Deputy Minister David Masondo: National Treasury Dept Budget Vote 2026/27

Honourable Chairperson
Honourable members,

The Minister has already laid out the context within which we are presenting the budget vote for the National Treasury.

Section 216 of the Constitution of the Republic, supported by the Public Finance Management Act and the Municipal Financial Management Act, clearly defines the functions and obligations of the National Treasury.

These demand that the department be (a) transparent,  (b) accountable and (c) efficient in the allocation and distribution of public funds, while ensuring that sustainable public finances contribute to inclusive economic growth.

The National Treasury is responsible for managing South Africa’s national government finances.

Supporting efficient and sustainable public financial management is fundamental to the promotion of :

• economic development,
• good governance,
• social progress and a rising standard of living for all South Africans.

The Constitution of the Republic (Chapter 13) mandates the National Treasury to ensure transparency, accountability and sound financial controls in the management of public finances.

Fiscal Framework Mandate

The National Treasury is mandated :

• to  promote government’s fiscal policy framework;
• to coordinate macroeconomic policy and intergovernmental financial relations;
• to manage the budget preparation process;
• to facilitate the Division of Revenue Act;

which provides for an equitable distribution of nationally raised revenue between national, provincial and local government; and to monitor the implementation of provincial budgets.

As directed by the executive and Parliament, the National Treasury will continue :

•  to support the optimal allocation and utilization of financial resources in all spheres of government, in order  to reduce poverty and vulnerability among South Africa’s most marginalized.

This Annual Performance Plan 2026/27 reflects the National Treasury’s commitment to being effective custodians of the nation’s finances.

It is a practical// but ambitious roadmap through which we will support Government’s broader objectives of:

•  higher economic growth,
•  job creation, and
•  improved living standards for all South Africans.

Fiscal Outlook and Strategy

The National Treasury will continue to play a central role in:

•  safeguarding the sustainability of the public finances,
•  strengthening the credibility of fiscal policy and

We also continue to ensure that public resources are allocated in a manner that supports economic growth, social protection and long-term development.

Digitisation For Transparency and Good Governance

Good financial management is fundamental to effective governance and responsible stewardship of public resources.

This is central to :

• maintaining public trust,
• ensuring value for money and
• delivering efficient and effective services.

The modernisation of public management systems represents a significant step change in strengthening (a) transparency,  (b) accountability and (c) good governance.

Along with increasing transparency and publication of information, the department’s digiti-sation initiatives will include:

• the development of a government-wide data exchange platform (MzansiXchange),
• a single sign-on platform (DigiGov) which includes the modernization of the PERSAL system, and
• an end-to-end electronic government procurement system (e-GP). 

National Treasury, together with other government departments, depends on high-quality data to support sound decision-making and evidence-based policy. Yet too often, our data remains fragmented, siloed.

As a result, it is difficult to access across institutions.

MzansiXchange is designed to address this challenge by enabling:

•  secure data sharing; and
•  real time cross-referenced verification of information,

This will help in reducing fraud, in the elimination of double-dipping, and //improving efficiency in service delivery. 

In 2025, we launched the ghost worker and payment irregularity audit using a data-driven approach.

 As part of this effort, we are updating employee records to ensure:

that government information is accurate, current, and reliable across national and provincial departments and strengthen the National Population Register (NPR).

We have developed an online verification platform, which will go live on 15 June 2026, with the verification process open for two months.

National Treasury will issue an Instruction Note outlining the process in detail.

This work forms part of our broader Targeted and Responsible Savings (TARS) initiative.

And future phases will include:

•  a single sign-on tool for public servants and
•  improvements to the payroll system to strengthen controls, prevent irregularities, and improve spending efficiency.

Modernising financial management practices remains a strategic priority for the department.

Phase 1 of this work has commenced through targeted modernization of key legacy systems, including:

• the modernisation of the PERSAL system and
• the automation of Annual Financial Statements.

PERSAL has served as the payroll system for the public service since 1995.

Its 14 million lines of code ensures that 1,4m government employees are paid monthly without ever having been interrupted and with no ongoing license or maintenance costs. However, it is an anti-quated system, hence the department’s priority programme to upgrade introducing enhanced functionality, modern interfacing and advanced inter-operability.

Honorable, the delay in payment of service providers has been a problem, leading to cash flow problems, and often resulting to bankruptcy.

We have also developed an invoice tracking dashboard within existing systems to :

• improve visibility of invoices, and
• strengthen oversight of payment processes.

These interventions form part of a practical, phased and modular approach to:

• strengthening implementation and
• laying the foundation for modern public finance capabilities, including future procurement modernization, in support of a more effective and responsive public service.

The E-GP system (Electronic Govt Procurement System) is an online platform designed to automate and streamline public procurement processes.

This system will be used by the public sector institutions to:

 manage the full life cycle of procuring goods, works and services.

It automates processes like tender publication, bid submission, evaluation and contract management.

It enables government institutions to conduct procurement activities electronically improving transparency, efficiency, and accountability in the procurement process.

The National Treasury is also finalizing the appointment of a service provider to distribute, administer, and manage the RSA Retail Savings Bonds Programme. This initiative forms part of the National Treasury’s broader digital transformation agenda to enhance public access to RSA Retail Bonds and enable South Africans to invest confidently, securing market-related returns in a safe and transparent manner,

Enhancing and enforcing a credible tax system

Meanwhile, the South African Revenue Service (SARS) remains central to the country’s fiscal framework by ensuring the effective and efficient collection of revenue.

Let me also use this opportunity to congratulate  the new SARS Commissioner, Dr. Johnstone Makhubu on his well-deserved appointment.

SARS will continue to:

• strengthen tax administration,
• broaden compliance, and
• modernize its systems to improve taxpayer services while/ combating illicit financial flows, tax evasion, and customs fraud.

Continued investment in data analytics, digital platforms, and enforcement capabilities will support SARS in sustaining revenue collection and protecting the integrity of the tax system

Advocating South Africa’s financial, economic and developmental interests regionally and globally

In the year ahead, South Africa will assume the Chairmanship of the African Caucus of the World Bank Group (WBG) and the IIMF following the Annual Meetings in October 2026.

South Africa will use this opportunity, /// as we did during our G20 Presidency:

 to elevate African development priorities within the WBG and the IMF,

We also ensure these institutions remain relevant to Africa's core development challenges.

Conclusion

The National Treasury Annual Performance Plan plays a crucial role in enabling the service delivery commitments  through:

• prudent fiscal management,
• effective governance and
• responsible leadership of South Africa’s public finances

By clearly identifying the outputs and targets that will direct the work of the department, National Treasury is holding itself accountable for performance and the resources spent in the course of their achievement.

Now more than ever transparency and accountability are cornerstones in:

 building and strengthening a capable and ethical public service to which National Treasury holds itself to the highest measure.

Enquiries:
Sipho Mofokeng (Mr)
Office of the Deputy Minister of Finance
Community Outreach Officer
Cell: 082 513 9535
Office: 012 315 5984
Email: Sipho.Mofokeng@Treasury.gov.za

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