2023 Medium-term Budget Policy Statement Review

National Treasury (NT) tabled a credible MTBPS, which was largely in line with our expectations.

The medium-term fiscal strategy remains intact, focusing on a two-pronged approach to supporting SA fiscal health via: 1) stabilising the debt burden; and 2) keeping the composition of spending broadly in line with existing policy by incorporating a large social wage component (61% of spending over the Medium-Term Expenditure Framework) which continues to support vulnerable households.

NT continues to forecast a primary surplus over the medium-term, a key component for debt stabilization. A primary surplus requires realising revenue receipts in excess of non-interest expenditure.

NT was conservative with its macroeconomic assumptions, lending credibility to the budget estimates.