SA’s R12 Billion In Savings Identified Through TARS Programme

This according to Finance Minister Enoch Godongwana who delivered the 2026 Budget Speech in Parliament on Wednesday.

“[In] the Budget last May, we promised that spending priorities would not be funded through tax increases if this could be avoided. We have kept that promise, through our commitment to finding savings from unproductive expenditure, closing leakages, and rooting out inefficiencies.

“I am happy to announce that R12 billion in savings have been identified over the medium term,” Godongwana said.

He emphasised that the TARS are not once off initiative and will be entrenched going forward.
“They will be an ongoing and entrenched part of the budget process going forward to weed out inefficiencies and low-performing programmes.

“Every programme and every allocation must demonstrate value, efficiency and accountability,” he said.
Savings were realised in the Public Transport Network Grant which has been scaled down by some R8.4 billion, over the next three years.

“The grant has not improved access to public transport relative to the investments made. The grant will, however, continue to help cover indirect costs in cities that run bus services,” the Minister said.

Social grants were also earmarked as a potential savings target.

“Enhanced targeting of social grants authentication of beneficiaries to reduce fraud in the grant system will yield R3 billion of savings. The South African Social Security Agency has upgraded its biometric and income verification processes, resulting in nearly 35 000 grants being identified as incorrect or fraudulent, and therefore terminated.

“Honourable Members, we are committed to improving access for the many South Africans deserving and eligible for social support. Abuse of the system will not be tolerated,” Godongwana said.

The judiciary, border management, defence and Statistics South Africa will be allocated the remaining savings.

In the 2026 Budget Review, National Treasury highlighted that TARS is part of efforts to “rationalise the operations of the state, improve the effectiveness of service delivery, eliminate waste, address underperformance and reduce duplication.”

“Consultations across government ministries and departments are under way to conclude each change and identify further savings.

“In most cases government is reallocating or shifting savings to priority areas or spending pressures, for example within the transport sector, thus removing the need for additional allocations,” Treasury explained.

Anchoring sustainable public finances

The National Treasury announced that in consultation with Cabinet, it will “undertake detailed analytical work to prepare legislation to anchor sound fiscal principles in law”.

The move is aimed at entrenching commitment to healthy public finances.

“To build confidence and maintain the gains of fiscal consolidation without resorting to painful spending cuts or tax increases, the National Treasury will propose a principles-based obligation to anchor fiscal sustainability in law.

“It will require each new government to table a plan to ensure that the fiscal position is sustainable throughout its term of office and that an appropriate fiscal metric is selected to measure compliance.

“[The plan is] an essential element in the provision of health, education, water, shelter and other socioeconomic rights in line with the Constitution. Without sustainable public finances debt-service costs will consume ever more of the economy’s available resources, eroding investment, productive capacity and living standards,” Treasury said.

The approach, Treasury explained, is also aimed at avoiding unsustainable practises that are “damaging” to national development.

“In particular, the proposal is informed by recent experience. Since 2008/09, government’s debt ratio has more than tripled. Debt-service costs have risen from 8.8 per cent of revenue to 21.3 per cent in 2025/26, crowding out other spending. It has taken a large-scale consolidation effort to rein in debt for the benefit of all South Africans,” said Treasury.

A consultation paper will be published outlining proposals with an announcement expected to be made later this year in the Medium-Term Budget Policy Statement. – SAnews.gov.za