Over the next three years, government spending on economic development will be the fastest-growing function at an annual average rate of 8.1%, driven by higher allocations to infrastructure projects.
According to the 2025 National Treasury Budget Review, medium-term spending for economic development will grow from R252.4 billion in 2024/25 to R318.4 billion in 2027/28.
The Department of Land Reform and Rural Development will expedite the finalisation of outstanding land claims, prioritising older claims.
The department has been allocated R11.6 billion over the medium-term to settle about 844 land restitution claims, with R3 billion earmarked to allocate 138 000 hectares of land.
“Over the medium-term, the Department of Science, Technology and Innovation will invest R3 billion in the construction of the MeerKAT array and efforts to secure the hosting of part of the Square Kilometre Array.
“Guided by evidence and targeted public policy interventions, R2.9 billion will be invested annually in postgraduate development and research support. Additionally, R3.8 billion will be allocated annually to provide access to cutting-edge research infrastructure,” the Budget Review document said.
To enhance productivity, competitiveness and the green economy, government will spend R18.4 billion over the medium term to support businesses through various incentive programmes under the Department of Trade, Industry and Competition.
These programmes include the automotive investment scheme, business process outsourcing, film and television production incentives, special economic zones, clothing and textile competitiveness programmes, the industrial park revitalisation programme and industrial development support for electric vehicle production.
“The Department of Small Business Development is allocated R2.1 billion over the medium-term to support about 120 000 competitive small businesses, particularly those owned by women, youth and people with disabilities in marginalised areas, such as townships and rural regions.
“In addition, government has allocated R313.7 million over the medium-term for the establishment of micro, small and medium enterprise hubs to support business expansion,” National Treasury said.
Government will merge the comprehensive agricultural support programme grant and the Ilima/Letsema projects grant into a single grant with the existing consolidated baseline of R7.3 billion over the Medium-Term Expenditure Framework (MTEF) period.
This merger aims to streamline grant administration, improve resource allocation, and support commercial and subsistence farming.
“To minimise outbreaks of pests and diseases that affect agricultural production, the department will accelerate regulatory compliance and monitoring interventions costing R30.3 million over the medium term.
“The Independent Communications Authority of South Africa is allocated R102 million in 2025/26 for the second phase of the licensing of spectrum through an auction process.
“This is expected to increase investment in networks, improve network quality, contribute to economic growth and lower data costs,” National Treasury said. -SANews.gov.za
