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22 April 2025 | Story Terrance Molobela | Photo Supplied
Terrance Molobela
Terrance Molobela is a Lecturer in the UFS Department of Public Administration and Management.

Opinion article by Terrance Molobela, Lecturer in the Department of Public Administration and Management, University of the Free State.

 


 

Despite fierce opposition of the already passed National Fiscal Framework, the African National Congress (ANC) convened several meetings within and outside the Government of National Unity (GNU) mostly pioneered by its Secretary-General Fikile Mbalula who recently stated: “We are not trickers; we do not trick people. We engaged with ActionSA, and they said they do not want VAT; that’s not tricking anyone.”

One thing is clear, there is nothing binding on the GNU that after receiving additional budget proposals to raise revenue from ActionSA and Building One South Africa (BOSA), the VAT hike will be dropped. In fact, on 16 April 2025 in an interview with Newzroom Afrika the Minister of Finance Enoch Godongwana said: “I am not married to any increase or percentages”. The minister pointed out that the initial budget without VAT hikes was still on the table, however, he further highlighted that VAT increases remain Parliamentary policy issues. His advice is: “If you remove the 0.5% VAT increase, you must find an equivalent amount on the expenditure side to ensure the fiscal framework remains balanced.”

As the budget impasse stands, people need to understand that once the budget is passed by Parliament, the minister cannot unilaterally reverse the VAT increase. This is cemented by Section 12 of the Public Finance Management Act and Section 7(4) of the VAT Act. This ball is in Parliament’s court to reverse the budget and revenue proposal once alternative revenue generation proposal have been brought forward.

With 1 May 2025 looming, South Africans have a bitter pill to swallow as they will be charged R15.50% for every R100 spent. The media covered the VAT increase with rage and concerns from various communities across the country. The people feel punished by the GNU, while facing deep-rooted socio-economic problems like inequality, high unemployment, and poverty.

Despite the GNU deadlock and its fiscal crisis, several members within the ANC have unanimously admitted that the party has grossly failed to reach an amicable consensus within the GNU to freely support the VAT hike, hence it is vehemently opposed from all sides. Some critics suggest that the ANC-led government is poised to drop the VAT hike, but it’s unclear as to where and how the minister of finance would find the money to plug the fiscal gap.

 

Marriage may be sweet, but divorce is bitter

Both the ANC and DA knew ahead of time that forming the GNU with other parties was what is commonly known as “a marriage of inconvenience”. Before and on the wedding day, you both blind yourselves because of the sweet cake, joy, guests, and presents that long-lost friends will bring along. You create this beautiful picture that only exists in your head and hope that the other party shares a similar picture. But after you have entered the marriage, you then realise that you each functions on different levels and do not have complementary ideologies.

The DA’s ideologies on governance and policy is far the opposite of the ANC, and although it could work, the ANC have demonstrated their thirst for power and control, hence, their ability to share power equally remains a foreign language. DA leader John Steenhuisen has made it clear that they will not sacrifice citizens’ votes for a piece of cake but would rather fight and support a budget that caters for economic growth and job creation. This they have demonstrated by challenging the legality of the budget process in court, with hopes of blocking the implementation of a VAT increase, which has led to widening the rift within the fragile GNU.

 

The authenticity of the parliament – flawed budget process?

Amid mounting tensions created by the budget impasse, the National Assembly narrowly facilitated the national budget process, the DA, Economic Freedom Fighters (EFF), and uMkhonto weSizwe (MK) party rejected the budget, whilst the ANC-led government through coalescing outside GNU with parties like Action SA, secured majority support for the approval of the fiscal framework.

Parliament passed the 2025 National Fiscal Framework without the formal amendment of the mounting VAT and tax hikes. This was approved without binding recommendations, although budget committees suggested that the VAT and tax hikes be reconsidered at a later stage. As 1 May 2025 approaches for the VAT hike to kick in, reversing the VAT increase would be a lengthy process because it appears untenable.

The DA leader raised concerns that the Finance Committee acted ultra vires of the standing rules of Parliament, meaning the budget was not properly presented to the committee to reject or approve it, and that only a single proposal from the ANC was prioritised, whilst neglecting the DA proposal. This legal anomaly occurred under the watch of the National Assembly on the 2 April 2025. Hence, the DA have been challenging the budget.

One would ponder – “if the tables were turned, and the DA was in the position of the ANC and visa-versa, would the National Assembly opted to approve the budget framework?” I guess we would never know.

 

Where does the road lead now?

GNU: the ANC has already held several talks and meetings indirectly citing that the DA should hand over their divorce papers. But the president of the ANC needs the DA to remain in the coalition because of further economic shocks, which saw R1 trillion wiped out on the Johannesburg Stock Exchange (JSE). Investor confidence in the economy has hit rock-bottom, and the current trade wars have put pressure on multiple businesses to tighten their investment belts until it is safe to continue investing. The DA has not yet declared whether they want a divorce, but critics suggest that the Deputy President, Paul Mashatile, would be delighted if the DA left since they rejected the very same budget that they expect to reap from. As for ActionSA, it is unclear whether they have decided to join the GNU, but its leader Herman Mashaba has shown interest in joining the GNU, which most critics have weighed as a betrayal to the people of South Africa.

Ordinary citizens: It is time for South Africa’s citizens to brace themselves for the oncoming VAT hike. As much as the minister of finance has argued that it was necessary to stretch the already deeply embedded financial distress of citizens grappling with over-taxation of income, the bitter pill remains theirs to swallow. The 0.5% in VAT carries an underestimated distress for households who will be left alone to deal with increased prices of goods, services, and essentials.

 

What should be done thus far?

More tax on the people, goods and services kills jobs, which results in reducing revenue generation by government. To avoid further inflationary hikes, the government needs to approach the problem in an unusual way – this means placing strict rules and regulations on any government transaction that takes effect, deal with corruption and mismanagement at every sphere of government. Monies lost and stolen through unfinished projects should be recovered and ensuring that all state projects remain frequently monitored.

The government needs to change its ways of approaching industries, companies, and businesses to create jobs, and transfer some of their skills to the people of South Africa. The youth is yearning to be seen, supported, trained, and placed into the real world to unleash their potential, which might be something the economy needs to re-establish and position itself in the right direction to stir desired economic growth.

 

News Archive

Graduates encouraged to use their knowledge to the benefit of SA
2017-06-28

Description: Graduation read more photo 27 June 2017 Tags: Graduation read more photo 27 June 2017

On 26 June 2017, the last day of its mid-year graduation
ceremonies, the University of the Free State conferred
388 master’s and 72 doctoral degrees.
Photo: Charl Devenish

You have the knowledge, which is a big resource, and should use it to the benefit of South Africa. This was the overwhelming message to graduates obtaining their master’s and doctoral degrees at the University of the Free State (UFS).

Their responsibility was emphasised by the likes of Justice Mahube Molemela during the ceremonies in the Callie Human Centre at the Bloemfontein Campus on 26 June 2017. Justice Molemela, Judge President of the Free State Division of the High Court and Acting Justice of the Supreme Court of South Africa, was the guest speaker at the morning and afternoon ceremonies.

The UFS conferred 388 master’s and 72 doctoral degrees on the final day of its mid-year graduation ceremonies, which was the biggest set of ceremonies in the university’s history. The doctorates came from the Faculty of Natural and Agricultural Sciences (30), Faculty of the Humanities (15), Faculty of Economic and Management Sciences (9), Faculty of Education (8), Faculty of Health Sciences (5), and Faculty of Theology (5). A total of 5 258 degrees were conferred over six days from 19 to 26 June 2017.

Future dependant on youth

Justice Molemela said the master’s and doctoral graduates have the skills to make a difference. “The future of a nation is largely dependent on its youth playing a meaningful role in creating a strong economy, culminating in a good standard of living for everyone.”

She said they should plough back into their communities and give opportunities to others. “I am certain that if each one of you thinks innovatively in your respective fields, you will find solutions which will eradicate poverty, improve service delivery, and hence our education will advance gender equity, and promote public participation.”

Dr Khotso Mokhele, UFS Chancellor, said these graduates have every reason to hold their heads high, their shoulders square, and walk with a bit of an attitude, as they have distinguished themselves.

Generation of new knowledge
According to Prof Francis Petersen, Rector and Vice-Chancellor, the UFS strives to be a university that is research led. “For me, one of the important aspects about universities which set them apart from other training and vocational institutions is the generation of new knowledge,” he said at a lunch function for PhD graduates on 26 June 2017. He feels it is critically important for them to make a contribution to the country.

Dipiloane Phutsisi, Principal and Chief Executive Officer of the Motheo TVET College in the Free State, also emphasised this. Phutsisi was the guest speaker on 23 June 2017. “Your courage and eagerness to face the future and tell the truth in the midst of this confusion, is highly desired by South Africans.”

Justice Ian van der Merwe, Judge of Appeal at the Supreme Court of Appeal and former Chair of the UFS Council, was the guest speaker at the ceremonies on 22 June 2017. He encouraged graduates from a chapter in the book War and Peace by Leo Tolstoy.

“There is no greatness where there is not simplicity, goodness, and truth (according to Tolstoy). Or maybe more modernly translated: There is no greatness where simplicity, goodness, and truth are absent.”

Click here to see a list of Deans’ and Senate medals awarded.

Graduations ceremonies:

 

19 June 2017:

Faculty of Education, except educational qualifications in Open and Distance Learning – South Campus
Faculty of Health Sciences, Faculty of Theology, and Faculty of Law (including the School of Financial Planning Law)

Description: Bloem Campus Graduation 19 June 2017 Tags: Bloem Campus Graduation 19 June 2017

 

“Every one of us, is destined for greatness. In the words of Dr Martin Luther King: Everyone has the power for greatness, not for fame but greatness, because greatness is determined by service.” – Dipiloane Phutsisi (Guest speaker and Principal and Chief Executive Officer of the Motheo TVET College in the Free State)

 
Photo Gallery
Livestream Footage (morning session)
Livestream Footage (afternoon session)

Photo: Charl Devenish



20 June 2017:

Faculty of Natural and Agricultural Sciences: All Bachelor’s degrees
Faculty of Natural and Agricultural Sciences: All Diplomas and Bachelor Honours degrees

 Description: Mid-year graduation day 2, Bloemfontein Campus Tags: Mid-year graduation day 2, Bloemfontein Campus

 

“Graduation marks a start of a new and wonderful journey. During the last couple of years you have not only developed your intellect, but also expanded what I call your social self,” - Prof Francis Petersen, Rector and Vice-Chancellor

Speech: Prof Francis Petersen (morning)
Speech: Prof Francis Petersen (afternoon)
Photo Gallery

Livestream Footage (morning session)

Livestream Footage (afternoon session)

Photo: Charl Devenish



21 June 2017:

Faculty of Economic and Management Sciences: All certificates, diplomas, Bachelor’s degrees, and Bachelor Honours degrees, excluding BCom degrees
Faculty of the Humanities: Social Sciences and Communication Sciences only

 Description: Mid-year Graduation 21 June 2017 read more Tags: Mid-year Graduation 21 June 2017 read more

 
“Graduation is one of the most accomplished achievements one can ever experience.” – Justice Connie Mocumie (Guest speaker and Judge of Appeal at the Supreme Court of Appeal)

Photo Gallery
Livestream Footage (morning session)
Livestream Footage (afternoon session)

Photo: Charl Devenish

 

 



22 June 2017:

Faculty of Economic and Management Sciences: BCom degrees only
Faculty of the Humanities: All qualifications, except Social Sciences and Communication Sciences

 Description: Mid-year graduation read more for 22 June 2017 Tags: Mid-year graduation read more for 22 June 2017

 

“The question is not if you will make mistakes, but how do you deal with your mistakes? Do you admit them, do you learn from them, and do you grow as a person?” – Justice Ian van der Merwe (Guest speaker and Judge of Appeal at the Supreme Court of Appeal)

Photo Gallery
Livestream Footage (morning session)
Livestream Footage (afternoon session)

Photo: Johan Roux

 



23 June 2017:

Educational qualifications in Open and Distance Learning – South Campus

 Description: Mid-year graduation 23 June 2017 Tags: Mid-year graduation 23 June 2017

 

“Class of 2017, go and make your own unique contributions but remember to look into your own heart. South Africa needs your skills, your innovation, knowledge, your expertise and creativity.” – Dipiloane Phutsisi (Guest speaker and Principal and Chief Executive Officer of the Motheo TVET College in the Free State)



Photo Gallery

Livestream Footage (afternoon session)

Photo: Charl Devenish


 

26 June 2017:

All faculties: master’s and doctoral degrees

 Description: Graduation read more block 26 June 2017 Tags: Graduation read more block 26 June 2017

 

“Class of 2016/2017 graduates: You are critical thinkers, you can analyze, you can think independently. That is why you managed to successfully complete postgraduate degrees and diplomas.” – Justice Mahube Molemela (Judge President of the Free State Division of the High Court and Acting Justice of the Supreme Court of South Africa)


Photo Gallery
Livestream Footage (morning session)

Livestream Footage (afternoon session)

Photo: Charl Devenish


 

 

 

 

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