Budget delay a humiliation, but not the end of the GNU, says political analyst

Johannesburg - The postponement of the 2025 Budget Speech to 12 March has raised critical questions about South Africa’s economic trajectory and governance under the Government of National Unity (GNU).

Renowned political journalist, commentator, and best-selling author, Justice Malala, unpacked these concerns in the latest PSG Think Big webinar, hosted by award-winning journalist Alishia Seckam. The series is aimed at promoting open dialogue and stimulating critical conversation on some of the country’s most pressing issues. Malala described the delay as a failure in political management, warning that South Africa cannot afford missteps of this scale.

The conversation focused on the need for a budget to set the tone for economic direction, yet the pace of reform has not matched the post-election optimism around the GNU. “The key missing piece is a GNU medium-term policy statement outlining how this coalition will work together to achieve real progress.”

According to Malala, this budget was the GNU’s opportunity to outline fundamental reforms to restore economic health. He pointed out that in 2008, our debt-to-GDP ratio was 23.9%. “We are now at around 75%. It is a major thing: how are we going to plug this hole?”

Malala was critical of the fiscal measures being considered, including the widely debated 2% VAT increase. He said that beyond taxation, there is a need for a stronger focus on economic growth through structural reforms.

Another central issue remains government spending. “We don’t necessarily spend too much; we just don’t spend effectively,” Malala noted. “Capital spending is not prioritised, and the recent public sector wage bill has created further financial pressure without a clear way out.”

Turning to global trade, Malala raised concerns about South Africa’s strained relationship with the US and the risk of losing benefits under the African Growth and Opportunity Act (AGOA). “South Africa has been on the backfoot, particularly given that we went a significant period without an ambassador in Washington. When AGOA comes up for review in September 2025, we need to be prepared for potential changes,” said Malala.

Looking ahead, Malala offered a balanced perspective on the GNU’s future. “It’s important to remember that this is a coalition government – it’s going to have bumps, it’s not going to be smooth sailing.” He explained that this budget delay isn’t the coalition’s first crisis, nor will it be its last. “A few weeks ago it was the Expropriation Act, before that was the BELA Bill, and before that NHI.”

For Malala the question is therefore not whether the GNU will collapse, but whether it will learn from these challenges and improve governance. “The GNU will continue but real work needs to be done if we are to reap the fruit of this relationship,” he concluded.