Press Statement dated 12 November 2025
Issued by Zola Saphetha, National Education, Health and Allied Workers’ Union (Nehawu) General Secretary
The National Education, Health and Allied Workers’ Union [NEHAWU] notes the 2025 Medium Term Budget Policy Statement [MTBPS] as presented today in Parliament by the Minister of Finance, Enoch Godongwana, in conjunction with the tabling of the Division of Revenue Amendment Bill, Adjustment Appropriation Bill, Taxation Laws Amendment Bill and the Tax Administration Laws Amendment Bill.
The 2025 MTBPS is presented against the background of the persistent socioeconomic stagnation, underlined by the forecasted economic growth rate of 1.4% in 2025, on the back of an insignificant economic growth at an annual average rate of 0.7% over the past decade of sustained austerity measures.
Hence, overall unemployment rate remains elevated at a crisis proportion of about 12 million people or 43% of the workforce, more than two-thirds of whom are the country’s young people.
The current National Minimum Wage of R4,986 is below the basic household food basket estimated at R5,405 (which obviously excludes other basic household necessaries), which underlines the fact that the prevalent vast scale of poverty also impinges on the working people. The poor working people are additional to the estimated 30.4 million people who live on less than R1,634 per person per month (the upper-bound poverty line). So these are some of the acute socioeconomic realities that characterize the current concrete context against which the 2025 MTBPS was presented, and unfortunately on which there was a deafening silence in the minister’s statement.
Macroeconomic Policy
NEHAWU rejects the Treasury’s fiscal stance of growing the primary fiscal surplus, when it knows that the past decade of sustained budgetary cuts have devastated the capacity and capability of the public sector, including the provision of public services to the working class and rural poor, whilst seeking to draw additional spending through the dollar-denominated World Bank loans, of which this year alone amount to over R40 billion.
We note the announcement of a major policy shift in terms of the monetary policy, from an inflation-target range of between 3% and 6%, to a new inflation target of 3%, with “a 1% tolerance band”. This is accompanied by an announcement of the consideration of options for a formal fiscal anchor.
To begin with, as NEHAWU we have vehemently rejected any policy of inflation-targeting which is not balanced with the utilization of the monetary policy in pursuing the targeting of employment creation and economic growth rate.
Clearly, the introduction of an even lower and rigid inflation-target, which would be accompanied by a “formal” fiscal anchor policy, emphatically underlines the overall doubling-down with contractionary Neoliberal macroeconomic and overall Neoliberal economic policies, including the opening up of public infrastructure domains for private ownership by the seventh administration.
The envisaged introduction of a formal fiscal anchor is designed to consolidate the Treasury’s supremacy over Parliament by restricting its scope when considering the proposed budgets. On the one hand the Treasury announces this new inflation target without publishing any empirical studies supporting the merits of this new target and allowing for public comment, whilst on the other hand it disturbingly states that there are “short-term fiscal costs of a lower target, which include a lower nominal GDP and revenue growth”, which is an open admission of the contractionary nature of this new target. This can only spell future austerity measures and contractionary budgets.
NEHAWU shall continue to agitate against and oppose the consolidation of this Neoliberal state, and we hope that Parliament would once again stand up to the arrogant Treasury’s imposition of these policies that do not even carry the 2024 ANC’s electoral mandate, as it did with regard to the imposition of the VAT increase this year.
Public Service
NEHAWU notes with concern that the Treasury is now stating that "any future wage agreements beyond 2027/28 will have to be aligned with inflation.” In the first place, we have rejected the current public service wage agreement which merely keeps wage adjustments along the average annual inflation rate.
Indeed, we consider this throwaway statement in the 2025 MTBPS as part of the continuing anti-collective bargaining posture that started during the sixth administration, in which public servants were openly mugged R40 billion out of their pockets in 2021 alone.
This formal policy of seeking to align public service wage agreements with inflation rate appears to be part of the existing compensation spending anchor of keeping the public service wage bill below a third of the consolidated budget. Indeed, it smacks of another attempt to undermine collecting bargaining by linking it to inflation rate. Beyond our 13th Congress in 2026, we shall gear our organisation to sustain the fight and win against these continuing attacks on collective bargaining beyond 2027/28.
NEHAWU is extremely concerned that National Treasury is using the Targeted and Responsible Savings (TARS) initiative to further dismantle the public service and to restrict the social grant beneficiaries even more. Across the public service, there are vast number of vacancies which undermines the capacity of the public service in providing adequate services to the public, as during the past 10 years of self-defeating austerity measures these services have deteriorated.
We cannot permit National Treasury to invent yet another misleading acronym as a guise for underfunding public services and not filling vital vacancies. Many of the “non-performing programmes” are undermined by the under-staffing and lack of adequate resources due to austerity measures. Currently, there are 31,811 educator and 27,523 healthcare worker in unfilled vacancies, yet the Treasury continues with the Early Retirement Scheme, which unfortunately encourages the exodus of the most experienced and skilled public service personnel.
Social Protection
Whilst we welcome the extension of the COVID-19 Social Relief of Distress Grant (SRD Grant) by another financial year, the fact that the Treasury states that it is working on “proposals to link the working age population to skills development and employment programmes” represents a disgraceful avoidance of the ANC’s own mandate to establish a universal Basic Income Grant and the adoption of the discredited “job-seekers grant” of the Democratic Alliance. We consider this policy as an attempt to further reduce the beneficiaries of the SRD Grant, since the Treasury knows that in the current environment of deep-seated structural unemployment there are no employment opportunities for jobseekers, and such a scheme typically comes with financially wasteful and burdensome administrative bureaucracy to verify the job-seeking efforts of the unemployed.
We reject the "scaling down” of the Public Transport Network Grant (PTNG), which provides funding to selected municipalities for public transport infrastructure and the indirect costs of Bus Rapid Transit (BRT) services. The aim of this grant is to support the development of integrated, accessible, and affordable municipal public transport networks.
Public transport subsidies have been part of the budgetary items targeted for cuts over the past decade, which has contributed to the escalation of transport spending in working class households, in addition to the explosion of the costs of electricity by 68% and water by 50% over the last five years.
Post-school Education
NEHAWU notes that the Treasury continues with its policy of seeking to scale down allocations to the National Student Financial Aid Scheme (NSFAS). Despite the record National Senior Certificate (NSC) pass rate in 2025, the Treasury still allowed for massive shortfall of more than R12 billion for both universities and TVET colleges in the year 2025, amidst about R14 billion indebtedness of the NSFAS.
With regard to grants to universities, we note the fact that they have not been growing significantly to meet the growing demand, amidst the crises of accommodation and physical spaces for learning.
The budget for university education increased from R91.7 billion in 2024, to R96 billion in 2025 – and now it is planned to be at R100.4 billion in the 2026 academic year. In the current academic year, there has already been a R1.4 billion deficits on the budgets of universities as a cumulative effect of the rolling austerity measures of the past years.
The funds allocated for PSET will only grow by 4.6% over the medium term, which is not sufficient for the growing demand for higher learning. Without really increased investment, these shortfalls will continue to limit access for the poor and working class students, deepening social exclusion and undermining youth development.
Healthcare
Public healthcare is provisionally allocated R20.8 billion to cover compensation and essential services. This funding will facilitate the employment of 800 doctors who have finished their community service, safeguard about 4 700 health posts and address shortages in medical goods, services and accruals. All of these additional allocations are welcomed although this is at a reduce baseline due to past budgetary cuts in healthcare.
An additional R1.4 billion is earmarked for the construction of Siloam Hospital and the implementation of public-private partnership health technology at Tygerberg Hospital. We reject this Tygerberg Hospital public-private partnership. Nonetheless, we welcome the allocation of over R560 million to cover the shortfall in support of provincial HIV/ TB health services.
As NEHAWU we hold that any future announcement on the abolishment of the medical tax expenditure subsidies must be phased, beginning with top 10% in the income distribution and the wealthy. Together with the retirement insurance subsidies, these subsidies are discriminatory relics of the Apartheid system – in this case of healthcare they exclude the 84% majority of our people who have no access of private health insurance.
These resources, which would anyway be part of the mixed sources to fund the creation of the National Health Insurance must be ring-fenced for the upgrade of healthcare infrastructure, medical equipment and procurement of medicine and more importantly for the employment of clinical personnel and support staff in public hospitals and clinics.