery for the year, consumers are still feeling the pinch, and looking for ways to stretch their rands further every month.
Data released on Monday showed that in February 2026, the average cost of the Household Food Basket was R5 383,81.
Between January 2026 and February 2026 the average cost of the Household Food Basket decreased by R17,63 (-0,3%).
Year-on-year, the average cost of the Household Food Basket increased by R70,59 (1,3%).
The Household Food Basket showed that on average; food prices have come down marginally over the past month, and a little up from a year ago.
For many citizens, the relief remains elusive as everyday expenses continue to stretch household budgets to the breaking point.
Consumer credit crisis
That is one of the many factors that play a part in consumers monthly budgets and according to Debt Rescue CEO, Neil Roets, credit-active citizens are in deep trouble.
According to Eighty20’s latest credit report, South Africans total loan balance increased by 0.8% quarter-on-quarter, reaching R2.6 trillion in the third quarter of 2025. The credit active population continued to grow during the third quarter of 2025, increasing by 3.94% year-on-year. Total overdue balances also increased, up 9% year-on-year to R212 billion.
The debt load of R2.6 trillion works out to roughly R43,000 for every man, woman, and child.
The 4.1 million middle-income earners with families, mortgages and frequent shopping routines held 12.9 million loans in this quarter, while the employed lower-middle-income group, mostly women with store accounts and sometimes credit cards, now number 8.6 million people. This group took out more than 2.1 million new loans in the quarter, most of them retail and personal loans.
“This tells a story of a nation in deep financial waters and relying on credit to keep going. More concerning is that this red flag doesn’t seem to be registering among the authorities who make the decisions that impact the welfare of ordinary citizens,” Roets told Business Report.
"Food and utility costs continue to climb, outpacing wage growth and rendering everyday necessities increasingly unaffordable, especially for low-income households who are battling to afford enough food each month," Roets added.
“South Africa’s consumer credit crisis isn’t simply a matter of balance sheets and interest rates, it’s a story of households pushed to the brink, of parents borrowing to feed their children, and of ordinary citizens trapped in a cycle of debt just to survive through each month. The country’s economic stress factors, from high borrowing costs to rising prices for essential goods and services like food, fuel, electricity, and water, are forcing millions of consumers to lean heavily on credit and personal loans to make it through the month. Households are living on extremely narrow margins, where one unforeseen cost can derail their already impossibly tight budgets,” Roets said.
"On the other side of the fence are millions of vulnerable households who cannot access credit, and are forced to make impossible choices to survive, like weighing up whether to buy electricity to keep the lights on, or food to feed their families. Right now, life is grim for South Africans from all walks of life who are buckling under the physical and mental repercussions of debilitating financial pressure," Roets further said.
As the country approaches the Budget Speech, the immediate call for action cannot be more pronounced.
Consumers are clinging to hopes that the government will unveil measures to alleviate financial distress, especially as they navigate increasingly demanding budgets fraught with high borrowing costs and rising prices for essential goods and services.
Evidently, the struggles of South Africa’s households reveal that financial pressure is affecting citizens across the board, emphasising that without substantial intervention, many will continue to face challenging decisions that threaten their basic welfare.
The Budget Speech presents an opportunity to government to put the country on the path to financial recovery, which in turn could alleviate some pressures on consumers with fuel price decreases, inflation subsiding making every day items more affordable as well as the South African Reserve Bank announcing decreases in the interest rate.
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