ActionSA has notified the ANC that it will not support the national budget.
The party’s move raises the prospects of the fiscal framework, which includes the government’s spending and revenue generation proposals, failing to pass by the April 2 deadline.
If the budget does stand up to scrutiny in parliament, it would mark the first time in SA’s democratic history that the national budget has failed to secure MPs’ approval — a reflection of the altered political landscape stemming from the loss of the ANC’s electoral majority in last year’s polls.
ActionSA, which holds six seats in the National Assembly, made its decision after a meeting with the ANC negotiating team last Friday. It is one of several parties rejecting the budget.
The DA, MK and EFF have also voiced their opposition, leaving the ANC in parliament, led by chief whip Mdumiseni Ntuli, with limited options to secure the necessary votes.
VAT increase
At the heart of ActionSA’s refusal to vote for the budget is the 0.5 percentage point increase in VAT tabled by finance minister Enoch Godongwana on March 12.
In correspondence with the ANC, ActionSA national chair Michael Beaumont said the ANC had failed to adequately consult before Godongwana tabled it in parliament.
“In our letter to the ANC, ActionSA conveyed the view that the proposed increases in both VAT and income tax (through income tax bracket creep) cannot be supported for a government that has failed to address its own considerable wastage and inefficiencies,” Beaumont said in a statement on Tuesday.
“Central to our decision is the reality that this budget arises from a GNU [government of national unity] that did not consult ActionSA in the development of the proposed budget.
“ActionSA cannot impose tax increases on South Africans to support those in the GNU who are notionally opposed to these increases, yet continue implementing them at the expense of South Africans.”
The budget approval process requires the consideration and passage of several key bills by the National Assembly and the National Council of Provinces (NCOP).
This includes the fiscal framework, the Division of Revenue Bill, the Appropriation Bill, the Rates and Monetary Amounts Bill and the VAT Amendment Act.
The legislation must first be reviewed by relevant committees before being voted on by the National Assembly and NCOP.
The National Assembly is due to meet to consider the 2025 fiscal framework proposals and the report from the standing committee of finance, which is holding public hearings on the budget.
The standing committee’s report includes proposals for budget amendments, which are then taken to the National Assembly. The NCOP is also due to meet on April 2 to consider the standing committee’s report.
If parliament has not passed the budget by April 1, the Public Finance Management Act, the cornerstone of SA’s financial management, provides a fallback, allowing government spending to continue based on the previous year’s budget allocations.
The GNU comprises the ANC, DA, Rise Mzansi, Al Jama-ah, IFP, Patriotic Alliance (PA), GOOD, the Pan Africanist Congress (PAC), Freedom Front Plus (FF+) and the UDM.
These parties represent 70% of the seats in the National Assembly.
Without the DA, which has 87 seats in the National Assembly and is the second-largest party in the coalition government, the budget is unlikely to receive enough votes to pass, unless the GNU looks outside for support.
The Sunday Times reported at the weekend that the ANC has held meetings with the EFF to secure its support to get the budget over the line.
Rise Mzansi, which has two seats in the National Assembly, said it would study the budget in detail before making a final decision.
“The important work of parliament’s committees has begun — the National Assembly will on April 2 consider the 2025 fiscal framework and revenue proposals and the report of the standing committee on finance thereon,” said the party’s Mabine Seabe. “There is also still the work of committees dealing with department and entity budgets in detail — almost line-by-line.
“These budget votes (about 40 of them) will be debated on through the month of May.
“The Appropriation Bill and budget votes will only be voted on in the National Assembly on June 10,” Seabe said.
Update: March 25 2025
This story has been updated with new information.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.