UASA Media Release: 12 March 2025
Image source: www.msn.com
Statement by Abigail Moyo, spokesperson of the trade union UASA:
The National Budget Speech tabled by Finance Minister Enoch Godongwana this afternoon leaves us perturbed as we question whether the plans and strategies presented will bear fruit after a decade of economic stagnation.
We have seen all investment strategies presented before, as well as the increased taxes over the years. Yet, the government has not succeeded in growing the economy or reducing the national debt to a level harnessing economic growth and development.
UASA frowns at Godongwana’s statement about caring for South Africans and considering their daily hardships while at the same time still increasing the Value Added Tax (VAT) rate by 1% to 16% over the 2025/26 and 2026/27 period. Reducing and reworking the increase from the previously declined 2% increase does not mean consumers will have it better. On the contrary, it proves that the cost of living will continue to distress ordinary citizens.
There are many ways that the government could have cut expenses and accumulated funds to grow the economy without placing people under more financial duress. Although no inflationary adjustments will be implemented to personal income tax brackets, rebates, and medical tax credits, income tax-paying households will still be affected as rebates and tax brackets haven’t been adjusted for inflation for the second year in a row.
UASA also frowns at the absence of a detailed plan to reduce the unemployment rate. Reviewing duplication and improving operational efficiencies in the 100 active labour market programmes in over 20 public institutions cannot possibly be the only strategy up the government’s sleeve for the rest of the financial year while the unemployment rate skyrockets.
UASA welcomes the following positive decisions tabled:
• More than R1 trillion in public infrastructure spending over the next three years will go to mainly transport and logistics, energy infrastructure, and water and sanitation.
• R100 billion spending over the medium term by the South African National Roads Agency (SANRAL) to keep the national road network in good condition.
• R19.2 billion over the medium term to the Passenger Rail Agency of South Africa (PRASA) for critical signalling upgrades enabling commuters from selected townships to catch a train every 10 minutes to get to and from work and significantly reduce the money low-income households spend on transport.
• Investments in several large-scale dam projects, including the Mkhomazi Project and the Berg River-Voëlvlei Augmentation Scheme, to improve water security in eThekwini and the Western Cape.
• The R284.7 billion allocated to social grants and R35.2 billion to an extension of the COVID-19 Social Relief of Distress Grant to March 2026.
• The fuel levy and the Road Accident Fund levy remaining unchanged for another year, saving consumers around R4 billion.
We hope Godongwana’s decision to audit ghost workers in national and provincial departments will not leech into taxpayers’ money instead of saving taxpayers’ money.
Godongwana should have devised a sustainable investment plan to turn the economic outlook around and ease South Africa’s debt burden. An increase in public debt from around R70,000 per working-age South African to 115,000 within a decade, with some 22c out of every rand earned in tax used to repay debt, is not sustainable for the future of our country.
For the first Budget under the Government of National Unity (GNU), we expected more strategic plans to tackle unemployment challenges and move forward to a conducive economic outlook. With a new government on the horizon, we cannot keep repeating the same fables without any realistic plans.
South African leaders need to bring solutions for South Africans and the future.
For further enquiries or to set up a personal interview, contact Abigail Moyo at 065 170 0162.