MTBPS update: positive budget to keep SA in upwards credit rating cycle
21 October 2026
2026’s Medium–Term Budget Policy Statement saw debt ratios revised higher, similar ratios for the fiscal deficit and an upwards revision to revenue.
Mid-term Budget Speech 2026
Finance Minister Enoch Godongwana presented South Africa’s 2026 mini budget, that supports the case for further credit upgrades.
LISTEN: MTBPS 2026 | More revenue, less borrowing?
In this episode of No Ordinary Wednesday, Investec's Annabel Bishop and Tertia Jacobs join Jeremy Maggs to discuss the fiscal choices facing South Africa, the risks to government revenue and expenditure, and what the mini-budget could mean for borrowing costs and investor confidence.
Investec’s Budget experts
2026 Budget Speech: Key takeaways and analysis
Finance Minister Enoch Godongwana delivered South Africa's 2026 National Budget on 25 February, outlining government's fiscal plans, economic growth expectations, tax measures and spending priorities.
Explore the key announcements and Investec's analysis of the February Budget, which provides important context for the October 2026 Medium-Term Budget Policy Statement.
- Debt stabilisation: Government expects debt to stabilise in 2025/26 for the first time in 17 years, with deficits and debt-service costs declining.
- Modest growth recovery: GDP growth forecast at 1.6% in 2026, rising to 2% by 2028, despite infrastructure and logistics constraints.
- Tax relief: Stronger revenue enables the withdrawal of R20bn in proposed tax increases, personal income tax relief and higher savings and VAT thresholds.
- Infrastructure investment: Over R1 trillion allocated to public infrastructure, supported by energy, logistics and municipal reforms.
- Social spending: Higher social grants and continued social spending priorities, supported by targeted savings rather than broad tax increases.
Watch: Budget Speech 2026 preview
Listen: Budget 2026 | What’s at stake?
South Africa’s 2026 Budget arrives at a pivotal moment. Debt is hovering near 78% of GDP. Growth is forecast at just 1.5%. Debt-servicing costs absorb around 5% of GDP. And yet, bond yields have fallen, sentiment has improved and S&P maintains a positive outlook. Is this genuine fiscal stabilisation or simply a window of opportunity? Listen to Investec experts Chief Economist Annabel Bishop and Treasury Economist Tertia Jacobs unpack the upcoming budget.
In-depth analysis
A view from Investec's Chief Investment Strategist
Talking on his podcast, Macro Monday, Chris Holdsworth gave a short Budget Speech preview:
There are a couple of data points worth highlighting, for one, we think that total government revenue will be just a bit above the Medium Term Budget Policy Statement (MTBPS) forecast, which was about R20 billion above the budget last year, forecast.
So there's an extra R20 billion relative to the budget, and that means we don't expect to see the same sort of fight around the VAT increase that we saw last year.
The second point to look at is when debt-to-GDP peaks. Now in the MTBPS forecast, debt-to-GDP was due to peak around now, and even if that gets pushed out a little, by say six months or so, and it's expected to peak in the next year., we think that would still be a very encouraging development for rating agencies.
Should it be the case that the Treasury or Finance Minister presents a trajectory which sees that debt-to-GDP has either peaked already or is going to peak in the very near term, that would still allow scope for further rating upgrades by the backend of the year.
This page will be updated with analysis as the Budget Speech unfolds.
Get all Investec's Budget Speech insights delivered to your inbox
Explore more:
Looking for previous Budget commentary?
Explore Investec’s 2025 Budget coverage.
Watch Investec experts' media interviews
CNBC Africa: South Africa’s tough 2025 budget plan
Investec Chief Economist Annabel Bishop unpacks the key considerations for Budget Speech.
Budget 2.0 | Expectations ahead of Godongwana’s address
Investec Treasury Economist Tertia Jacobs spoke to ENCA about her expectations for Budget Speech saying: "The key issue is that the government allocates spending towards current spending that would be like compensation on goods and services and a component that goes into infrastructure.”
2025 Budget Speech expectations for VAT and job creation
In this Business Talk with Michael Avery interview, Tertia Jacobs, Investec Treasury Economist, discusses South Africa’s 2025 budget and the prospect of a R58 billion shortfall.
Key topics
You may also be interested in:
Wealth Management
We work with some of South Africa’s most successful individuals and
families to preserve and grow their wealth. Let us do the same for you.
Corporate Finance and Advisory
We are a leading corporate house with an international presence. Our sound advice across sectors will help you grow your business.
Private banking
For a single, monthly fee, the Private Bank Account offers you day-to-day transactional banking, a complimentary rewards programme, travel benefits, Investec Digital and access to an online trading platform.
Wealth Management
We work with some of South Africa’s most successful individuals and
families to preserve and grow their wealth. Let us do the same for you.
Corporate Finance and Advisory
We are a leading corporate house with an international presence. Our sound advice across sectors will help you grow your business.
Private banking
For a single, monthly fee, the Private Bank Account offers you day-to-day transactional banking, a complimentary rewards programme, travel benefits, Investec Digital and access to an online trading platform.
Browse further in