Ramaphosa: debt has stabilised, now South Africans must feel it

President Cyril Ramaphosa says the improvement in South Africa’s public finances must now show up in the lives of South Africans, in better public services, infrastructure, jobs and less poverty.

Writing in his weekly newsletter to the nation on Monday, the President said the progress made in stabilising public debt and improving the country’s fiscal position must be matched by visible improvements. “Our job now is to turn financial stability into economic opportunity and a better quality of life for everyone,” he said.

His remarks follow Finance Minister Enoch Godongwana’s presentation of the Medium-Term Budget Policy Statement to Parliament last week, which set out progress in restoring the health of the public finances. This report is based on SAnews’s account of the newsletter rather than the full text, and the MTBPS figures below are as the President stated them.

Ramaphosa said decisions on how government raises, spends and manages public funds directly affect the quality of education, healthcare, infrastructure and the economy’s ability to create jobs, and he acknowledged that for many people the state of the public finances feels far removed from daily struggles.

“For the first time in nearly two decades, public debt has stabilised, and it is now beginning to decline. Since 2023, we have maintained a primary budget surplus, meaning that, excluding debt service costs, we have been spending less than we have been earning,” he said.

He explained that rising public debt had increased the cost of servicing it, diverting money that could otherwise have built schools and houses, equipped hospitals, maintained roads and delivered essential services. Government had been working to stabilise the finances while addressing poverty and unemployment, he said, following the effects of state capture and the COVID-19 pandemic on the economy.

According to the President, the improved fiscal position allows government to reduce debt, lower borrowing costs and strengthen confidence in the economy. He also acknowledged pressure on households from the rising cost of living, noting that the temporary reduction in the fuel levy announced by the Finance Minister was among the measures aimed at relief.

Ramaphosa placed the fiscal position inside what he called a “bigger economic recovery”, listing the end of load shedding, the improved fiscal position and the country’s removal from the Financial Action Task Force grey list as contributors to a rise in public confidence and the first sovereign credit rating upgrade in over 16 years. He said the South African Revenue Service’s recovery after the state capture era had enabled better collection rates, with the revenue service recording a historic R2.01 trillion net revenue collection in the 2025/26 financial year.

“This is revenue being used to deliver tangible benefits to the South African people as more resources are made available for social and development spending. It is being used to build more schools and clinics, improve public services, deliver social grants and invest in public infrastructure that communities rely on,” he stated.

He said restoring the finances was not only about raising revenue or cutting debt but about spending efficiently and accounting properly for public funds. Government is reviewing spending priorities, eliminating waste and inefficiencies, and phasing out programmes that perform poorly or lack clear outcomes. “More than R11 billion in savings has been identified in the medium term from rationalising low-priority programmes,” he said.

The President said those savings mean more spending on the social wage, which covers health, education, social development and services for low-income households and accounts for around 60% of non-interest spending. That funding, he said, supports free basic services for more than 11 million households, school meals and social grants for more than 18 million beneficiaries. The approach is targeted savings rather than indiscriminate cuts to departmental budgets, he said, so that more can go to social and development spending.

Government is also reviewing the Infrastructure Conditional Grant to establish why provinces and municipalities underspend, why projects are delayed or run over budget, and why the quality of completed projects is often poor. “Our aim is not to spend less but to spend smarter,” Ramaphosa said.

He said the improved fiscal position is creating room for more infrastructure investment, which he called essential for inclusive growth and job creation. “Payments for capital assets are the fastest-growing item in our budget, and new measures have been put in place to increase private sector investment in infrastructure,” he said. Additional funding is also being allocated to combat gender-based violence and femicide, including resources to employ more than 3 500 social workers and to strengthen forensic and investigative services so that cases are handled better and prosecutions and convictions are secured.

On the limits of the progress, the President was direct. “Unemployment is still far too high, too many families are struggling to get by and too many communities are dealing with poor services. We shouldn’t mistake financial stability for the end of the road. There is still a lot of work to do. But we should recognise how far we have come,” he said.

He said the MTBPS signals greater confidence and stability and demonstrates government’s commitment to recovery, investment, growth and job creation over the medium term, and that responsible financial management matters not only for attracting investment and weathering shocks but for protecting vulnerable South Africans.

“At the end of the day, that is what responsible management of public money is all about: not just a healthier balance sheet for the government, but a better life for the people of South Africa,” he said.

The question his newsletter leaves with the reader is the one it sets itself: whether the stabilised debt, the primary surplus and the R11 billion in identified savings reach the clinic, the classroom, the road and the household that are still waiting. The source document is SAnews (South African Government News Agency), at https://www.sanews.gov.za/south-africa/improved-public-finances-must-translate-improved-conditions-south-africans.