The Budget Battle: Who Will Pay the Political Price?
With the initial hysteria over the budget fading, the pressing question now is whether it will pass.
The budget must clear the Standing Committee on Finance in the National Assembly (NA) and the Select Committee on Finance in the National Council of Provinces (NCOP) before reaching both Houses for debate and a vote. The African National Congress (ANC) lacks a majority in both these committees and on the parliamentary floor, making the outcome uncertain.
The Democratic Alliance (DA) has firmly opposed the VAT increase and has stated it will not support the budget. However, as a member of the Government of National Unity (GNU), it is bound by the coalition’s Statement of Intent, which outlines the legislative approval process:
All parties must have the opportunity to express their views.
If no consensus is reached despite reasonable attempts, the bill can proceed if parties holding at least 60% of National Assembly seats within the GNU support it.
Any dissenting party must have the opportunity to formally record its objections.
For the budget to pass within the GNU framework, parties controlling at least 60% of National Assembly seats must support it. However, passage in Parliament requires a majority vote (201 votes). The budget is not a single document but a series of budget-related bills, including the Fiscal Framework and Revenue Proposals, the Division of Revenue Bill, and the Appropriation Bill, each requiring approval.
Parliamentary Seat Breakdown:
African National Congress (ANC): 159 seats (40.18%)
Democratic Alliance (DA): 87 seats (21.8%)
Umkhonto we Sizwe (MK): 58 seats (14.59%)
Economic Freedom Fighters (EFF): 39 seats (9.52%)
Inkatha Freedom Party (IFP): 17 seats (3.85%)
Patriotic Alliance (PA): 8 seats (2.05%)
Freedom Front Plus (FF+): 6 seats (1.36%)
Action SA: 6 seats (1.19%)
African Christian Democratic Party (ACDP): 3 seats (0.6%)
United Democratic Movement (UDM): 3 seats (0.49%)
Rise Mzansi: 2 seats (0.42%)
Build One SA (BOSA): 2 seats (0.41%)
African Transformation Movement (ATM): 2 seats (0.4%)
Aljama: 2 seats (0.24%)
Cape Coloured Congress (CCC): 2 seats (0.23%)
Pan Africanist Congress (PAC): 1 seat (0.23%)
United Africans Transformation (UAT): 1 seat (0.22%)
GOOD: 1 seat (0.18%)
Total GNU seats: 286 | Total non-GNU seats: 113
If the budget is not passed by 1 April, the Public Finance Management Act (PFMA) allows government spending to continue based on the previous year’s allocations. This means the budget can only pass with support from either the DA, MK, or the EFF.
The Political Calculations
MK:
MK will not support the VAT increase. Their voter base would see it as a betrayal, and politically, they stand to gain nothing from backing the ANC. The ANC, under Ramaphosa, will not form a coalition with MK, as doing so would undermine his faction internally. Without a governance incentive, MK has no reason to cooperate.
EFF:
The EFF has been considered the most likely party to push the budget over the line. However, much like MK, selling a VAT increase to their voter base would be politically costly. The EFF would demand governance concessions in return, yet the ANC cannot afford to accommodate them without alienating the DA. The DA has already stated that allowing the EFF into the GNU would destabilise the government and weaken Ramaphosa’s faction, though not as dramatically as an MK alliance would.
That said, the EFF is in a different strategic position. Unlike MK, its popularity is declining. Supporting the budget could serve as a calculated power move—both to assert influence over the ANC and to undercut the DA’s position within the GNU. If the EFF secures a phased VAT increase of 0.5 percentage points over two years (0.25 each year), they could sell it as a victory, claiming they mitigated the tax hike while simultaneously undermining the DA.
DA:
Ultimately, the ANC and DA are likely to reach a compromise. The DA miscalculated during GNU negotiations, failing to secure enough influence and becoming a de facto ANC ally. But the ANC needs the DA just as much as the DA needs the ANC.
There is a common narrative now being sold that the DA will not leave the GNU because they enjoy the perks of governance. While there may be some truth to this, the deeper issue is that the DA lacks a viable alternative. The opposition landscape has shifted drastically; what was once a contest between the ANC as the singular enemy for opposition parties has become a crowded space where 10 GNU members compete for dominance, while 8 non-partners compete for relevance. The simple truth is the DA can no longer monopolise opposition politics.
Governance provides the DA with a platform to showcase capabilities. Returning to opposition would mean obscurity in an oversaturated, highly competitive field. Unlike the EFF or MK, the DA does not rely heavily on theatrics—its political style does not lend itself to populist stunts, which are needed to stand out in the current climate. Given that a 50+1 majority is unattainable for the DA in the near future, it would rather work with the ANC than gamble on an uncertain opposition strategy.
The ANC’s Strategy
Despite speculation about GNU negotiations, it is my belief that the ANC always intended to align with the DA. An MK alliance was never viable, and the EFF was considered but ultimately dismissed due to irreconcilable ideological differences. The ANC’s preference was to govern with the IFP as a minor partner and the DA as a stabilising force. The “GNU” was a post-facto branding exercise to legitimise this arrangement. In the end, the ANC outmanoeuvred the DA during the negotiations.
If the budget does not pass, the ANC and DA will still have to find a way forward. Potential compromises could involve concessions on the National Health Insurance (NHI) Bill or the Land Expropriation Act. The Basic Education Laws Amendment (BELA) Bill lacks the significance to serve as a bargaining chip. The DA’s biggest challenge will be justifying to its voters why it initially opposed the VAT increase but later backed a modified version. The most politically viable option would be securing a VAT increase of 0.5 points over a single financial year, coupled with ANC policy concessions and a review of the VAT increase later on.
The DA has threatened to leave the GNU, but the ANC is calling its bluff. The coalition remains fragile, yet beyond the political wrangling, the real issue should be its impact on ordinary South Africans. The VAT increase dominates headlines because it is the most immediately felt change, but it is merely a symptom of a deeper economic crisis. South Africa’s problem is not the Finance Minister’s budget—it is an economy that has stagnated.
To win the budget battle, parties must look beyond VAT debates and address economic growth across government. The challenge is not just passing the budget; it is ensuring South Africa’s limited resources are managed effectively. That is the real issue at stake.