This comes amid mounting financial strain on households and pressure for reforms to spur economic growth.

Economist at Anchor Capital, Casey Sprake, speaking to Channel Africa on Tuesday, said the Minister should present clear plans for identifying and phasing out underperforming or low-priority government programmes to reduce expenditure and reallocate funds toward national priorities.

Sprake says economists are also seeking clarity on whether the National Treasury supports the SA Reserve Bank’s (SARB) proposed shift to a lower inflation target of 3%, which could influence future interest rate decisions.

She notes that fiscal discipline will be a key theme this year, following delays in budget adoption and spending patterns distorted by political uncertainty earlier in the year.

“For us, prioritising the strengthening of infrastructure investment is vital to unlocking SA’s long-term growth potential,” Sprake said. “If we get the spending priorities in the right places, particularly in energy and transport, we can really get the economy moving again.”

Sprake added that scaling up private sector participation in infrastructure delivery will be crucial for driving investment and job creation, especially as youth unemployment remains “uncontrollably high.”

On the potential implications of a lower inflation target, she said the move could limit interest rate cuts in the short term but help stabilise prices and improve the long-term economic outlook.

“The Reserve Bank has done well to anchor inflation expectations around 4.5%, but lowering the target further will be a challenge given South Africa’s structural constraints,” she said. “Still, keeping inflation under control remains vital because higher prices hurt lower-income households the most.”

–ChannelAfrica–