Coalition territory for South Africa is messy and trying — after the budget this week, it could lead to better outcomes or another stalemate.
While the ANC has been dragged into coalition territory almost kicking and screaming, the power shift nationally appears to be drawing out a more pragmatic core in the party.
This core has been long suppressed and locked in by louder, immovable ideologues. The inclusion of the DA, as opposed to the EFF, in the GNU is evidence of this.
What the budget process has shown is that tension remains between two views that emerged in the DA during coalition negotiations after the 2024 election. The first was that the DA should enter government in an all-in coalition arrangement to prove its worth amid stagnating electoral support. The second was that the party should remain in opposition and work with the ANC on a “confidence and supply” basis.
The massive shift in the budgeting process is just the first tangible example of the inter- and intra-party tensions coming into play after finance minister Enoch Godongwana was forced to abandon tabling the budget in February. The DA, some ANC ministers and other GNU partners rejected his inclusion of a two percentage point hike in VAT.
Godongwana was likely to go ahead with tabling the budget this week, but by the time of going to print, the ANC and DA had not agreed on trade-offs over the latter’s support for a smaller VAT increase.
Since the budget postponement, an unprecedented level of consultation has taken place over its contents. This alone is novel for the technocrats in the National Treasury and the minister at its helm.
While consultations over the budget have happened within the ANC and among its alliance partners, Cosatu and the SACP, this has never happened with electoral competitors, who of course are now part of the cabinet.
The risks for the ANC of tying up with the EFF over the budget are huge — and are likely to come with severe electoral consequences
The FM understands that formal talks between coalition partners have been held both bilaterally and multilaterally, separately from formal cabinet talks, and in two special meetings over the past two weeks.
These talks were separate from the discussions held by the ministers committee on the budget, of which the DA is part; the cabinet lekgotla in January; and the special cabinet meeting on the day of the ill-fated, postponed budget.
Then there are the “informal” or “back channel” talks, where the deals are usually first struck and then taken to formal structures. These are the toughest negotiations, and compromises usually rise and fall on the strength here of levels of trust, pragmatism and sincerity.
This week, it was strongly felt in these informal meetings that the budget should be tabled, despite a lack of complete agreement between parties on trade-offs in exchange for a lower increase in VAT.
Sources tell the FM that the main “hiccup” in the end became “how” and “who does what” to implement trade-offs agreed to, in exchange for the DA’s parliamentary support for a smaller VAT increase. The trade-offs include growth reforms, port concessions and budget reprioritisation.
The ANC, DA, IFP and National Freedom Party have managed to keep out former president Jacob Zuma’s MK Party there, and the provincial government has, so far, remained on course.
Whether the ANC and the DA can find each other on these matters before the budget bills come before parliament for a vote in the coming months remains to be seen. While the Sunday Times kicked off speculation that the ANC would turn to the EFF for support if the DA does not agree to vote in favour of the bills, that remains a route littered with downsides for the ANC. For instance, the EFF might demand full access to the GNU, which could mean a retreat by the DA.
The EFF option is not popular in more pragmatic quarters in the ANC, as it heightens the risk of further electoral erosion for the party, due mainly to the fact that the two draw support from the same pool of voters.
Additionally, the EFF has performed poorly in coalitions with the ANC at local government level, particularly in Gauteng — the one party that has been a constant presence in coalitions in the City of Joburg since 2016 is the EFF.
The EFF supported the DA takeover of the city by Herman Mashaba in 2016 and is responsible for the party’s unseating after striking a deal with the ANC in the aftermath of the 2021 local government election. The EFF is not the root cause of the coalition chaos in the city but is certainly a destabilising factor in local government that has burnt both the DA and the ANC — for the latter, it took key posts and delivered little.
This is a stark risk for the ANC as it contemplates its stance in negotiations in the coming weeks. Another risk of drawing in the EFF, which could lead to a DA exit, is the fate of the governance setup in KwaZulu-Natal.
The ANC, DA, IFP and National Freedom Party have managed to keep out former president Jacob Zuma’s MK Party there, and the provincial government has, so far, remained on course. A seismic shift at national level could provide an opening for MK. With a hand on government purse strings in KZN, MK could reverse any potential comeback for the ANC in the province.
So, the risks for the ANC of tying up with the EFF over the budget are huge — and are likely to come with severe electoral consequences.
Then again, the electoral risks associated with potential tax increases are significant. The Social Research Foundation conducted a poll in 2022, and another in 2024, which both indicated that South Africans across race and party lines feel overburdened by the tax regime. In the 2024 polling, 65% agreed that coalition governments should create an environment where large and small businesses could more easily invest and create jobs. Only 3.2% of those polled agreed that coalition governments should increase taxes to improve service delivery.
In the end, coalition territory is predictably proving to be tumultuous for the ANC and its GNU partners, more so as they get down to the real business of governing together.
Let’s hope the pragmatists on all fronts emerge on top.
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