KZN Finance MEC Backs 2026 Budget’s Debt Stabilisation Plan

Speaking after Finance Minister Enoch Godongwana tabled the Budget in Parliament on Wednesday, Rodgers praised the strong focus on fiscal discipline and debt stabilisation.

KwaZulu-Natal Finance MEC Francois Rodgers has welcomed the 2026 National Budget, describing it as a decisive move to restore South Africa’s financial credibility while cautioning that provinces need greater support to sustain frontline services.

Speaking after Finance Minister Enoch Godongwana tabled the Budget in Parliament on Wednesday, Rodgers praised the strong focus on fiscal discipline and debt stabilisation.

Debt to Stabilise at 78.9% of GDP

According to the 2026 Budget, public debt is projected to stabilise at 78.9% of GDP in 2025/26 before gradually declining over the medium term.

The budget deficit is expected to narrow to 4.5% of GDP, with further reductions projected to reach 2.9% by 2028/29.

Rodgers said this trajectory signals responsible financial management.

“It is encouraging that the country is taking debt seriously. Every rand saved on interest is a rand that can be redirected to critical service delivery,” he said.

He added that stabilising public finances is essential not only to protect future generations from unsustainable debt burdens but also to create an environment conducive to economic growth and investor confidence.

Tax Relief for Small Businesses Welcomed

The MEC also welcomed measures aimed at supporting small enterprises — a key driver of job creation.

Key tax relief measures announced include:

• An increase in the VAT registration threshold from R1 million to R2.3 million

• An increase in the Capital Gains Tax (CGT) exemption on the sale of a small business from R1.8 million to R2.7 million

Rodgers said these adjustments could ease compliance costs and encourage entrepreneurship.

Concern Over Pressure on Provincial Services

Despite supporting the overall fiscal direction, Rodgers raised concerns about limited relief for provincial frontline departments such as Health, Education and Social Development.

“In KZN, equitable cuts from National Treasury amount close to R80 billion over the past nine years. This is amid increases in expenditure items,” he said.

He warned that sustained reductions in the equitable share allocation have placed significant strain on provincial budgets, particularly as wage bills and service delivery demands continue to rise.

Call to Tax Online Gambling

Rodgers also called on National Treasury to accelerate plans to tax online gambling, describing it as a potential new revenue stream that could support service delivery.

He argued that regulating and taxing the rapidly growing online betting sector would help broaden the tax base without placing additional pressure on already stretched taxpayers.

Balancing Discipline and Delivery

The MEC’s response reflects the broader tension between fiscal consolidation at national level and mounting service delivery pressures at provincial level.

While the 2026 Budget prioritises debt stabilisation and deficit reduction, provincial governments continue to seek additional fiscal space to fund healthcare, education and social welfare programmes.

Rodgers said that long-term financial stability must go hand in hand with sustained support for frontline services to ensure inclusive growth and improved living conditions.