Enoch Godongwana's MTBPS: Another Test for SA's Financial Integrity

Zamikhaya Maseti

Tomorrow, the Minister of Finance Enoch Godongwana will rise before the nation to deliver the Medium-Term Budget Policy Statement (MTBPS), and the expectations are not only economic but profoundly political and ethical.

South Africa stands again at a decisive fiscal crossroads where every sentence uttered in Parliament will echo far beyond the corridors of the National Treasury, reverberating in the households of the unemployed and boardrooms of the private sector. This is not merely a budget; it is a test of confidence in the state itself, in its coherence, its honesty, and its capacity to govern with conviction.

The national mood is brittle, the economy is stagnant, and the patience of ordinary citizens is wearing thin. Inflation has moderated yet remains above comfort levels for low-income families. Growth projections are sliding, and public institutions continue to wobble under the weight of inefficiency and patronage.

In this volatile atmosphere, his task is both technical and moral to demonstrate that fiscal prudence and developmental ambition are not mutually exclusive but can be harmonised through discipline, vision, and credible execution.

His May 2025 Budget offered a cautious optimism that now seems almost prophetic in its restraint. Then he spoke of stabilising debt at 77,4 percent of GDP, of maintaining a modest primary surplus, of increasing the fuel levy while protecting households from VAT hikes, and of directing sixty cents of every non-interest rand toward the social wage.

It was a budget anchored in a vision of balance between compassion and control, between fiscal orthodoxy and developmental necessity. Yet the months since that budget have revealed the stubbornness of the South African economic condition. 

The Minister will therefore approach Wednesday's podium not with triumph but with sobriety. His MTBPS must recalibrate expectations and reaffirm that growth will not emerge through reckless spending but through the steady construction of institutional capability and reform. The economy, forecast to grow at 1,4 percent, may now be revised even lower.

Revenue collection, despite improved compliance, has underperformed because corporate profits are down, and household spending remains muted. Debt-service costs are rising and threaten to crowd out social expenditure. This is the arithmetic of constraint that the Minister must transform into a narrative of discipline and determination.

There will be no grand gestures. Expect instead a language of restraint, reprioritisation, and reform. Treasury insiders signal that there will be no new broad-based tax increases, but rather an intensified focus on compliance, enforcement, and the recovery of illicit revenue losses. The South African Revenue Services (SARS) will be projected not as a bureaucratic instrument but as a moral weapon in defence of fiscal integrity.

The Minister will emphasise a more efficient procurement system, tighter oversight over contingent liabilities, and a renewed partnership with the private sector in infrastructure financing. The tone will differ from May’s cautious optimism. It will be more surgical, more grounded, and more demanding of the State itself. Expect Godongwana to remind the country that fiscal stability is a precondition for inclusive growth, not its enemy. The spending envelope will likely narrow. 

Most certainly, Treasury will shift funds from underperforming programmes toward infrastructure renewal, State maintenance, and the essential services that anchor human development. Health, education, and local government will be protected where possible, but must deliver more with less. The wage bill will again come under scrutiny as the government negotiates the politics of affordability in a restless labour environment.

Beyond numbers, the MTBPS will seek to reignite faith in the State as a developmental instrument. Infrastructure investment will remain the cornerstone of that vision. Expect reaffirmations of the one-trillion-rand investment pipeline over the medium term, but this time the Minister will stress implementation capability, project management, and accountability. Infrastructure must not be another slogan but a functioning system that generates jobs, connects regions, and sustains growth. 

Godongwana must also confront the deeper question of economic coordination and coherence. Fiscal consolidation without a corresponding growth strategy is self-defeating. South Africa needs a new developmental compact in which the State, Business, and Labour work with clarity of purpose.

The Medium-Term Statement must articulate this compact not as a negotiation of convenience but as a shared commitment to structural transformation, industrialisation, and productive employment. It requires an active, capable State that plans, finances, and delivers, not a reactive one that merely administers decline.

The Minister must defend fiscal orthodoxy without feeding the opposition narrative that the government has lost its developmental soul. It is a delicate choreography, a dance between ideology and realism.

His credibility will depend on how he frames this balance, whether he can speak with honesty about the limits of the fiscus while invoking hope for a just economic renewal. The credibility of this budget will not be tested in the numbers but in the months that follow, in whether the State can execute the proposed reforms. 

The challenge before him is not to invent new policies but to restore belief in old commitments. The architecture of fiscal prudence is already there, the language of reform familiar; what remains missing is the moral muscle of execution. 

The MTBPS will thus mark a decisive moment for South Africa. It will reveal whether the government still believes that reform and redistribution can coexist within a disciplined fiscal framework, whether it still believes that the State can drive growth through competence rather than slogans.

Yet beyond the arithmetic of deficits and surpluses lies a deeper question about the developmental state itself. South Africa can no longer afford a passive or symbolic developmental posture; it must re-engineer its institutional machinery to create a new cycle of industrialisation, infrastructure investment, and spatial transformation.

 The rebuilding of the developmental state demands a new alliance between public intent and financial muscle, and that muscle resides not only in the fiscal arm of the State but in its broader network of Development Finance Institutions (DFIs), State-Owned Companies (SOCs), Provincial Entities, and District Development Agencies.

Institutions such as the Development Bank of Southern Africa (DBSA), the Industrial Development Corporation (IDC), and the Land and Agricultural Bank of South Africa (Land Bank) must be repositioned as the genuine developmental arms and legs of the State, not as fiscal ornaments or bureaucratic intermediaries.

They must all become catalytic instruments that translate national policy into local economic reality. Equally important is the overhauling of the entire development-finance landscape from which they derive their collective mandates. Together, they must mobilise capital, crowd in private investment, and ignite productive capacity across provinces, townships, and rural nodes. 

Board of Directors must earn their fees, not attend meetings merely to sign registers and reap huge Board fees without shaping the national development-finance landscape.  These times require the optimal use of every resource at the State's disposal, for every rand must now become an instrument of reconstruction and growth.

When Godongwana rises on Wednesday, he must not only present the fiscal map but also redraw the national imagination of development. He must affirm that South Africa’s recovery will not be imported; it will be built through its own institutions, its own ingenuity, and its own will to govern. 

The question, therefore, is not merely whether the numbers will add up, but whether the State will rise again as a developmental force. If Godongwana can restore that belief, the MTBPS will not just balance the books; it will begin to balance the future.

* Zamikhaya Maseti is a Political Economy Analyst and holds a Magister Philosophae (M.Phil) in South African Politics and Political Economy from the erstwhile University of Port Elizabeth, now Nelson Mandela University.

** The views expressed do not necessarily reflect the views of IOL, Independent Media or The African.