Overview
- The government formalised a 3% inflation target with a ±1 percentage‑point band, a coordinated move with the Reserve Bank intended to anchor expectations and lower borrowing costs over time.
- Treasury cautioned that the shift will reduce nominal GDP and revenue in the near term and worsen the debt ratio initially, with growth still subdued at a 1.2% forecast for 2025 and about 1.8% over the medium term.
- Public debt is now projected to stabilise in 2025/26 at 77.9% of GDP, debt‑service costs are R4.8 billion lower this year, and their growth is trimmed to 3.8% annually, with the primary surplus set to rise.
- A R19.3 billion revenue overrun allows roughly R15.8 billion in additional spending this year, while a conditional R20 billion tax package is pencilled in for 2026 if SARS misses collection targets.
- Transparency and anti‑fraud steps include a new Procurement Payments Dashboard and a payroll audit that flagged 8,854 high‑risk cases for verification.