Medium-Term Budget | Call for focus on unemployment and essential services

Political parties have called on the government to use the upcoming Medium-Term Budget Policy Statement (MTBPS) to tackle unemployment, protect essential services, and drive economic growth.

Finance Minister Enoch Godongwana is scheduled to deliver the statement in Parliament on Wednesday, outlining the country’s fiscal and economic outlook for the next three years.

Build One South Africa (BOSA) said the MTBPS provides a “vital opportunity for government to course-correct what isn’t working and reallocate funds toward priorities that can drive growth and protect the most vulnerable citizens.”

BOSA spokesperson Roger Solomons warned that South Africa faces a “challenging macroeconomic environment, with average economic growth stagnating at just 1% over the past decade and a growing national debt that threatens long-term fiscal stability.”

He highlighted entrenched unemployment, noting that 12.6 million South Africans are currently unable to find work, with young people aged 15 to 34 particularly affected.

Solomons urged that frontline services, including education, healthcare, policing, and infrastructure, must be protected and, where necessary, increased.

“Classrooms are overcrowded, hospitals and clinics are understaffed and face material shortages, and our streets are the playgrounds for criminals and gangsters. To grow the economy requires a stable society,” he said.

Solomons also called for cuts to administrative waste and political perks, including VIP protection for politicians, and suggested consolidating departments such as the Department of Small Business Development and the Department of Planning, Monitoring and Evaluation to redirect funds to essential services.

He further proposed redirecting Skills Education Training Authority (SETA) funding to basic education and introducing a 6% national “sin tax” on online gambling as a new revenue source, with funds earmarked for youth development and rehabilitation programs.

On infrastructure, Solomons called for a dedicated development fund and the establishment of township manufacturing hubs through Special Economic Zones (SEZs) to stimulate job creation and economic empowerment.

The Democratic Alliance (DA) also weighed in ahead of the MTBPS. Finance spokesperson Mark Burke said the party expects the government to “break the cycle” of recurring spending surges, revenue shortfalls, and tax hikes.

He stressed that the upcoming statement should focus on identifying and cutting wasteful spending rather than introducing new taxes. “Spending reviews, followed by cuts in wasted spending, need to become an annual process,” Burke said.

He also called for a commitment to no increases in VAT, corporate tax, or income tax, including ending bracket creep, while encouraging updates on government initiatives such as the eradication of ghost workers, metro trading services reform, and private sector participation in electricity, rail, and ports.

Songezo Zibi, leader of Mzansi Rise and chairperson of SCOPA, said the Minister of Finance must provide clarity on the state of the economy over the next three years, noting which sectors are growing and which are not.

Zibi highlighted the importance of adjustments to this year’s earlier budget, saying the MTBPS should indicate whether resources have been reallocated to essential services such as infrastructure, social grants, and the social wage to improve the lives of ordinary South Africans.

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