Overly prudent is the best phrase to describe it. The 2024 Medium-Term Budget Policy Statement (MTBPS) in South Africa played it safe and
gave no clear indication of what's forthcoming from the Government of National Unity (GNU). The 2024 February National Budget Speech was cautious due to the looming elections, but now was an opportunity to provide some much-needed direction on where the country is heading.

Instead, what we got was more of the same - incremental tweaks, modest adjustments, and a maintenance of the status quo. Missing was the bold vision required to tackle South Africa's pressing economic challenges. There were limited significant new proposals or game-changing initiatives that could help inspire confidence and chart a clear path forward, or at least provide a view of what the next four years may present under the GNU.

Looking forward to next year’s budget speech, we hope to see more progress on the implementation of major projects, such as Operation Vulindlela, specifically - the e-Visa for 34 countries. This will boost the tourism industry, encourage foreign direct investment (FDI), and may aid in the acceleration of the Africa Continental Free Trade Area (AfCFTA) agreement. We are keen to see the stability of state-owned enterprises (SOEs), the traction of the National Health Insurance (NHI) and clarity on how it will be funded.

There was no evident plan to address our debt crisis, but it was acknowledged as a crisis. The only way to successfully manage our debt is to manage expenditure but not at the cost of cutting healthcare and education expenditure.

There was a focus on infrastructure, we hope to see more groundbreaking elements and a consideration of climate factors so these are fit for purpose for our future. There are challenges specifically in the construction industry, which hasn’t grown in several years, however, we are hopeful that we will find the right solutions.

We were also hoping to see how the tax collections on Two-Pot Retirement withdrawals contributed to the overall revenue, perhaps this will be addressed in February. However, we welcome the funding proposal for the South Africa Revenue Service which will further support the revenue authority’s digital transformation journey. We hope this will include the modernisation of our VAT system to prevent potential tax leakages.

We remain hopeful and optimistic due to the “relentless focus on growth” and with the GNU, there are new perspectives which we hope will contribute to our success as a country.

Need more insights?

Download our 2024 Deloitte Africa post-MTBPS infographic.