Finance Minister Enoch Godongwana.
Image: Independent Newspapers
By Dimakatso John Manthosi and Thato Lekaowa
The 2024 National Elections gave South Africa a repeat of history. It is also critical to note that this repeat of history is a consequence of the failures of the African National Congress (ANC) leading up to the 2024 national elections.
The current composition of government being the Government of National Unity (GNU) is not a clarion call out of satisfaction from the electorate of the Republic of South Africa. It is a clarion call out of deep-seated dissatisfaction with what was supposed to be their liberators. Perhaps former President Nelson Mandela had foresight on what was to happen in the democratic project when he said: “If the ANC does to you what the Apartheid government did to you, then you must do to the ANC what you did to the Apartheid government” in the Cosatu conference in 1993. Hence, the people of South Africa yielded the call of the former president and did to the ANC what they thought at the time was impossible.
Thus, a history lesson for the current GNU is of utmost importance to the socio economic development of South Africa, its people, and the upholding of their constitutional rights. Thus, the first lesson of note is after a period of negotiations between the apartheid government and the ANC in the Convention for a Democratic South Africa (CODESA). The democratic project took off through means of a Government of National Unity from 1994-96. Which was a short-lived composition of government as its collapse in 1996 can be attributed to firstly Ideological difference. The African National Congress (ANC) transformative agenda did not align with what was instituted by the National Party (NP) from 1948 through apartheid. Perhaps it is also critical to note that the only successful coalition government in the history of South Africa is the coalition of 1910 with the formation of the Union of South Africa between the Boers and the English. This was due to the shared vision they had post the Anglo Boer war.
The second was the decline in support for the NP and thirdly loss of influence as key decisions were driven by the ANC and the NP felt that the party only has little real power within the GNU to shape policies despite holding some ministerial positions. Thus, the project of a successful government of national unity collapsed in 1996. Therefore, it becomes critical when making a diagnosis on the current government to note similar symptoms of the GNU in 1994-96 to better understand how the budget postponement was an inevitable crisis for the government. In the past 8 months the GNU government has struggled to have Bill, the Basic Education Laws Amendment Bill and most recently the Expropriation Bill. Surprisingly the GNU showed little to no symptoms of tensions with the State of the Nation Address (SONA). From a critical analysis perspective if SONA couldn’t induce symptoms of deep-seated tension within the GNU, inevitably the Budget Speech was the breaking point as the 30 year rule of the ANC was to be challenged along with the policies passed in the past 8 months because this was to be the enabling factor of the implementation and continuity of what the ANC has dominated in for years.
The passing of the National Health Insurance (NHI) Bill, the Basic Education Laws Amendment (BELA) Bill, and the Expropriation Bill directly align with the three key differences that contributed to the collapse of the first Government of National Unity (GNU) in 1994-96: ideological differences, decline in party support for opposing parties, and loss of influence in shaping policies. For example, the Expropriation Bill, aimed at redistributing land without compensation in certain cases, is another deeply ideological policy that reflects the ANC’s historical stance on land reform from 1912, creating friction within the GNU as parties like the DA and other business-aligned factions oppose state-led land redistribution. These ideological clashes create the same tensions that led to the failure of the first GNU, making cohesion in governance an uphill battle.
Ultimately, the combination of ideological divisions, the decline in DA support due to their inability to prevent ANC-led policies and other parties in the GNU, and the ANC’s dominance in shaping policy mirrors the historical failures of the first GNU, casting doubt on the sustainability of the current coalition from opposition parties such as the Economic Freedom Fighters (EFF). The passing of these bills highlights the power struggles within the GNU, where opposing parties feel sidelined despite holding ministerial positions such as the minister of education who was voluntarily absence for the signing of the BELA Bill into law. Without a unifying vision that bridges ideological gaps and ensures meaningful participation from all parties, the government risks falling into the same pattern of dysfunction that led to the collapse of the 1994-96 GNU. If history is any indicator, the current government may face a similar fate if it cannot navigate these deep-seated differences effectively. The unfortunate part is that the ordinary South African can not afford what seems to be the two inevitable consequences. The first being a collapse of the current GNU and the second being a continuation without resolving their differences. Furthermore, the implementation of the National Health Insurance (NHI) Bill, the Basic Education Laws Amendment (BELA) Bill, and the Expropriation Bill imposes a significant financial burden on the public purse, creating tension in priority spending within the GNU.
Now understanding the challenges presented to the GNU another element of those challenges is the contextualisation of how to drive more revenue for the functioning of government. Thus, understanding revenue mobilisation through the South African Revenue Service (SARS) remains a key strategy to fund these ambitious policies and the workings of government in the presence of cohesion. SARS employs various tax collection methods, including corporate income tax, personal income tax, customs duties, and excise taxes. However, inefficiencies in tax collection, loopholes in enforcement, and widespread tax evasion hinder the government’s ability to maximize revenue. SARS has attempted to improve compliance through digital systems, audits, and investigations into illicit financial flows, but challenges persist. Another strategy has been the expansion of tax brackets and increasing tax rates, particularly targeting high-income earners and businesses. However, this approach risks discouraging investment and driving capital flight. A more effective revenue mobilisation strategy would focus on strengthening SARS through better technology, increased workforce capacity, and stricter enforcement mechanisms to ensure that all eligible taxpayers contribute fairly to the national budget.
While Value Added Tax (VAT) is often proposed as a way to increase revenue, it is an ineffective and regressive strategy that disproportionately affects the poor. Raising VAT increases the cost of essential goods and services, exacerbating economic inequality and placing a heavier burden on low-income households. Instead of relying on VAT hikes, the government should focus on enhancing SARS’ capacity to collect taxes more efficiently by closing tax loopholes, curbing illicit financial flows, and improving enforcement against tax evasion. Strengthening SARS would ensure that businesses and high-net-worth individuals meet their tax obligations, thereby increasing government revenue without further burdening the poor. In this way, the government can secure sustainable funding for its ambitious policy agenda while maintaining fairness in taxation and protecting vulnerable communities from undue financial strain.
* Dimakatso Manthosi – An advocate for social, political and legal justice. He has previously served as spokesperson for MOVE South Africa and as a researcher, policy analyst and parliamentary researcher for RISE Mzansi.
* Thato Lekaowa – An International Relations graduate from the University of Pretoria, passionate about policy analysis, sustainable development, and diplomatic relations. With leadership and administrative experience she has honed skills in stakeholder management, event coordination, and financial oversight. As a Peer Counsellor and Mentor, she committed to community development and empowerment. She seeks opportunities to drive impactful change through research, policy, and global engagement.
** The views expressed do not necessarily reflect the views of IOL or Independent Media.