Rising Debt, Inefficiencies Are Draining South Africas Fiscus, Finance Committees Say

South Africas high debt and inefficient expenditure have been flagged as key issues driving the country towards a financial crisis, committees in parliaments finance cluster said during a pre-budget briefing on Monday.

Minister of Finance Enoch Godongwana is due to present the budget to parliament on Wednesday after he was unable to do so on 19 February when the government of national unity failed to agree on the proposed increase in VAT from 15 to 17 to boost revenue.

On Monday, a visibly frustrated Songezo Zibi, chairperson of the standing committee on public accounts, told journalists that the countrys debt and borrowing costs kept rising, but the nation had nothing to show for it, adding that money had been misused to the detriment of social services, including hospitals and schools.

Zibi, leader of the Rise Mzansi party, noted that the governments debt in the 2023-24 financial year stood at R5.26 trillion, up from R1.79 trillion 10 years ago. Measured in inflation-adjusted terms, the burden of public debt per working-age individual increased to R114 974 in the financial year from R70 074 a decade prior.

During this decade of economic underperformance, real GDP per person fell from R80 046 to R74 599, underscoring how economic stagnation intensified pressure on households and the broader economy, Zibi said.