Background

The Gauteng Provincial Government is re-tabling the 2025/2026 Budget amounting to R172.3 billion. In the previously tabled Budget, tabled on the 18^th of March 2025, we presented a provincial budget of R171.5 billion. This translates into an increase of R886.6 million. These additional resources were made possible through the provincial allocation of unspent funds and revenue over collection from the previous financial year.  

Two weeks ago, there were reports circulating in the media stating that the Gauteng Provincial Government had underspent by R1.8 billion, and that these underspent funds would be returned to the National Treasury. On the 12^th of May 2025, the Gauteng Provincial Treasury held a media briefing to address the concern that the underspent resources would no longer be available, or that they are lost by the Gauteng Provincial Government.  

We communicated that whatever funds could not be motivated would revert to the Provincial Revenue Fund and instructively, that these funds would remain available for re-allocation to programmes and projects, and that they were in no way lost by the Gauteng Provincial Government. The re-tabling of the provincial budget informed by the re-injection of the R886.6 million into the fiscus is confirmation of the truthfulness of the assertions that we made in the said media briefing.

The developments that inform the re-tabling of the Gauteng Provincial Government’s Budget were also occasioned by extraordinary events at National Government level which saw the postponement of the National Budget that was initially scheduled for the 22^nd of February 2025. The second attempt to table the national Budget was made on the 12^th of March 2025 but ended with the withdrawal of the Division of Revenue Bill on account of substantive disagreements with proposed revenue generation mechanisms.  

The Minister of Finance, Honourable Enoch Godongwana, eventually tabled the National Budget to Parliament on the 21^st of May 2025. The re-tabling of the national Budget by the Minister of Finance entailed amendments to the 2025 Fiscal Framework. The national

Budget also considered political and economic developments in the global arena. These developments precipitated a wave of unprecedented uncertainty worldwide, and certainly on the African continent where we are having to re-think development aid and re-engineer our approach to revenue generation.

It is on account of these developments that we had to write to the Speaker of the Gauteng Provincial Legislature to withdraw the Provincial Appropriation Bill for 2025/2026 that we introduced to the Legislature on the 18^th of March 2025. This was done so that we could re-table the Budget in compliance with Sections 26 and 27 of the Public Finance Management Act which instructs that the MEC responsible for Finance in a province must table the provincial budget for a financial year in a Provincial Legislature within a period of two weeks after the tabling of the national annual budget by the Minister of Finance.

ECONOMIC OUTLOOK OF SOUTH AFRICA AND THE GAUTENG PROVINCE

The International Monetary Fund projects that world economy will grow by 2.8 percent in 2025. This is largely because of uncertainties caused by the new US tariffs regime and retaliatory tariffs by other countries. On the domestic front, the National Treasury has downgraded its projection of the real Gross Domestic Product from 1.9 percent to 1.4 percent for 2025, due to adverse domestic and global developments. Our situation is compounded by the fact that the global economy is likely to provide less than ideal demand for South African exports. While it has largely stabilised following years of shocks from the COVID-19 pandemic to the effects of the Russo-Ukrainian war, it has stabilised at a relatively low growth rate.  

South Africa’s economic performance remained fragile in 2024. The real economic output of Gauteng, which makes up 33.8 percent of South Africa’s GDP, is R1.57 trillion, (nominal GDP is R2.43 trillion). Furthermore, GP’s real growth rate was 0.8 percent on an annual basis for 2024. The overall risks to the global economy and nationally are tilted to the downside, with the escalating trade measures prominent.

REBUILDING THE PROVINCIAL ECONOMY

The Gauteng Provincial Government has a five-year budget approach that will facilitate provincial delivery based on the Medium-Term Development Plan, strategic plans, and annual performance plans for the 7^th Administration. This approach is anchored on maintaining fiscal discipline and credibility, and impactful service delivery; responding to high-level provincial risks such as safety, economy, climate change and debt management; re-tabling of the 2025 Provincial Budget that is aligned with provincial strategic plans, annual performance plans, and other planning and budgeting engagements; and introducing, testing, and implementing immediate, short-term, and medium-term budget reforms over the 2025 Medium-Term Expenditure Framework. This is against the backdrop of a deteriorating fiscal position that is driven by declining revenue, mounting debt obligations, and an unsustainable wage bill.

To ensure that we reach and even surpass these targets, provincial departments are implementing various strategies to enhance revenue collection, anchored on our provincial Revenue Enhancement Strategy that is underpinned by the following five (5) principles:

1. Accelerating the completion of interventions that has already started.
2. Optimising the existing revenue sources.
3. Enhancing revenue collection processes and systems to increase efficiency, cost effectiveness, and eliminate leakages.
4. Identifying potential new revenue sources that have not been explored.
5. The use of alternative funding and implementation models to achieve more value.

GAUTENG INVESTMENT CONFERENCE

The Gauteng Investment Conference that we hosted in April 2025 successfully secured R312.5 billion in investment commitments across 60 projects, against a target of R300 billion that was initially set. The Investment Book presented at the Gauteng Investment Conference featured 117 projects across Gauteng’s economic corridors, totalling an estimated R239 billion in potential investment. These projects span key economic sectors including infrastructure, smart cities, agro-processing, manufacturing, automotive, ICT, and energy.  

The Investment Book offered investors a curated portfolio of initiatives at various stages of development, from concept to shovel-ready, providing critical insight into Gauteng’s development pipeline. Thus, the pledges secured mark a significant milestone toward the province’s R800 billion investment target over the next 5 years. These commitments span a wide array of sectors, geographies, and investor origins, illustrating Gauteng’s growing reputation as Africa’s investment epicentre.  

The Gauteng Provincial Government is working with various institutions, including the University of Pretoria’s Gordon Institute of Business Science (GIBS) to convert these pledges into projects, to ensure that what has been committed to the work of the government and the people of Gauteng materialises and facilitates the sustainable economic growth and development that we are pursuing.

THE 2025 MTEF BUDGET ALLOCATIONS AND RE-ALLOCATIONS

The budget allocations to departments for 2025/2026 financial year provided in this media statement are a quantitative summary and must be read alongside the re-tabled Budget Speech for a comprehensive outline of the qualitative value and rationale, as well as the departments’ areas of prioritisation. The re-allocations are as follows:

• In the 2025/2026 financial year, the Office of the Premier will receive an additional R50 million.
• The Gauteng Department of Economic Development will receive R100 million.
• The Gauteng Department of Human Settlements has been allocated R332 million.

• The Gauteng Department of Roads and Transport will be allocated R314.9 million

• For the Gauteng Department of Agriculture and Rural Development and the newly established Gauteng Department of Environment, R23.8 million and R18 million, respectively, are allocated.
• The Gauteng Department of Environment will also receive an additional R50 million.

The allocation of these additional funds demonstrates that the overall thrust of our budget approach remains the resourcing of critical social and economic programmes that are the basis of the social wage with our people, notwithstanding the increasingly challenging economic environment. Budgets for other departments remain unchanged over the Medium-Term Expenditure Framework, and are as follows:

• The Gauteng Provincial Legislature receives R1.2 billion in 2025/2026, and it grows to R3 billion over the MTEF period.
• The Gauteng Department of Health’s 2025/2026 financial year allocation amounts to R67.1 billion, and a total of R141.9 billion over the MTEF.
• In the 2025/2026 financial year, the Gauteng Department of Education receives R68 billion, and cumulatively R211.2 billion over the MTEF.
• The Gauteng Department of Social Development receives R5.4 billion for the 2025/2026 financial year, and R16.8 billion over the MTEF.
• The Gauteng Department of Cooperative Governance, Traditional Affairs and Urban Planning will be allocated R551.4 million in the 2025/2026 financial year and R1.7 billion over the MTEF.
• In the 2025/2026 financial year, the Gauteng Department of Community Safety will receive R2.4 billion, and R6.8 billion over the MTEF.
• The Gauteng Department of Sport, Arts, Culture and Recreation will receive an amount of R1 billion in the 2025/2026 financial year and R3.1 billion over the MTEF.
• The Gauteng Department of e-Government has been allocated an amount of R1.5 billion in the 2025/2026 financial year and R4.8 billion over the MTEF.
• The Gauteng Provincial Treasury will receive R787.8 million in the 2025/2026 financial year, and cumulatively R2.4 billion over the MTEF.
• The Gauteng Department of Infrastructure Development’s allocation for the 2025/2026 financial year amounts to R3.6 billion, and cumulatively R10.8 billion over the MTEF.

The 2025 MTEF Budget is characterised by compulsory baseline reductions across all Gauteng Provincial Government departments and entities, to accommodate the downward revision of the Provincial Equitable Share, and further baseline reductions to accommodate the provincial budget deficit. Despite the downward revision of budgets and reprioritisation within and between budget votes, the priorities highlighted in the State of the Province Address are funded in this 2025 MTEF Budget. We are confident that they will yield a measurable impact in delivering meaningful change for the people of Gauteng.

CONCLUSION

There must be no doubt, even in the face of challenges that we face, that Gauteng is still the economic nerve-centre of the regional economy. The challenges that we are confronted with are not insurmountable. The Gauteng Provincial Government will continue to prioritise the identification of efficiency gains and making trade-offs to fund government priorities. Fiscal discipline demands that the provincial and municipal governments maintain fiscal positions that are consistent with macroeconomic stability and sustained inclusive economic growth. Furthermore, provincial departments and entities must strengthen the exploration of alternative sources of funding to supplement the existing constrained revenue streams and thus enhance fiscal sustainability over the long-term. Public-private partnerships are going to be an anchor and vehicle to this approach and must be pursued committedly.

Gauteng Provincial Treasury

 

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