South Africa’s fragile coalition government has been thrown into turmoil following a dramatic showdown over the national budget, with the ruling African National Congress (ANC) and its coalition partner, the Democratic Alliance (DA), locked in a bitter dispute.
The centre-right DA voted against the fiscal framework, objecting to a proposed increase in Value-Added Tax (VAT) and calling for sweeping spending cuts across government departments.
The ANC, a self-styled centre-left party, refused to yield to what it described as the DA’s push for an “austerity budget.” In a show of political dexterity, President Cyril Ramaphosa’s party marshalled the support of smaller parties within and outside the government to secure a narrow victory, passing the fiscal framework in parliament by 194 votes to 182.
The DA has responded with fury, filing legal papers to challenge the vote, arguing it was “procedurally flawed.” Meanwhile, its leadership is set to deliberate on whether to remain part of what South Africans term the Government of National Unity (GNU).
“It will be asking itself whether this is the tipping point or whether it should wait – at least until the outcome of the court case,” said Professor William Gumede of Wits University’s School of Governance.
The cracks in the coalition, formed less than a year ago after the ANC lost its parliamentary majority for the first time since Nelson Mandela led it to power in 1994, have left the business sector deeply concerned. South Africa’s economic players had championed the ANC-DA alliance as the best route to stability. Now, DA spokesman Willie Aucamp has accused the ANC of a “serious infraction,” hinting that the party’s continued participation in the coalition is in doubt.
“The ANC has crossed a line in the sand,” Aucamp said.
DA federal chair Helen Zille struck a measured tone, acknowledging that coalition governance requires compromise, but accused the ANC of refusing to share power.
“We know that being in a coalition requires compromise. You can’t get it all. But the ANC also can’t get it all, and they are refusing, point blank, to share power,” Zille remarked.
The ANC, in turn, lashed out at its coalition partner. The party’s parliamentary chief whip, Mdumiseni Ntuli, labelled the DA’s actions “a complete betrayal.”
“The DA is a member, or was a member,” he said pointedly. “I don’t know what is going to happen with them now, but the GNU remains.”
Presidential spokesperson Vincent Magwenya echoed this sentiment, bluntly stating: “You can’t be part of a government whose budget you opposed.”
Ironically, the DA’s stance saw it voting alongside two of its fiercest ideological adversaries: former President Jacob Zuma’s uMkhonto weSizwe (MK) party and Julius Malema’s Economic Freedom Fighters (EFF). Both parties, which advocate nationalisation and radical economic reform, shared the DA’s opposition to the VAT hike, arguing it would disproportionately harm the poor.
DA leader John Steenhuisen seized on this point, criticising the ANC for being out of touch with the financial realities of ordinary South Africans.
“If they bought their own groceries or filled their own tanks, they would know how expensive life already is,” Steenhuisen said.
The ANC, however, insists that the VAT increase – set at 0.5% this year and another 0.5% next year – is essential to fund public services such as healthcare and education. Crucially, the Inkatha Freedom Party (IFP) broke ranks with the DA, siding with the ANC and marking the end of the pre-election alliance that sought to block Ramaphosa from retaining power.
The ANC also secured the support of ActionSA, a DA breakaway party, which claimed it had brokered a deal with the ANC to explore alternative revenue streams rather than implement the VAT hike.
“Yesterday’s adoption of the fiscal framework was merely one step in a multi-stage budgeting process before the final budget is approved,” ActionSA stated.
The budget dispute is just one of many battles brewing between the ANC and DA. The DA is also contesting three major pieces of legislation in court, including the contentious land expropriation act – a law that previously led to strained relations with the United States.
During his presidency, Donald Trump responded to South Africa’s land reform policies by cutting aid and recently imposing 30% tariffs on South African imports, a move set to hit the struggling economy hard.
“They have got some bad things going on in South Africa,” Trump said. “We are paying them billions of dollars, and we cut the funding because a lot of bad things are happening in South Africa.”
Ramaphosa’s office has strongly condemned the tariffs as “punitive,” warning that they could become a “barrier to trade and shared prosperity.”
For ordinary South Africans, the latest crisis underscores the urgent need for the ANC and DA to set aside their differences and govern effectively. With unemployment above 30% and the economy teetering on the edge, the alternative is an even deeper crisis that the country can ill afford.
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