The 2026 Medium-Term Budget Policy Statement (MTBPS) has confirmed a concern TLU SA has repeatedly raised: Government continues to spend substantial amounts of taxpayers’ money without consistently achieving the intended results.
Finance Minister Enoch Godongwana acknowledged today that, despite R887 billion being transferred through infrastructure conditional grants between 2017/18 and 2023/24, projects have frequently been delayed, left incomplete or failed to deliver their intended benefits. This admission raises serious questions about the effectiveness of government spending and the accountability of those responsible for managing public funds. “For years, we have been asking what actually happens to taxpayers’ money. The Minister has now acknowledged that substantial infrastructure funding has been spent without delivering the intended results. The question is why this was allowed to continue and what consequences there will be for those responsible,” says Bennie van Zyl, General Manager of TLU SA.
Although the Minister announced improvements in fiscal stability, including a projected budget deficit of 3.9% of GDP for 2026/27, the economic outlook remains concerning. Government has revised its growth forecast for 2026 downwards from 1.6% to 1.2%. According to TLU SA, this is simply insufficient to address South Africa’s unemployment, poverty and growing dependence on public finances. Sustainable economic growth requires an environment in which businesses can invest, expand and create employment. This includes policy certainty, the protection of private property rights, functioning infrastructure and an effective security environment.
“Government cannot keep referring to economic growth as a priority while the conditions necessary for growth remain inadequate. Entrepreneurs and farmers create economic value when they can operate profitably and with confidence. That confidence cannot be created through budget announcements alone,” says Van Zyl.
TLU SA welcomes the Minister’s announcement of temporary fuel levy relief, particularly the reduction of R3 per litre on diesel from 4 November to 1 December, followed by a reduced concession until 5 January 2027. This will provide some relief to agricultural producers who are already facing considerable increases in production and transport costs. However, the organisation cautions that temporary relief cannot compensate for years of deteriorating infrastructure, inefficient logistics and rising operating expenses. Commercial farmers are largely price takers and cannot simply pass every additional cost on to consumers.
The additional R1.5 billion announced over three years for agricultural extension officers is also noted. TLU SA believes that the value of this expenditure must be measured against the actual support delivered to producers. The speech provides no specific new allocation for critical concerns such as foot-and-mouth disease control or rural safety.
Similarly, the additional R810 million announced for the South African Police Service vehicle fleet must be assessed against improvements in operational policing, including the protection of farming communities.
Of particular concern is the announcement of an additional R21.8 billion for local government to meet rising basic service costs. The Minister acknowledged that many municipalities spend excessively on operating costs, leaving insufficient resources for infrastructure investment and maintenance. “More money will not solve a management problem. If municipalities cannot maintain roads, provide reliable water and electricity or manage their existing resources properly, additional funding will mean very little unless the underlying problems are corrected. Farmers and other businesses are already paying the price for these failures,” says Van Zyl.
TLU SA acknowledges the proposed reforms to public and municipal financial management legislation, as well as the identification of a further R38.1 billion in potential savings through more efficient spending and the reduction of fraud and waste. These are necessary steps, but their success will ultimately depend on effective implementation and consequences for financial misconduct. The organisation calls for transparent, measurable reporting on government-funded projects, including whether projects were completed, whether procurement processes were lawful and competitive, and whether the intended economic and social benefits were achieved. Where expenditure has failed to deliver results, the reasons must be investigated and corrective action taken. “The Minister has acknowledged that government needs to spend better, not simply spend more. We agree. But acknowledging the problem is only the beginning. Taxpayers need evidence that money is being managed responsibly, that competent people are making the decisions and that those who waste public funds are held accountable.”
Van Zyl concludes that South Africa cannot afford to continue measuring government performance by the size of budget allocations. “Every rand spent must contribute towards a functioning country and a growing economy. Agriculture needs reliable infrastructure, safety and an economic environment in which producers can remain profitable. Ultimately, the success of this budget will be determined not by what was announced today, but by what actually changes on the ground.”
