MEDIA RELEASE
2026-10-21
SUMMARY: The Labour Party of South Africa (Labour Party) warns that South Africa’s working class cannot continue to pay the price for economic failure and austerity. Ahead of the 2026 Medium-Term Budget Policy Statement, the Party demands a decisive shift towards job creation, cost-of-living relief, infrastructure restoration and reliable public services.
As South Africa prepares for the tabling of the 2026 Medium-Term Budget Policy Statement (MTBPS), the Labour Party calls on National Treasury to present a credible and honest assessment of the country’s economic and fiscal position – one grounded in the daily lived realities of working-class South Africans.
The MTBPS comes at a time of stubbornly high unemployment, weak economic growth, declining state capacity and deteriorating public infrastructure. These challenges place mounting pressure on public finances while ordinary South Africans continue to bear the cost of economic hardship.
The Labour Party maintains that the MTBPS must break with austerity-driven fiscal consolidation that places the burden of economic adjustment on working-class households. Instead, it must present a clear and credible plan to stimulate job creation, unlock productive investment, rebuild public infrastructure and restore reliable public services.
South Africa is facing a deepening cost-of-living crisis. In October 2026, petrol prices increased by more than R3 per litre, pushing the inland price of 95-octane petrol above R30 per litre. Rising fuel costs place additional pressure on household budgets and drive up the cost of transport, food and other essential goods and services. Meanwhile, unemployment remains alarmingly high at 33.6%, leaving millions of people without work and income security. Even among those who are employed, many struggle to make ends meet as wages are eroded by rising living costs.
Despite improved revenue collection by the South African Revenue Service (SARS), working-class households continue to face rising expenses, inadequate services and failing infrastructure. Increased revenue collection means little to ordinary people if it does not translate into a tangible improvement in their living conditions. Government must demonstrate how public resources will be converted into meaningful economic relief and better services for communities.
The Labour Party therefore calls on National Treasury to prioritise job creation, provide meaningful cost-of-living relief and rebuild the public sector’s capacity to deliver essential services. This must include a deliberate programme to rehabilitate and expand public infrastructure, including the country’s rail network, which can support industrial development, create sustainable employment and reduce the cost of transporting people and goods.
“The restoration of public infrastructure must be central to our economic recovery. Over the past 32 years, the deterioration of public infrastructure and the weakening of state capacity have undermined the ability of government to meet the needs of our people. Rebuilding public railways and other essential infrastructure can create sustainable jobs, strengthen productive capacity and contribute to a progressive social wage that improves the quality of life of working-class South Africans”, said Labour Party interim President Joseph Mathunjwa.
The MTBPS must also demonstrate how government intends to maintain sustainable public finances without sacrificing employment, essential services and the economic security of working-class communities. Fiscal credibility cannot be measured by deficit reduction alone; it must also be measured by the state’s ability to meet its social and developmental obligations.
“In today’s MTBPS, government must explain how it intends to manage public borrowing, ease the pressure of rising living costs, create decent and sustainable jobs, and ensure that every rand collected by SARS delivers tangible benefits to the people of South Africa. Working-class communities cannot continue to shoulder the consequences of economic policies that fail to address their material condition”, Mathunjwa said.
“The government must move beyond the narrow pursuit of austerity and fiscal consolidation. We need alternatives that stimulate productive economic activity, rebuild public capacity and relieve South Africans of the mounting cost-of-living burden. Sustainable public finances must serve the people, not become an excuse for withdrawing the support and services on which millions depend”, Mathunjwa concluded.
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