IEJ Statement - Budget 2025 and Fiscal Rules

The Institute for Economic Justice (IEJ) argues that proposed fiscal rules and continued budget cuts in South Africa's 2025 budget will undermine the Government of National Unity's (GNU) goals for inclusive growth and a 3% GDP growth target by 2027.

• The IEJ asserts that the President's target of 3% GDP growth by 2027 is unlikely to be achieved if the Minister of Finance continues budget cuts and focuses narrowly on debt stabilisation through a new fiscal rule.
• South Africa's debt trajectory is characterized by an accelerated rise in debt-to-GDP, increased interest rates on government debt, and a downgraded sovereign credit rating over the last decade, leading the National Treasury to implement expenditure cuts.
• The National Treasury achieved a primary budget surplus in 2024 through budget cuts to public infrastructure investment and the social wage, but the IEJ notes that the Treasury has not provided evidence of this strategy's impact on economic growth or conducted a human rights impact assessment.
• An IEJ policy brief concludes that fiscal rules are not a substitute for consensus-based budgeting, have mixed impacts with no proven causal relationship to debt outcomes, and that economic growth is more effective at improving debt dynamics than fiscal rules.
• The IEJ proposes six pillars for a sustainable fiscal path: maintaining social wage expenditure, cutting tax rebates for the wealthy and high-income earners, prioritizing state-led investment in social and economic infrastructure over the private sector, targeted spending in key economic sectors, and reviewing inefficient spending.

APA

Institute for Economic Justice (n.d.). IEJ Statement - Budget 2025 and Fiscal Rules. https://iej.org.za/wp-content/uploads/2025/02/IEJ-Statement-Budget-2025-and-Fiscal-Rules.pdf

Chicago

Institute for Economic Justice. IEJ Statement - Budget 2025 and Fiscal Rules. n.d. https://iej.org.za/wp-content/uploads/2025/02/IEJ-Statement-Budget-2025-and-Fiscal-Rules.pdf.

Wikipedia

{{cite press release |author=Institute for Economic Justice |title=IEJ Statement - Budget 2025 and Fiscal Rules |url=https://iej.org.za/wp-content/uploads/2025/02/IEJ-Statement-Budget-2025-and-Fiscal-Rules.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@misc{instituteforeconomicjusticendiej, author = {{Institute for Economic Justice}}, title = {{IEJ Statement - Budget 2025 and Fiscal Rules}}, publisher = {Institute for Economic Justice}, url = {https://iej.org.za/wp-content/uploads/2025/02/IEJ-Statement-Budget-2025-and-Fiscal-Rules.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }