Category: South Africa Government

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Interim measures introduced for municipal Eskom debt

Source: Government of South Africa

Interim measures introduced for municipal Eskom debt

Despite the introduction of the municipal Eskom debt relief programme in 2023, municipalities are still battling to address ballooning debt to the power utility.

According to the department’s Medium Term Budget Policy Statement (MTBPS), the debt has grown to some R94 billion as of the end of March this year – up from some R55 billion.

“While 24 municipalities have qualified for the first one-third write-off after 12 consecutive months of payments and 21 have generally maintained payments, as of 7 May 2025, 47 municipalities remain in default. 

“This is the combined result of weak collections, excessive electricity and water losses due primarily to a lack of maintenance, and inadequate credit control. Measures are being taken to assist municipalities in raising revenue, including expanding smart prepaid metering,” Treasury said.

As an interim measure, struggling municipalities will “transition, where appropriate, to distribution agency agreements (DAAs)”.

“Under these agreements, Eskom will operate municipal electricity services for a defined period, support cost-reflective tariff setting and loss reduction, and assist with collections. 

“During this period, municipalities will be required to select the most appropriate service delivery mechanism, phase in cost-reflective tariffs and limit rebates,” the department said.

Municipalities are urged to direct funding from grants like the Municipal Infrastructure Grant (MIG) to rehabilitating existing water and electricity infrastructure, which are conduits for revenue generation.

“Additional conditions include strict adherence to pro-poor policies to ensure that local governments are providing the required amounts, doing so within national limits and ring-fencing electricity revenues.

“The DAA pathway is intended to stabilise cash flows, improve payment discipline and create a bridge to longer-term structural reforms in the local government fiscal framework.

“The interim measure does not rule out stronger interventions where failures persist,” National Treasury said.

Municipal Infrastructure Grant

At the same time, National Treasury has announced reforms to the Municipal Infrastructure Grant in a bid to cut out underspending, misuse of funds and capacity constraints.

The reforms include a split delivery model aimed at assisting municipalities to accelerate service delivery infrastructure delivery.

“Where municipalities demonstrate proven capacity, funding will continue to be allocated directly. However, in cases of persistent capacity and governance failures, delivery will shift to an indirect model through institutions such as the Municipal Infrastructure Support Agent and the DBSA [Development Bank of South Africa]. 

“This will be accompanied by time-bound capability plans aimed at restoring municipalities to direct funding. The shift to a split-delivery model balances the urgent need to accelerate service delivery with building resilient, capable local government that can sustainably meet the infrastructure needs of their communities,” Treasury noted.

Added to that, a performance-linked incentive is also being introduced to “reward municipalities that deliver fit for purpose infrastructure on time and budget, at reasonable cost, with funded maintenance plans and climate-resilience measures”.

“The reform will be supported by clearer criteria for determining funding modalities, stronger oversight through annual delivery compacts and embedded technical support to build municipal planning, procurement and asset management capability.

“The necessary conditional grant framework amendments will be tabled in the 2026 Division of Revenue Bill, with pilot implementation commencing in 2026/27,” the department added.

Furthermore, a municipal utility reform programme will also be piloted at the Mbombela, Govan Mbeki, Lekwa and eMalahleni municipalities later this year.

“The National Treasury, working with the African Development Bank [AfDB] and donor partners, is implementing a pilot Municipal Utility Reform Programme, under a results-based AfDB concessional loan of up to US$400 million.

“It aims to stabilise and professionalise core municipal utilities [water and electricity] by reducing losses, introducing cost-reflective tariffs with protections for poor households, ringfencing revenues, improving asset care, and enhancing governance and reporting,” Treasury said.

Lessons drawn from the pilot will be used to expand the programme to “municipalities in other provinces facing severe delivery challenges”.

“The scale-up will align with conditional grant reforms and, where appropriate, will disburse grants linked to independently verified milestones to safeguard delivery and fiscal sustainability,” Treasury said. – SAnews.gov.za

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Economic growth to slow marginally in 2025

Source: Government of South Africa

Economic growth to slow marginally in 2025

National Treasury expects South Africa’s economy to grow by some 1.2% this year – marginally down from the 1.4% forecasted in the 2025 Budget.

This according to the Medium Term Budget Policy Statement (MTBPS) released by National Treasury on Wednesday.
The department noted that the outlook reflects a moderate improvement with steady progress in structural economic reforms.

“Government is meeting its fiscal targets and continued strengthening of macroeconomic stability will increase confidence and reduce borrowing costs across the economy, helping to revive investment and employment.

“Over the past year, domestic growth has been affected by greater global uncertainty and volatility, logistical constraints and low levels of business and consumer confidence.

“However, inflation has fallen, and together with prudent fiscal policy, this has reduced the risk premium – the additional return that investors demand to hold South African assets. As a result, borrowing costs have declined and growth prospects have improved,” the department noted.

The real Gross Domestic Product (GDP) is expected to reach some 1.2% in the same period – also reduced from the 1.4% in Budget 2025.
“The revision reflects weaker growth outcomes in the first half of the year, a subdued external environment and low levels of consumer and business confidence.

“Household consumption remained resilient, supported by moderating inflation, lower interest rates and improved credit conditions, but weaker investment, state spending and exports tempered overall expenditure growth,” National Treasury noted.

Over the medium term, however, GDP is expected to average some 1.8%.

“Investment is expected to strengthen over the medium term as measures to lift infrastructure spending take effect and reform implementation gains traction.

“Investment will also benefit from the reduced cost of capital, supported by lower interest rates and the country’s improving risk premium,” said Treasury.

Risks to domestic growth are on the downside.

“Further delays in implementing reforms, particularly in energy and logistics, would impede much-needed growth-enabling investment.

“Conversely, lower inflation and interest rates, and improvements in infrastructure spending would support higher growth,” the department said.

Government has focused the economic growth strategy on four elements: maintaining macroeconomic stability, implementing structural reforms, building state capability and supporting public infrastructure investment.

National Treasury emphasised that raising the growth trajectory “depends on continuing to strengthen macroeconomic stability, accelerating structural reforms, building a capable state and improving public-sector infrastructure investment”.

“Progress is evident but delays in key structural reforms have held back investment, limiting potential opportunities offered by resilience in the global economy.

“This underscores the importance of continued efforts to improve policy certainty, deal decisively with economic blockages and bolster capacity in infrastructure and service delivery,” it said.

A look abroad

On the global front, growth is expected to slow to 3.2% in 2025 with the outlook weaker than a year ago due to tariff shocks and geopolitical challenges.

“Tariffs have not risen as sharply as expected when the US administration made its announcements in April of this year. However, the delayed price effects of such measures, growing protectionism and supply chain disruptions may increase costs, reduce productivity growth and weigh on medium-term economic growth.

“The prospect of higher tariffs buoyed trade in the first half of the year as companies brought forward imports and exports, but this is expected to wane over the remainder of 2025 – as is the impact of deficit spending in advanced economies.

“Global inflation is expected to continue easing over the next two years, led by lower energy and food prices. However, renewed trade disruptions, higher energy costs or the delayed effects of tariff measures could increase price pressures,” Treasury noted. – SAnews.gov.za

 

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Government revises inflation target to 3%

Source: Government of South Africa

Government revises inflation target to 3%

In a landmark moment for South Africa’s monetary policy agenda, government has decided to reduce South Africa’s inflation target to 3%, with a 1 percentage point tolerance band.

This will reduce the cost of living and borrowing costs for households, businesses and government, supporting higher long-term economic growth and job creation. 

Presenting the Medium-Term Budget Policy Statement (MTBPS) at a sitting of the National Assembly at the Good Hope Chamber in Parliament, the Minister said the 1 percentage point band provides flexibility to accommodate any unexpected inflationary shocks

“This decision follows agreement between the Governor of the South African Reserve Bank and my consultations with the President and Cabinet. This new target immediately replaces the previous target range of between 3% and 6% and will be implemented over the next two years,” Minister of Finance Enoch Godongwana said on Wednesday.

This is in line with South Africa’s approach to inflation targeting, which has always been a flexible one, looking beyond short-run deviations in inflation. 

“The Reserve Bank will pursue the target on a continuous basis and clearly communicate any deviations from the target. Over time, the lower target will decrease inflation expectations and inflation, creating room for lower interest rates.

“The short-term fiscal costs of a lower target, which include lower nominal Gross Domestic Product and revenue growth, will make achieving fiscal targets more challenging. 

“Yet the long-term benefits of taking this step far outweigh these costs. We remain committed to ensuring that our macroeconomic policies serve the best interests of all South Africans,” the Minister said.

A lower target aligns the country with international best practice and makes the cost of borrowing cheaper by reducing the inflation risk premium that investors demand to lend to South Africa.

The Minister of Finance and the Governor of the Reserve Bank will closely coordinate policy settings to maximise the economic benefits of the new target and enhance fiscal and monetary policy alignment.-SAnews.gov.za

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SARS welcomes MTBPS

Source: Government of South Africa

The South African Revenue Service (SARS) has welcomed Finance Minister Enoch Godongwana’s  Medium-Term Budget Policy Statement (MTBPS), delivered on Wednesday, showing that the revenue service collected over R900 billion in revenue.

“By 30 September 2025, SARS had collected a net revenue of R924.7 billion, drawn from gross collections of R1 157.6 billion and refund payments of R232.9 billion. This marks year-on-year growth of R78.6 billion and an overall surplus of R18 billion against the printed estimates, indicating a promising trajectory for the second half of the financial year. Nearly 50% of the better than estimated performance came from compliance efforts,” the revenue service said on Wednesday.

In its statement, the revenue service welcomed the tabling of the MTBPS and the Minister’s revision of the 2025 Budget net tax-revenue estimate, from R1 985.6 billion to R2 005.3 billion.

Commissioner Edward Kieswetter expressed SARS’s support of the Minister’s statement, which charts a clear and pragmatic roadmap for South Africa’s fiscal sustainability.

“The MTBPS sets out bold measures to strengthen the country’s economic resilience. SARS is committed to supporting these objectives by focusing on robust revenue collection, improved compliance and trade facilitation through consistent effort, operational excellence, and innovation,” said Kieswetter. 

This as SARS’s compliance programme continues to deliver results. In the same period, SARS secured R131.6 billion from compliance activities, up from R122.6 billion in the previous year. 

Debt collections reached R47.1 billion, an increase of R3.3 billion (7.5%), reinforcing SARS’s contribution to the national fiscus.

The revenue service credited the SARS’s achievement to the effort of its employees and compliant taxpayers. 

“Behind these numbers are the dedicated SARS employees who perform millions of little things daily, and many compliant taxpayers whose contribution make this success possible. Their commitment is to help to strengthen South Africa’s fiscal outlook and build momentum for the future. These results underscore SARS’ effectiveness in revenue collection and is positive for the country’s fiscal outlook,” said the Commissioner.

Building on this momentum, revenue collection has demonstrated resilience across major tax categories. 

Collections from Corporate Income Tax (CIT), PAYE, Dividends Tax, Domestic VAT, General Fuel Levy (Imported), as well as lower-than-estimated VAT-refund payments, consistently outperformed expectations, reinforcing SARS’s role in sustaining fiscal stability.

On Corporate Income Tax (CIT): Year-to-date CIT Provisional Tax payments amounted to R164.5 billion, growing by R14.2 billion (9.5%) and exceeding the printed estimates by R4.7 billion (3.0%).

Collections were boosted by SARS invoking Paragraph 19(3) that yielded an additional R10.0 billion with the main contributors being companies in the Mining and Finance sectors. 

The mining sector continues to encounter significant challenges because of softening commodity prices for palladium, iron ore, and coal. These price fluctuations affect the profitability of companies, resulting in downward pressure on CIT provisional payments. 

On Pay As You Earn (PAYE), collections of R371.0 billion recorded growth of R30.9 billion (9.1%) against the prior year and exceeded the printed estimate by R3.2 billion (0.9%). 

The year-on-year growth was driven mainly by payments from employers in the finance and community sectors. 

Tax proposals announced at Budget 2025 included no inflationary adjustments to  Personal Income Tax (PIT) tax brackets and rebates; measures expected to yield R16.7 billion for the full year.

 “In the first half of the year, PAYE collections from Two-Pot withdrawals were based on a total gross withdrawal of R18.2 billion and taxable amounts valued at R5.2 billion.”

Meanwhile, dividend tax collections amounted to R22.3 billion, growing by R5.3 billion (31.0%) against the prior year and recording a surplus of R4.6 billion (25.7%) against the printed estimates. 

This included a significant once-off payment of R1.4 billion, whilst the main drivers of this growth were the finance, manufacturing, and wholesale and retail sectors.

Domestic VAT collections totaled R292.7 billion, representing a year-on-year increase of R21.1 billion (7.8%). This was driven mainly by growth in the finance, wholesale and retail, and manufacturing sectors, and partially offset by the transport sector.

Year-to-date Domestic VAT collections exceeded the printed estimates by R5.2 billion (1.8%).

In addition:
•    Import VAT significantly underperformed by R3.7 billion due to a lower growth in the value of imports 1.2%, which were expected to grow by 5.4% over the full year.
•    Lower than expected VAT refund payments, totaled R183.9 billion, or a marginal increase of R0.2 billion (0.1%) from the prior year. This positive outcome is the result of the continued focus on SARS efforts to curb impermissible and fraudulent refund claims. Refund risk management contributed most significantly to the solid improvement in overall Net VAT revenue.
•    General Fuel Levy collections of R44.7 billion were R2.1 billion (5.0%) higher than in the prior year and exceeded the printed estimates by R2.3 billion (5.3%). Fuel declarations for April to September 2025 recorded a total year-on-year net growth of 2.1% (241.9 million litres) in volume. Declarations from importers increased by 133.1% (3 605.3 million litres) and were partially offset by declarations from local manufacturers, which contracted year-on-year by 39.0% (3 363.4 million litres). 

SARS said these surpluses were partially offset by lower-than-expected collections from PIT Provisional taxes, PIT Assessments, and Customs taxes; as well as higher-than-estimated PIT refund payments.

This as PIT Refunds of R32.2 billion recorded growth of R4.5 billion (16.2%) against the prior year and exceeded the printed estimates by R1.4 billion (4.4%). In addition, 7.3 million PIT returns were received (compared to 6.6 million at the same time in the prior year). Of these, 5.7 million returns were auto-assessed compared to 4.8 million for the previous year. 

Integrity and trust 

Commissioner Kieswetter reaffirmed SARS’s commitment to building a smart, modern institution anchored in integrity and trust. 

“Our role extends beyond revenue collection; we advance national fiscal goals in the face of persistent challenges such as debt, unemployment, and inequality. With government depending on tax revenues for around 90% of expenditures, strong domestic resource mobilisation is essential to safeguard fiscal integrity and reduce reliance on external funding”.

To accelerate these gains at Budget 2025, Minister Godongwana allocated an additional R7.5 billion to SARS over the Medium-Term Expenditure Framework (2025/2026; 2026/2027; 2027/2028). –SAnews.gov.za

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New inflation target decision followed consultation

Source: Government of South Africa

The announcement of a new inflation target for South Africa of 3% with a 1 percentage point tolerance band, follows agreement between the Governor of the South African Reserve Bank (SARB) Lesetja Kganyago and the Minister of Finance Enoch Godongwana.

Minister Godongwana, who made the announcement during the Medium Term Budget Policy Statement on Wednesday, had further consulted with the President and Cabinet on the decision.

A statement issued jointly by the National Treasury and the South African Reserve Bank said the 1 percentage point band provides flexibility to accommodate any unexpected inflationary shocks.

“This is in line with South Africa’s approach to inflation targeting, which has always been a flexible one, looking beyond short-run deviations in inflation,” said the statement.

As part of a broader review of macroeconomic policy and in line with international developments, National Treasury and the SARB, both separately and collaboratively through the Macroeconomic Standing Committee, undertook a comprehensive assessment of the appropriate level of the inflation target.

This work has now been concluded and recommended a revision to the target to strengthen the framework and enhance price stability by better anchoring inflation expectations and aligning South Africa to international best practice.

“The new target immediately replaces the previous target range of between 3 and 6%, and will be implemented over the next two years. Over time, the lower target will decrease inflation expectations and inflation, creating room for lower interest rates. This supports household spending and business investment, boosting economic growth and job creation,” the statement said.

The benefits and costs of a lower target were carefully considered in the decision, said the National Treasury and Reserve Bank.

“While, the short-term fiscal costs of a lower target, which include lower nominal gross domestic product and revenue growth, make achieving fiscal targets more challenging, the long-term benefits for the economy far outweigh the costs.

“The SARB will pursue the target on a continuous basis and clearly communicate any deviations from the target.”

National Treasury and the SARB said they will continue working closely to ensure effective policy coordination as the economy navigates global uncertainty and domestic structural challenges. – SAnews.gov.za
 

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Decision on proposed R20 billion tax increases still to be made

Source: Government of South Africa

South Africans will have to wait until the 2026 Budget to find out whether the proposed R20 billion in additional tax increases can be withdrawn. 

Presenting the Medium-Term Budget Policy Statement (MTBPS) at a sitting of the National Assembly at the Good Hope Chamber in Parliament, Minister of Finance Enoch Godongwana said a final decision will be announced in the 2026 Budget. 

“As indicated in the 2025 Budget, an additional R4 billion was allocated to the South African Revenue Services (SARS). This allocation was intended in part to strengthen debt collection, and thereby increase revenue collected, by between R20 and R50 billion per year.

“We will continue to monitor SARS’s revenue performance for the remainder of the year. This assessment will inform whether the R20 billion in additional tax increases for the 2026 Budget, as earlier proposed, can be withdrawn,” the Minister said on Wednesday.

He said the better than estimated tax revenue, of R19.7 billion, is due to stronger household expenditure, which has boosted value-added tax collections, and improvements in corporate tax receipts and dividend tax. 

“Lower than expected VAT refunds also contributed to the improved revenue outlook. This higher revenue allows us to bring forward some once-off expenditure,” the Minister said.

Adjustments 

For the current year, an additional expenditure of R15.8 billion is proposed. 

“Madam Speaker, the adjustment in revenue means that we can make changes to our spending estimates. Amongst the in-year adjustments is also R2 billion for the rebuilding of Parliament, and R1 billion to the Independent Electoral Commission for the 2026 municipal elections. 

“In addition, the spending announced in the May Budget for the National Dialogue, as well as its carry through costs, are catered for. 

“These allocations are on top of the additional funding provisions for Education and Health announced in the May Budget,” the Minister said.

Combating the illicit economy

According to SARS, since 2020, government has lost around R40 billion in excise revenue to the cigarette black market.

“The same is true for illicit alcohol and fuel. Government is clamping down on this illegal trade. In the last six months, SARS suspended three licenses for non-compliant tobacco production,” the Minister said.

He highlighted that South Africa faces a problem of illicit trade that threatens the economy, endangers consumers, and robs the fiscus of billions in revenue.

“The Financial Intelligence Centre has provided intelligence reports to SARS to assist in investigations of criminal syndicates. 

“Together they have identified illicit markets in tobacco, precious metals, fuel and procurement fraud,” the Minister said.

Godongwana called on customs officials to fulfil their duty to prevent criminals from dodging taxes and flooding the markets with dangerous products. –SAnews.gov.za

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Government on path to increase infrastructure development

Source: Government of South Africa

With the recognition that higher and more efficient infrastructure investment is essential to unlock faster and more inclusive growth, government is partnering with the private sector to strengthen infrastructure delivery and improve the quality of spending.

“We are leveraging public resources to mobilise private finance and expertise at scale to strengthen service delivery, improve spending effectiveness and drive higher economic growth,” Minister of Finance Enoch Godongwana said on Wednesday.

Presenting the Medium-Term Budget Policy Statement (MTBPS) at a sitting of the National Assembly at the Good Hope Chamber in Parliament, the Minister said capital payments are the fastest growing expenditure item at 7.5% over the medium-term.

In line with the vision contributing towards economic growth and advancing the pillar of growth-enhancing infrastructure, government is shifting the composition of spending from consumption to investment. 

The amendments to Public Private Partnerships (PPPs) took effect on 1 June 2025, and these unlock the potential across spheres of government and streamline approvals for smaller projects.

“Three weeks ago, new guidelines on unsolicited bids and fiscal commitments and contingent liabilities were issued and these took effect immediately. 

“The unsolicited bid guideline provides a clear structured pathway for the private sector to submit project ideas to government. 

“It also provides a framework for reporting and managing of fiscal commitments and contingent liabilities arising from PPP projects,” the Minister said.

Municipal PPP regulations will be amended by 2026. 

Leveraging lessons from the Renewable Energy Independent Power Producers (IPPs) project, to streamline planning and procurement, the Department of Transport’s private-sector participation unit is reviving the passenger transport and logistics sector. 

“Following strong interest from the freight logistics requests for information, the unit will issue the first rail corridor request for proposal by December 2025, with others following in early 2026. 

“The unit has also issued requests for information for investment opportunities in modernising and growing the passenger rail system. 

“The Water Partnerships Office is making progress in preparing non-revenue water and reuse projects across municipalities. These will create a robust pipeline for the private sector to co-invest in,” the Minister said.

Government has reconfigured the Budget Facility for Infrastructure (BFI) to run four bid windows annually instead of just one.

Since the reconfiguration, the BFI has received 28 submissions. Nine projects were accepted for detailed analysis. 

“Funding to the tune of R4.1 billion is also allocated for disaster relief to fix schools, pipelines, clinics and substations damaged between last year and this year by flooding in KwaZulu-Natal, Mpumalanga, and the Eastern Cape. 

“To raise the funding for these BFI projects, a new infrastructure bond will be launched soon to raise a minimum of R15 billion.

“The bond forms part of our efforts to introduce dedicated financing instruments that can mobilise cheaper financing to support our infrastructure agenda,” the Minister said.

Government will also contribute to R2 billion to capitalise the Credit Guarantee Vehicle. 

“Initially, the vehicle will support electricity transmission expansion, directly contributing to our efforts at energy security while also driving decarbonisation. 

“This heralds a new era in PPPs, where private investment in high-voltage transmission lines is enabled. This is real progress in our move away from merely fixing the power utility to securing power to the grid from a range of sources.

“This is real progress in our move away from merely fixing the power utility to securing power to the grid from a range of sources,” he said.

The Minister said it was a key and innovative part of infrastructure reforms developed with international partners to de-risk private investment without state guarantees.

“We are also committed to simplifying the institutional arrangements across the infrastructure ecosystem. The new Infrastructure Finance and Implementation Support Agency will be operational by March 2026,” he said.

The agency will provide project preparation support to supply the BFI pipeline. 

“It will centralise infrastructure finance functions to systematically crowd-in private capital and promote the use of alternative delivery mechanisms. 

“Madam Speaker, municipalities are at the forefront of providing essential services. However, many are fraught with capacity constraints that hinder their ability to turn allocated budgets into reliable services. 

“It is for these reasons that several reforms have been introduced to urgently remedy this untenable situation,” the Minister said.

Government is piloting a utility reform programme to stabilise and professionalise water and electricity businesses in a few municipalities in Mpumalanga.

“We will use accredited indirect delivery partners such as the Development Bank of Southern Africa (DBSA) and the Municipal Infrastructure Support Agent (MISA) to provide the infrastructure while building municipal capability to do this on their own. 

“Honourable members, this is how we will ensure that our goal of public sector investment in infrastructure exceeds the R1 trillion mark over the next three years,” the Minister said. – SAnews.gov.za

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Public Procurement Payments Dashboard goes live

Source: Government of South Africa

Wednesday, November 12, 2025

Government has launched the Procurement Payments Dashboard to improve transparency and accountability in public procurement.

This was announced by Finance Minister Enoch Godongwana during the Medium Term Budget Policy Statement (MTBPS) in Parliament on Wednesday.

The dashboard will use data pulled from government’s payments systems including the Basic Accounting System (BAS) as well as the supplier database, supplemented by contract data reported on the eTender Portal and supplier information from the Central Supplier Database.

“This dashboard, which is available on the National Treasury eTender website, shows the payments made to suppliers by most national and provincial government departments as captured on our payments system.

“This represents a massive step forward in procurement transparency. The dashboard will help identify inefficiencies, anomalies and uncovering opportunities for consolidation.

“It also enables analysis of procurement expenditure and the suppliers that do business with the state, giving citizens, academics and civil society the ability to hold departments accountable supporting efforts to fight corruption and fraud,” the Minister said.

Rooting out corruption

An audit to identify ghost workers and payment irregularities across national and provincial departments has identified nearly 9000 high-risk cases requiring further verification.

“We are…waging war on ghost workers in public service. We have heard calls from all political parties and civil society.

“National Treasury is working closely with the Department of Public Service Administration and Home Affairs on a data-driven approach that integrates systems across government,” the Minister said.

According to National Treasury, the verification process of the high-risk cases will begin in January followed by “appropriate legal action”.

“The next phase of this project will use a single sign-on application being developed for public servants as well as improvements to the government payroll system to automate monitoring to prevent irregularities and improve spending efficiency,” the department said. – SAnews.gov.za

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Infrastructure drive firmly on the roll

Source: Government of South Africa

Efforts to step infrastructure development are accelerating in South Africa – to support economic growth and drive improved service delivery.

This is according to National Treasury’s Medium Term Budget Policy Statement (MTBPS) released on Wednesday. 

In the maiden budget speech of the Government of National Unity (GNU) earlier this year, Finance Minister Enoch Godongwana announced a R1 trillion allocation for infrastructure investment over the medium term. 

“Infrastructure investment has strong direct and indirect effects on growth, boosting demand for inputs and workers in the short term and expanding the economy’s capacity to produce over the longer term.

“Reforms are under way to mobilise private-sector finance and technical expertise at scale. In parallel, there are initiatives to strengthen government’s ability to deliver infrastructure more efficiently and improve spending outcomes.

“These actions will address the persistent underspending of infrastructure budgets and enhance value for money,” National Treasury said.

Reforms to create a conducive environment for public-private partnerships (PPP) by “improving the PPP framework, strengthening institutional arrangements and enhancing monitoring and reporting”.

Amendments to Treasury Regulation 16 – which addresses PPPs – took effect in June.

“In October 2025, guidelines relating to unsolicited bids and fiscal commitments and contingent liabilities were published and took effect. These provide a clear, structured pathway for the private sector to submit innovative project ideas, including provisions for recoverable development fees. 

“They also provide a framework to identify, manage and report on fiscal commitments and contingent liabilities in anticipation of the expansion of the PPP market. Updates to the PPP manual and the development of sector-specific toolkits in priority sectors will be completed in 2026,” Treasury added.

Amendments to municipal PPP regulations are underway and are expected to be completed by February 2026, following COGTA concurrence.

Tabling the MTBPS in Parliament on Wednesday, the Minister gave more details on the reconfiguration of the Budget Facility for Infrastructure (BFI) which will now run four bid windows per year instead of one.

“Since the reconfiguration, the BFI has received 28 submissions. Nine projects were accepted for detailed analysis.

“Funding to the tune of R4.1 billion is also allocated for disaster relief to fix schools, pipelines, clinics and substations damaged between last year and this year by flooding in KwaZulu Natal, Mpumalanga, and the Eastern Cape,” he said.

A new infrastructure bond is expected to be launched to raise some R15 billion aimed at funding these BFI projects.

“The bond forms part of our efforts to introduce dedicated financing instruments that can mobilise cheaper financing to support our infrastructure agenda.

“Government will also contribute to R2 billion to capitalise the Credit Guarantee Vehicle. Initially, the vehicle will support electricity transmission expansion, directly contributing to our efforts at energy security while also driving decarbonisation.

“This heralds a new era in PPPs, where private investment in high-voltage transmission lines is enabled. This is real progress in our move away from merely fixing the power utility to securing power to the grid from a range of sources,” Godongwana added.

The Infrastructure Finance and Implementation Support Agency is expected to be operational by March 2026 to “infrastructure finance functions to systematically crowd-in private capital and promote the use of alternative delivery mechanisms”. – SAnews.gov.za

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South Africa reaffirms commitment to equitable water and sanitation access

Source: Government of South Africa

The Ministry of Water and Sanitation has reaffirmed its commitment to accelerating equitable and sustainable access to water and sanitation services across South Africa.

The commitment was made at the Association of Water and Sanitation Institutions of South Africa (AWSISA) Africa and Global South Water and Sanitation Dialogue, which is currently underway at Emperors Palace, in Johannesburg.

The dialogue was formally declared opened by Deputy President Paul Mashatile, supported by the Minister of Water and Sanitation, Pemmy Majodina, through a virtual address on Monday, 10 November 2025.

In his address, the Deputy President highlighted the urgency of advancing water security and dignified sanitation across all communities, while strengthening partnerships across Africa and the Global South.

More than 1,500 delegates are in attendance, including government leaders, water utility executives, researchers, civil society organisations, youth innovators, and private sector partners.

The Ministry recognises that Africa’s water and sanitation challenges are shared, transboundary and deeply interconnected. This is why South Africa continues to work closely with African governments, regional bodies and strategic global partners to advance the Africa Water Vision 2063, which seeks a prosperous and water-secure continent where water is equitably and sustainably managed.

Held under the theme: “Towards Sustainable Water and Sanitation Security in Africa”, the dialogue reflects and acknowledges the shared exposure to climate shocks, rapid urbanisation and the systemic pressures facing public infrastructure and institutions.

The dialogue goes beyond knowledge exchange but also creates a strategic platform, where policy harmonisation is pursued, technological solutions are tested for local relevance and cross-border partnerships are strengthened.

It also aims to accelerate infrastructure delivery, align regulatory reforms and unlock blended investment models capable of sustaining long-term development.

In her address, Water and Sanitation Minister Pemmy Majodina reiterated and emphasised the Ministry’s commitment to enhancing the delivery of water and sanitation services across the country, especially in disadvantaged and underserved communities.

“Our commitment is deeply rooted in restoring dignity to our communities. We are intensifying our work in the most disadvantaged and underserved areas. Every household, every school and every clinic deserves safe and dependable water. This is not just an aspiration; but a right we are actively realising through investment, partnership and accountable delivery,” Majodina said.

AWSISA was officially established in August this year through a Memorandum of Cooperation with the Department of Water and Sanitation. This milestone marked a shared effort to strengthen collaboration across the sector and expand access to clean water and dignified sanitation for communities in South Africa and across the continent.

The agreement cemented a unified commitment to unlock investment, drive innovation, and accelerate service delivery. It also provides a framework for aligning sector strategies and plans, promoting joint engagement on policy and regulatory reform, advancing research, data-sharing, and sector-wide capacity building, amongst others.

South Africa remains steadfast in advancing the Sustainable Development Goals, especially SDG 6 on Clean Water and Sanitation and in supporting Africa’s collective progress toward a just, inclusive, and water-secure future. – SAnews.gov.za