Statement by the Young Communist League of South Africa (YCLSA)
14 March 2024
Introduction
The Young Communist League of South Africa (YCLSA) unequivocally rejects the 2025 Budget tabled by the Minister of Finance under the Government of Neoliberal Unity as a Fiscal Disgrace. What was presented on Wednesday is not a “balanced fiscal strategy” It is in contrast a blueprint for deepening inequality, the commercialization of public wealth, and safeguarding corporate profits at the direct expense of the youth, working class and the vulnerable impoverished masses who were hoping for a people’s budget.
Before the initial budget collapsed in Cape Town, the YCLSA had already warned that the state would present a market-driven budget designed to appease capital while leaving the majority of South Africans in worsening poverty, unemployment, and economic exclusion. Our worst fears have now been confirmed: the state has fully surrendered to neoliberal austerity, abandoning the National Democratic Revolution and betraying the aspirations of the people it claims to serve. Rather than dismantling the legacy of apartheid, this budget entrenches systemic exploitation, forcing workers, students, and the unemployed to pay for the failures of capitalism.
The neoliberal agenda of this budget is not as a result of prevailing conditions, it is a deliberate choice taken by those who run the fiscus to place the interests of the markets over the people, profits over livelihoods, and corporations over communities.
VAT Increase: A Blatant Attack on the Poor
The planned VAT increase to 16% by 2027 is an outright assault on the working class. Currently, the poorest 55% of households already spend most of their income on VAT-heavy essentials, compared to just 4% for the rich. The National Treasury’s response of adding organ meats and canned vegetables to the list of VAT-free items is an insensitive cruel joke as statistics show that 43% of people in South Africa cannot afford a basic nutritional diet. Meanwhile, the corporate tax rate remains untouched at 28%, even though South Africa loses more than R150 billion annually to tax evasion and illicit financial flows. The poor must once again foot the bill for the ineffectiveness of the liberals who are managing the fiscus.
This policy approach is similar to what was seen during apartheid, where indirect taxes like VAT disproportionately impacted Black working-class communities, who were already trapped in exploitative labour systems and spatial segregation. In contrast to South Africa, countries like China have implemented progressive tax policies that ensure the wealthy contribute their fair share while exempting working-class households from indirect taxation on essential goods. South Africa must follow this example and shift the tax burden away from the poor and onto the capitalist elite.
Higher Education Funding
The R53 billion allocated to NSFAS is meaningless when the majority of students remain trapped in exploitative private housing, forced to pay up to R4,500 per month for substandard living conditions. Instead of ensuring accessible and affordable education, the government has left students at the mercy of private landlords and profiteers. A truly transformative education budget would place public investments in student housing and infrastructure, rather than outsourcing it to the private sector.
Meanwhile, the cost of learning materials remains unaffordable, with VAT on textbooks and stationery still in place, this adds a further burden to students who already struggle to afford basic academic necessities. The ongoing collapse of PRASA’s rail system has made matters worse, forcing students to spend nearly 40% of their income on unsafe and unreliable transport, deepening their financial struggles.
In Russia, our BRICS partner, 90% of student housing is provided by state-owned universities at subsidized rates, demonstrating that education can and should be a public good rather than a profit-driven enterprise. In contrast, South Africa has allowed private landlords to exploit students, charging exorbitant rents while offering substandard living conditions. Instead of ensuring safe, affordable, and accessible student accommodation, the state has abandoned its responsibility, forcing students into financial hardship while exacerbating their mental distress.
The YCLSA demands that NSFAS take full control of student housing, alongside the full subsidization of educational materials and urgent state-led intervention to restore affordable and reliable public transport for students.
Youth Unemployment: The Death Sentence of a Generation
South Africa’s youth unemployment crisis is one of the worst in the world, yet the budget offers no real solutions. Instead, the GNU relies on superficial job creation schemes while ignoring the structural causes of unemployment: Today, unemployment stands at a staggering 63.4% nationally, with provinces like the Eastern Cape (71.2%) and KwaZulu-Natal (68.9%) suffering even worse conditions The youth of South Africa are not just statistics in economic reports; they are a generation abandoned by a government that refuses to confront the failures of capitalism. With over 60% of young people unemployed, this is not just a crisis but a national emergency that threatens social stability and the future of our country. Instead of implementing bold, state-led interventions to create sustainable employment, the government continues to outsource job creation to the private sector, which has consistently failed to absorb young workers into the economy.
The myth that the free market will resolve the unemployment crisis has been exposed time and time again. Even though it’s clear that the markets will not save us from unemployment, the Department of National Treasury remains committed to the neoliberal policies that leave millions without work or hope. A genuine solution to youth unemployment requires a decisive break from the current economic trajectory by implementing socialist fiscal policies and development pathways.
In summary: Godongwana is Reviving the Spirit of GEAR
The 2025 budget presented by Godongwana is nothing more than GEAR 2.0, a continuation of the disastrous Growth, Employment, and Redistribution policy that condemned millions to poverty and joblessness in the 1990s and beyond. Then, as now, we were collectively deceived by the false promise that privatization, fiscal discipline, and market-friendly policies would bring prosperity. The truth is that GEAR deepened inequality, weakened state capacity, and transformed essential public services into commodities for capitalist exploitation.
Now, under the Government of Neoliberal Unity, Godongwana is once more accelerating the privatization of the South African economy under the guise of Public-Private Partnerships (PPPs). The transport and energy sectors are being handed to private interests: Transnet is being corporatized, Eskom’s restructuring is paving the way for full-scale privatization, and public infrastructure projects are being designed to enrich investors rather than develop the nation. Eskom’s debt “relief” package, slashed from R70 billion to R50 billion, does not strengthen energy security but instead ensures that private Independent Power Producers (IPPs) take control of electricity generation whilst the vast majority of working-class households remain burdened by soaring tariffs.
Meanwhile, the state is opening Transnet’s ports and railways to private operators, following the same failed path that led to mass retrenchments under GEAR. Instead of expanding public ownership and industrial capacity, the budget confirms the state’s willingness to auction off South Africa’s economic backbone to capitalists.
The infrastructure sector follows the same pattern. The government has announced a R1 trillion investment plan but has tied it to private capital, foreign investors, and financial institutions. Even the first-ever Infrastructure Bond, set for 2025/26, is designed to attract private lenders rather than ensuring state-led industrialization and public investment. This mirrors GEAR’s logic, where instead of funding public-led development, the state acts as a facilitator for capitalist profit expansion and extraction.
Even in fiscal policy, the obsession with austerity and debt reduction remains unchanged. GEAR imposed rigid deficit targets that crippled public services, this budget does the same. Debt-service costs of R389.6 billion now consume 22 cents of every rand, prioritizing creditors over classrooms, hospitals, and housing. The government calls this “fiscal discipline,” but for the working class, it means deepening poverty and worsening unemployment.
Local government, the closest tier of governance to the people, remains underfunded and neglected. Despite 70% of municipalities being bankrupt, the budget provides no meaningful intervention to strengthen their capacity to deliver essential services. Instead, it paves the way for further privatization, ensuring that basic services such as water, electricity, and sanitation are handed over to profit-driven entities rather than being expanded as public goods.
As a result, communities already struggling under rising costs of living will now face higher service fees, inconsistent delivery, and deepening inequality. Rather than addressing the historical underfunding of municipalities, the state continues to abandon its developmental obligations, entrenching a cycle of inefficiency and economic exclusion. The devastating effects of these policies were clear in the past, and if left unchallenged, they will once again condemn working-class communities to a future of hardship and deprivation
Conclusion:
The YCLSA rejects this budget in its entirety. It is a direct attack on the working class and youth, crafted to serve the interests of capital while deepening poverty, unemployment, and economic exclusion. The state is retreating from the goals of the National Democratic Revolution, while capital is advancing with full force, capturing policy direction and dismantling the developmental role of the government. This betrayal is not just an economic failure; it is a political abandonment of the millions who fought for liberation and expected a future free from the exploitation of neoliberal capitalism.
We refuse to allow another generation to be sacrificed on the altar of profit and neoliberal greed. The youth are already bearing the brunt of mass unemployment, a collapsing education system, and rising costs of living, yet the government’s response is to tighten austerity and push privatization even further. This is a deliberate choice, not an economic necessity. There is money to fund free education, universal healthcare, and large-scale job creation, but instead, the Godongwanas budget shields corporate interests while unloading the burden onto the working class.
If the state refuses to listen, we will make them listen. We will occupy the streets, disrupt their boardrooms, and shut down institutions that enforce capitalist austerity. We will mobilize, organize, agitate, and take the struggle to the Department of National Treasury’s doorstep until a People’s Budget is tabled by the Minister of Finance We want a budget that serves the working class, not the ruling elite. No retreat, no surrender! No to austerity! No to capitalist exploitation! Yes to socialism!
Issued by the Young Communist League of South Africa (YCLSA) Date: 14 March 2024
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