The Standing Committee on Finance and the Select Committee on Finance have concluded their consideration of the 2026 Revised and Proposed Fiscal Framework, following the adoption of their respective reports on the framework and revenue proposals.
The reports, adopted on 11 November 2026, will now be considered by the National Assembly and the National Council of Provinces (NCOP) for adoption, bringing the parliamentary committee stage of the process to a close.
The committees adopted their reports after considering the revised fiscal framework tabled by the Minister of Finance, Mr Enoch Godongwana, on 21 October, briefings by the National Treasury, the Parliamentary Budget Office (PBO) and the Financial and Fiscal Commission (FFC), as well as submissions received during public hearings on 28 October.
In their reports, the committees acknowledged progress in stabilising public finances, including the stabilisation of gross loan debt at 78.4% of GDP in 2025/26, a growing main budget primary surplus, a narrowing budget deficit and improved revenue performance. They also recognised the positive ratings actions by the three major credit rating agencies and the contribution of the South African Revenue Service (SARS) to improved revenue collection.
However, the committees emphasised that fiscal stability must translate into stronger economic growth, employment creation and improved public service delivery.
A key concern raised in the reports is South Africa’s subdued economic growth outlook. The National Treasury revised its real GDP growth projection for 2026 downwards from 1.6% projected in the 2026 Budget to 1.2%, with growth expected to reach 2% by 2029. This is against the backdrop of unemployment reaching 33.6% in the second quarter of 2026.
The committees are concerned that average projected growth of less than 2% over the medium term will be insufficient to address unemployment, poverty and inequality. They recommend that the National Treasury report to Parliament in the 2027 Budget Review on how the revised fiscal framework supports the growth and employment targets of the Medium-Term Development Plan, including the reforms underpinning the growth projections and the consequences of implementation delays.
On public finances, the committees note that debt-service costs are projected at R441.5 billion in 2026/27, absorbing approximately 21 cents of every rand of main budget revenue. They also highlight the need for further engagement on the proposed fiscal anchor, particularly the implications for Parliament’s oversight responsibilities and the capacity of the PBO and FFC to perform their envisaged roles in the fiscal sustainability framework.
The reports further highlight concerns about the composition of government expenditure and the potential consequences of planned savings amounting to R38.1 billion over the medium term. These include savings associated with the early retirement programme, verification of social grants and the pause in the Human Settlements Development Grant.
While acknowledging the need for responsible expenditure management, the committees stressed the importance of protecting critical skills and frontline posts in health and education. They recommend that the National Treasury distinguish between savings arising from confirmed fraud and those resulting from other factors, including underspending and the cancellation of grants.
Municipal finances and infrastructure delivery
The financial sustainability of municipalities also featured prominently in the committees’ observations. While welcoming the additional R21.8 billion allocated to the local government equitable share to address increased bulk costs associated with providing free basic services, the committees remained concerned about unfunded municipal budgets, weak revenue collection, infrastructure grant underspending and growing municipal financial distress.
Of particular concern is the R27.6 billion owed to municipalities by other spheres of government and public bodies. The committees maintained that communities should not bear the financial consequences of non-payment by government institutions. They recommended that the National Treasury introduce enforcement measures and deadlines for recovering outstanding municipal debt from national departments and provincial governments, and report on progress in the February 2027 Budget.
Revenue collection and social protection
The committees also acknowledged that revenue projections for 2026/27 have improved by R54.1 billion compared with the 2026 Budget estimate. However, they noted warnings from the National Treasury and the PBO that some of the improved revenue performance, particularly that linked to commodity prices, may be temporary.
The reports welcomed the temporary fuel levy relief introduced to cushion households and businesses against higher oil prices. They also recommended that the National Treasury explore longer-term measures to address sustained fuel price increases, including diversifying fuel supply and restoring domestic refining capacity.
Furthermore, the committees urged SARS to intensify efforts to combat illicit trade, improve revenue collection and recover outstanding tax debt.
Justice Molafo
12 November 2026
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