South Africa’s coalition government, formed after the African National Congress (ANC) lost its parliamentary majority for the first time since 1994, is facing a severe crisis. The ANC recently passed the 2025 budget without the support of its key coalition partner, the Democratic Alliance (DA), casting doubt on the future of the Government of National Unity (GNU). This development highlights the fragile nature of South Africa’s coalition politics and raises questions about the ANC’s ability to govern effectively in a divided parliament.
**The Formation of South Africa’s Coalition Government**
The coalition government was formed after the ANC secured only 40% of the vote in the May 2024 elections, forcing it to share power for the first time. The DA, which garnered 22% of the vote, became a critical partner in this arrangement. Smaller parties also joined the coalition, creating a diverse but uneasy alliance. Key ministries such as finance and defense remained under ANC control, while the DA took charge of portfolios like agriculture and public works[3].
This coalition marked a significant departure from decades of single-party dominance by the ANC. However, from its inception, ideological differences between the ANC and DA on issues such as taxation, healthcare policy, and economic empowerment created tensions[3].
**Budget Disputes: A Catalyst for Crisis**
The 2025 budget process exposed deep divisions within the coalition. The ANC proposed increasing value-added tax (VAT) by 2% over two years to address South Africa’s growing fiscal deficit and debt burden. This proposal was met with strong opposition from the DA, which argued that higher taxes would exacerbate economic hardships for ordinary South Africans[2][6].
The budget announcement was delayed multiple times as negotiations failed to bridge differences. Despite revising its original VAT hike proposal to a more gradual increase of 0.5% annually over two years, the ANC failed to secure DA support. The DA demanded more aggressive measures to reduce government debt and opposed what it saw as excessive spending on social programs[1][2].
Ultimately, on April 2, 2025, the ANC pushed the budget through parliament with a narrow 194-182 vote. The DA and other opposition parties voted against it, leaving the ANC reliant on smaller parties like ActionSA and the Inkatha Freedom Party (IFP) for support[4][5].
**Key Features of the Controversial Budget**
The budget includes several contentious measures:
– **VAT Increase**: A phased increase in VAT by 0.5% annually starting in 2025/26.
– **Public Infrastructure Investment**: Over ZAR1 trillion allocated for infrastructure projects over three years.
– **Social Spending**: Social grants were increased above inflation.
– **Debt Management**: Government debt-to-GDP is projected to peak at 76.2% in 2025/26 before declining[1][5].
While these measures aim to stimulate economic growth and reduce fiscal deficits over time, critics argue they place an undue burden on taxpayers without addressing structural inefficiencies in government spending.
**Political Fallout**
The DA’s decision to vote against the budget has strained its relationship with the ANC and raised questions about whether the coalition can survive. DA leader John Steenhuisen criticized smaller parties like ActionSA for supporting what he called an “unconstitutional” budget process and announced plans to challenge its adoption in court[5]. Similarly, Julius Malema’s Economic Freedom Fighters (EFF) also vowed legal action[5].
The ANC’s reliance on smaller parties to pass critical legislation underscores its weakened position in parliament. While ActionSA and others supported this budget, their long-term loyalty remains uncertain.
**Implications for South Africa’s Governance**
The fallout from this budget crisis has far-reaching implications:
1. **Coalition Stability**: The GNU was already fragile due to ideological differences among its members. The budget dispute has deepened mistrust between the ANC and DA, making future collaboration unlikely.
2. **Economic Uncertainty**: Investors are concerned about policy instability as political infighting delays critical reforms needed to address South Africa’s stagnant economy and high unemployment rate.
3. **Legal Challenges**: If courts overturn the budget’s adoption, it could lead to further delays in implementing fiscal policies, compounding economic challenges.
4. **Potential Snap Elections**: Should coalition tensions escalate further, South Africa may face early elections—a scenario that could reshape its political landscape.
**Conclusion**
South Africa’s coalition government is at a crossroads following the ANC’s unilateral passage of the 2025 budget. This crisis highlights both the challenges of governing through coalitions in a politically fragmented environment and the urgent need for compromise among political leaders.
As legal battles loom and public dissatisfaction grows over rising living costs, South Africa faces an uncertain political future. Whether this coalition can survive or whether it marks a turning point toward greater political pluralism remains to be seen.
Citations:
[1] https://think.ing.com/snaps/
[2] https://www.semafor.com/
[3] https://www.bbc.com/news/
[4] https://ground.news/article/
[5] https://www.iol.co.za/news/
[6] https://www.dw.com/en/south-
[7] https://www.iol.co.za/news/
[8] https://businesstech.co.za/
[9] https://www.biznews.com/
[10] https://www.dailymaverick.co.
[11] https://www.iol.co.za/
[12] https://www.dailymaverick.co.
[13] https://www.fitchsolutions.
[14] https://www.bbc.com/news/
[15] https://foreignpolicy.com/
[16] https://www.bbc.com/news/
[17] https://foreignpolicy.com/
[18] https://www.pbs.org/newshour/
[19] https://www.gisreportsonline.
[20] https://www.bbc.com/news/
[21] https://www.dw.com/en/south-
[22] https://www.ewn.co.za/2025/04/
[23] https://www.iol.co.za/
[24] https://www.iol.co.za/
[25] https://www.enca.com/top-
[26] https://www.ewn.co.za/2025/04/
[27] https://www.channelstv.com/
[28] https://www.da.org.za/2025/03/
[29] https://www.iol.co.za/
[30] https://www.iol.co.za/news/
[31] https://www.ewn.co.za/2025/03/
[32] https://www.biznews.com/
[33] https://think.ing.com/
[34] https://www.cbsnews.com/news/
[35] https://abcnews.go.com/
[36] https://www.bbc.com/news/
[37] https://abcnews.go.com/
[38] https://www.citizen.co.za/
[39] https://www.tradingview.com/
