Finance Minister Enoch Godongwana has officially tabled the 2025 “Budget 3.0” in Parliament, introducing key adjustments aimed at stabilising South Africa’s economy and fostering growth. This revised budget follows the rejection of two earlier proposals and incorporates input from various stakeholders, including opposition parties.
Speaking on PM Drive, North-West University economist Professor Raymond Parsons unpacked the implications of the latest budget, urging the public to manage expectations.
“We’ve had months of fairly robust debate, both within and outside Parliament, about what the budget should look like,” said Parsons. “We need to maintain realistic expectations. The Minister wasn’t working from a clean slate—both the February and second proposals were rejected. Valuable feedback, including the opposition to a VAT increase, left him with limited fiscal options.”
Parsons pointed out that while there is consensus on the overarching goals of the budget, contention lies in the methods of achieving them. “Everyone, including opposition parties, agreed we should avoid additional borrowing, or at least keep it minimal. Still, it sends a worrying signal. Something had to be funded, and with a VAT hike ruled out, the only significant tax adjustment is the fuel levy.”
Meanwhile, the Automobile Association (AA) has criticised the fuel levy increase, warning of its negative impact on consumers. Effective 4 June, the general fuel levy will rise by 16 cents per litre for petrol and 15 cents for diesel—the first increase in three years.
AA spokesperson Eleanor Mavimbela said the hike would drive up transport costs, elevate food prices, and place further strain on already struggling households. The AA has called for a forensic audit into the use of fuel levy revenues.
Listen to the full interview below:
VOC News
Photo: Screenshot
