Frank Blackmore, Lead Economist at KPMG South Africa; Jurgen Eckmann, Wealth Manager at Consult by Momentum; Nkosinathi Mahlangu, Youth Employment & Entrepreneurship Specialist at the Momentum Group Foundation; Tando Ngibe, Senior Manager, Budget Insurance; Hayley Parry, Money Coach and Facilitator at 1Life’s Truth About Money

 

Frank Blackmore, Lead Economist at KPMG South Africa

 

I think the expectation for this year’s SONA was that the gap between the lived reality of most South Africans and the high-level themes addressed by the President needed to narrow more than it has in previous years. In this regard, I believe this SONA deserves a positive assessment.

 

The first major focus area the President addressed was crime – including corruption, syndicates, gang violence and illegal mining. He went into considerable detail, ranging from creating an environment that is safer and more conducive to community wellbeing, such as improved street lighting and strengthened social services, to placing more boots on the ground. He also outlined specific actions aimed at strengthening institutions such as the SIU, the NPA and the Hawks, as well as reforms to the whistleblower framework. I believe this would have been well received by most South Africans, given the current state of safety and security in the country, as highlighted by the ongoing Madlanga Commission and the parliamentary inquiry.

 

The second key issue raised was water; specifically, the inadequate and often inaccessible supply that has become commonplace across many municipalities. The President referred to increased funding for water infrastructure, as well as the establishment of a National Water Agency and a National Water Crisis Committee. These new oversight structures were presented as solutions. While this can be viewed positively, there is also a critical perspective, which I will address later.

 

Thirdly, the President focused on local government reform, strengthening municipal finances, improving skills, ensuring proper staffing and enhancing accountability. He referred back to last year’s commitment to an updated White Paper and suggested a revised operating model for municipalities. Economic growth was also central to much of the speech, encompassing infrastructure development, increased investment, innovative funding mechanisms and sectoral interventions in areas such as agriculture and mining to stimulate growth.

 

He also touched on additional areas including education, technology, tourism, healthcare, small businesses and BEE, suggesting a broad and comprehensive policy agenda.

 

However, if I were to offer criticism, it would be this: approximately 90% of the address focused on decades of basic service delivery failures within government. While acknowledging these failures is important, the proposed solution often appears to involve establishing additional layers of government – new committees, oversight bodies and agencies – rather than fixing the departments directly responsible for delivery and oversight.

 

This approach arguably increases the size and cost of government while diluting accountability. It raises the question: who is ultimately accountable, the Minister of Water or the head of a newly formed water action committee? Furthermore, resources that could be directed towards frontline service delivery risk being absorbed into administrative structures.

 

A more effective approach, in my view, would be to streamline government and clearly define departmental responsibilities. While the President suggested that external experts could be brought into these new structures, departments themselves could convene focused task meetings on infrastructure, maintenance, development or expansion and invite academics and industry experts to contribute where necessary.

 

Instead, we risk expanding the size and cost of government while reducing direct accountability. Ultimately, what South Africans need is consistent basic service delivery from existing departments, alongside accountability at the appropriate levels of government. That, perhaps, is the key takeaway from this address.

 

Jurgen Eckmann, Wealth Manager at Consult by Momentum

 

President Ramaphosa’s address points to a macro environment that is more stable than it has been in several years – you could feel the positivity in the room, which was very encouraging after the more gloomy addresses from years’ past. Four consecutive quarters of GDP growth, easing inflation and declining interest rates provide welcome relief for households under pressure. For consumers, that creates some breathing room but it also requires sound financial decisions rather than complacency.

 

A stronger rand and improved performance on the JSE mean investors should reassess how much of their portfolios sit offshore versus locally. Many South Africans increased offshore exposure during periods of uncertainty. With local fundamentals stabilising, it may be time to revisit asset allocation and rebalance where appropriate.

 

Energy reform is another key shift. With loadshedding largely behind us and restructuring under way, sectors that were previously constrained by unreliable electricity may recover more sustainably. That has implications for local equities, business expansion and even residential and commercial property values.

 

At the same time, the water crisis introduces a new and very real financial consideration. Infrastructure quality and municipal governance will increasingly influence property risk and long-term investment decisions, which is something to pay attention to.

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On the fiscal front, while primary budget surpluses and improved revenue collection are positive, broad tax relief is unlikely in the near term. Consumers should expect continued compliance scrutiny and plan cash flow carefully. The cost of living crisis is not disappearing yet.

 

The renewed focus on crime and enforcement also matters economically, hopefully positively affecting insurance premiums, business confidence and ultimately household stability.

 

Overall, there are encouraging green shoots emerging. But stronger macro indicators do not remove the need for proactive financial planning.

 

Nkosinathi Mahlangu, Youth Employment & Entrepreneurship Specialist at the Momentum Group Foundation

 

This year’s SONA puts welcome emphasis on growth, infrastructure and skills reform. The scale of planned infrastructure investment, the expansion of youth employment programmes, and the proposed overhaul of the skills development system are all important steps in the right direction.

 

But growth figures alone do not guarantee that young people will find work. We need to be more deliberate about how opportunity is structured. Large infrastructure and rail projects need to create entry-level jobs in the very communities where they are implemented. The shift toward a training model that combines classroom learning with practical workplace experience is a positive development. Strengthening TVET colleges as primary sites for artisan and occupational training is equally encouraging, particularly if these institutions are properly resourced and closely linked to industry demand. The real test will be whether this translates into structured work experience and clear pathways into sustainable employment once young people complete their studies.

 

The inclusion of agriculture as a priority growth sector is particularly significant. Agriculture holds real potential for youth employment, but we need clear processes that enable small-scale and emerging farmers to participate meaningfully and scale their operations. This is critical not only for job creation, but also for reducing our reliance on external trade arrangements such as AGOA.

 

The foot-and-mouth disease outbreak has hit commercial farmers hard, but its impact on small-scale and young farmers is often more devastating. Urgent and equitable access to vaccines will be essential to protect livelihoods and sustain youth participation in the sector.

 

The focus now must be on measurable outcomes that ensure young South Africans are not left behind.

 

Tando Ngibe, Senior Manager, Budget Insurance

 

From a household perspective, I believe most South Africans are less concerned with GDP growth statistics and more focused on whether there is money left at the end of the month. While lower inflation and easing interest rates are encouraging signs, many families remain under pressure from high food prices, transport costs and rising municipal charges.

 

For me, one of the most important elements of the address was the focus on commuter rail and affordable housing. Transport is one of the biggest monthly expenses in most household budgets. If rail services become more reliable and affordable, that could significantly reduce transport costs for working families. Even modest savings in this area can free up money for essentials such as groceries, school expenses and maintaining insurance cover.

 

When it comes to water infrastructure and local government reform, consumers are currently absorbing the cost of inefficiency. Water outages and infrastructure failures are not just inconvenient — they are expensive. Households often have to buy bottled water, install storage tanks or repair property damage linked to service disruptions. If municipalities become more accountable and efficient, that will have a direct and measurable impact on household finances.

 

Employment, however, remains the single biggest factor in improving financial wellbeing. In my view, job creation is what ultimately restores consumer confidence. When more South Africans — particularly young people — are employed, households become less reliant on debt and social grants. Stable income allows families to budget properly, save consistently and plan for the future.

 

I also note the intention to amend credit regulations to make access to finance easier. While this could assist households managing short-term pressure, I would caution that increased access to credit must be matched with responsible borrowing and strong financial education. Over-indebtedness remains a serious concern, and credit should support stability — not undermine it.

 

Ultimately, consumers will judge progress by lived experience. Do they feel safer? Are services more reliable? Are monthly expenses more predictable? Financial resilience is built on stability — steady employment, manageable debt, affordable transport and consistent service delivery. That is what will make the real difference in the everyday lives of South Africans.

 

Hayley Parry, Money Coach and Facilitator at 1Life’s Truth About Money

 

For many South Africans listening to the State of the Nation Address, this may have been the most energetic and optimistic the President has sounded in years — determined to build on gains made after state capture, Covid, floods and unrest.

 

But for households under pressure, the question isn’t about tone. It’s about traction.

 

Despite easing interest rates, moderating inflation and a resilient JSE, many consumers are not feeling relief. In my work as a money coach, I see it daily: whatever marginal gains households make are quickly absorbed by the rising cost of compensating for failing service delivery. For years, South Africans who could afford it had to make alternative plans for electricity, security and private healthcare. Now it’s water. These are no longer discretionary upgrades — they are parallel systems households are forced to fund themselves.

 

And those costs are quietly eroding financial resilience.

 

The reality is that households are being forced to budget not just for living expenses, but for system failures. That fundamentally changes how we think about emergency funds, savings rates and long-term financial planning. Families are trying to build stability on shifting ground. For many, it feels less like recovery and more like running to stand still.

 

This is where the upcoming Budget becomes critical.

 

Over the past few years, income tax brackets have not always been fully adjusted in line with inflation. Even when adjustments are made, they often fall short of real cost-of-living increases. The result is bracket creep — where taxpayers move into higher tax brackets due to nominal salary increases that simply keep pace with inflation, not real wealth creation. For middle-income earners in particular, this has meant steadily shrinking disposable income at a time when household costs are rising.

 

At the same time, the annual Tax-Free Savings Account limit remains at R36,000 per year, with a lifetime cap of R500,000 — thresholds that have not meaningfully shifted in years. While these instruments are powerful, their real value erodes over time if not adjusted for inflation.

 

Retirement contributions remain deductible at up to 27.5% of taxable income (capped at R350,000 annually). For higher earners this cap has also remained static, limiting the effectiveness of retirement savings as a tax-efficient resilience tool.

 

If we want consumers to save more, invest more, and participate confidently in the economy, then policy needs to create room for them to do so.

 

Meaningful consumer-focused relief could include:

• Proper inflation-aligned tax bracket adjustments to prevent further bracket creep
• Indexed increases to TFSA annual and lifetime limits
• Review and inflation alignment of retirement savings deductibility caps
• Consideration of targeted relief for households that are effectively self-provisioning essential services

 

Relief cannot only exist in macroeconomic indicators — it must be felt in monthly budgets.

 

Until then, households will continue to stretch, absorb, and self-fund — often at the expense of long-term financial security.

 

ENDS