Students continue to drown in rising inflation 

by | Feb 27, 2025 | News

The cost of living is still under pressure as rising inflation patterns continue. 

On 26 February 2025, Statistics South Africa (SA) released the Consumer Price Index (CPI) for January, which has been raised to 3.2%, up from 3.0% in December 2024.

The CPI measures the average change of prices of goods and services typically bought by South Africans. It is a key indicator of inflation as it shows how the cost of living is rising or falling. 

The contributors to the annual inflation rate include housing and utilities, food and non-alcoholic beverages, and restaurants and accommodation services.

The increase in prices affects people at all levels, including cash-strapped students. Luthando Nzama, a second year Fine Arts Student at the Wits School of Arts (WSOA), said students can’t keep up. “Whenever we go to Checkers or shopping centre’s the prices are really high and that affects the amount of groceries we (can buy),” she said.  

Sizwe Gumede, a second year Civil Engineering student at Wits University has also experienced the brunt of inflation. “Based on my experience, we aren’t able to afford some of the services and goods that we need,” he said.

Gumede said many students struggle to buy themselves essentials such as toiletries and thinks increased allowances may help. 

“I heard that NSFAS will be going up, but for the past couple of years it’s been at the same rate while inflation is increasing. This left us students vulnerable to not (being able to) survive off this kind of funding,” he added. Last week, NSFAS confirmed that allowances for university students would increase by 4% and 46% for those studying at TVET colleges.   

Various sources have researched the monthly average students need to get by, it ranges between R1500 to R3000 for groceries alone and between R500 and R1000 for other personal items.  

As inflation increases, young people on the ground continue to be affected by the rising cost of living and are attempting to make ends meet.  

FEATURED IMAGE: South African cash notes. Photo: File.

RELATED ARTICLES:

Slice: 2026 World Cup: nostalgia, noise, and new concerns

by | May 15, 2026 | Featured 2

South Africa’s qualification for the 2026 FIFA World Cup has sparked familiar excitement among fans. For many, it brings back memories of the 2010 FIFA World Cup in South Africa. A tournament widely remembered as one of the most iconic in modern football history and the first ever hosted on African soil.

But 2026 is not 2010.

The upcoming tournament, hosted across the United States, Mexico, and Canada, arrives in a vastly different global climate. While FIFA has spearheaded the expanded format as a celebration of global football, fans have raised growing concerns about whether the World Cup will remain truly accessible to the people who give it life—the fans.

A major concern is accessibility. Reports and human rights organisations have warned that visa restrictions and immigration policies in the United States could make it difficult for fans from certain countries to attend matches (Amnesty International on travel restriction). While all qualified teams are expected to participate, supporters from parts of Africa, the Middle East, and other regions may still face financial and administrative restrictions that limit their ability to travel.

Another growing issue? Cost. Rising inflation, expensive accommodation, and long-distance travel mean that attending the World Cup is becoming increasingly unaffordable for ordinary fans. What was once a global gathering of football cultures risks shifting toward a more commercialised experience shaped by tourism markets and corporate access.

Alongside these concerns, FIFA’s cultural strategy appears increasingly rooted in nostalgia. The return of global music icon Shakira to World Cup discussions following her legendary 2010 anthem Waka Waka (This Time for Africa) has reignited excitement among fans. Music has always been central to football’s identity, and Shakira’s presence connects the present tournament to one of its most celebrated eras.

However, this raises a deeper question: is nostalgia being used to mask growing concerns about the tournament itself?

There is no doubt that the 2026 World Cup will be one of the largest sporting events ever staged. But scale is not the same as spirit. Football’s power has always come from its people, travelling supporters, emotional crowds, and global accessibility. Without that, the World Cup risks losing the very identity that made it the world’s game.

As excitement builds, one question remains unavoidable: what is a World Cup, if the world itself cannot fully be there?

FEATURED IMAGE: A graphic of Shakira and Zakumi. Photos by: Oouinouin and Jason Bagley. Graphic by: Sanele Sithole

RELATED STORIES:

The R520 million ghost: why Witsies’ missing middle are still in the dark

by | May 15, 2026 | News

R520-million partnership between Universities South Africa and Services SETA intended to be a lifeline for the missing middle has been met with administrative silence as Wits University leaves students in the dark. 

  • Wits University received R20 million of a R520 million national bursary allocation. 
  • Both USAf and the university financial aid have declined to clarify how the funds will be distributed. 
  • Eligible self-funded students lack information on how to access the aid despite the high-profile announcement. 

A partnership between Universities South Africa (USAf) and Services SETA launched an ambitious R520 million bursary fund on 30 April 2026 aimed at funding 5 200 students up to R100 000 a year for three years, but details of how Wits students can access the institution’s allocated R20 million remain unavailable with university authorities refusing to divulge any information.  

The R520 million was distributed equally across 26 public universities in South Africa, with each institution receiving R20 million to support up to 200 beneficiaries. 

An infographic illustrating the USAf and Servies SETA partnership. Graphic by: Rearabilwe Tsebela

In a press statement, USAf stated that the bursary fund is open to first-time  applicants who are South African citizens enrolled at a public university, with funding capped at R100 000  per year. USAf CEO Dr Phethiwe Matutu, linked the fund to the missing middle gap students whose household income exceeds the R350 000 NSFAS threshold, but who still face financial pressure. However, the missing middle at Wits University are finding that information is strictly private. 

“I have a concern that we are singling out specific funding”, stated Amanda Kort, a representative of the Wits financial aid office. “This is an internal administrative process, and I do not believe that we should provide the information nor the interview.” 

This wall of silence is mirrored at the national level. Gcina Nhleko, USAf manager for corporate communications and media inquiries, deferred responsibility to the campus. “We do not allocate funds to students as USAf, but universities do,” Nhleko said. “We have been requested to follow the university protocols, please liaise with your financial aid bureau.” 

Ntsako Mngomezulu, a bachelor of science student majoring in geology and applied geology, who is a self-funded missing middle student, has not found any information on where to apply for the R100 000 bursary. She noted that while the funding would “unburden her the cap does not adjust to inflation in Johannesburg.” 

Lethabo Leputu, a bachelor of arts in film and television student, echoes the information gap. “It is my first time hearing about this,” she said when asked about the bursary. Leputu is partially funded by the National Film and Video Foundation which covers her tuition, but she must still find money for accommodation: placing her squarely in the missing middle. While acknowledging the R100 000 would not cover everything, she sees real value in what it could cover. “I would really appreciate my residence fees being covered. That would alleviate the stress and anxiety that comes with seeing your fee statement,” she said.    

The lack of transparency raises questions about accountability, especially as Services SETA acting CEO Sibusio Dhladla noted the organisation is currently under administration due to “governance failures.”

Services SETA had not responded to requests for comment by the time of publication. For now, the R20 million earmarked for Wits remains a ghost in the system, leaving the students it was meant to support without a clear path to access the promised relief. 

FEATURED IMAGE: Wits students protest against fee increase in 2016. Gap funding came as a solution from government to help students whose household income is less than R600 000. Photo: Wits Vuvuzela/File

RELATED STORIES:

EDITORIAL: The global cost of the U.S and Israel’s “pre-emptive strike” on Iran 

by | Mar 6, 2026 | News

The war in the Middle East deeply impacts the lives of people across the globe and South Africa is no exception.   

Millions of people woke up to the breaking news on their screens, that the United States of America and the State of Israel, launched airstrikes targeted at Iran’s military bases and nuclear-related-infrastructure, on February 28, 2026. The prospects of a war started brewing after negotiations between the U.S and Iran in early February hit a dead end.  

Iran’s Supreme Leader Ayatollah Ali Khamenei was killed by attacks from Israel and the U.S, and the current death toll in Iran currently surpasses 1, 000.  Iran has responded by launching missiles and drones towards Israel and targeting U.S military bases across the Middle East. The countries affected by the attacks from Iran include Saudi Arabia, United Arab Emirates and Kuwait.

But it was the confirmed closure of the Strait of Hormuz on March 2, that had an immediate global impact . According to Reuters, Iranian officials announced that the shipping corridor will be closed and any ship that attempts to pass through will be attacked.  

Approximately 20% of the world’s oil supply passes through the Strait of Hormuz, which means global oil prices, inflation, food and petrol prices are likely to increase significantly in the short term.   

South Africa imports oil in large quantities, most of its crude oil supply coming from Nigeria and Saudi Arabia. This means that citizens will experience higher petrol prices and businesses will experience delayed goods from abroad. The impact was felt instantly as the minister of Mineral and Petroleum Gwede Mantashe announced an increase in fuel prices effective from March 4, as a result of the current international factors. The price of petrol increased by 20c and diesel by 65c, residents still await further changes as the war continues.  

Behind the geopolitical strategies and missile attacks we watch from a distance are thousands of people whose lives have now been forever altered. Families are watching their homes and communities destroyed and those far removed from the shockwaves deal with rising costs and uncertainty.  

As the situation unfolds, we are confronted with the fact that war is never limited to the countries fighting it, its impact is felt by everyone. We all mourn and feel the pain of those directly impacted.  

Until the day global leaders choose dialogue and peace over destruction and violence, it will be us, ordinary citizens who continue to pay the price for their negligent and violent behaviour.  

FEATURED IMAGE: Graphic depicting the joint allies the United States of America and the State of Israel, above Iran. Graphic by: Bonolo Mokonoto

RELATED ARTICLES:

The new minimum wage amount set to increase by R1, 44 

by | Feb 18, 2026 | News

The increase in the minimum wage amount is not as impactful as the minister of labour and employment would suggest.  

  • The minimum wage amount has increased to R30, 23 per hour from R28, 79 per hour. 
  • The new minimum wage is still not enough to sustain South Africans.  
  • Millions still struggle to cater to their basic needs. 

The minimum wage amount is set to increase to R30,23 per hour, from R28,23 per hour as of March 1, 2026. South Africans are beyond frustrated by this small change. 

“The income is basically the same, given that the economy is also changing. [The government] increasing the minimum wage doesn’t change the fact that things are also getting more expensive. If, lets say, they were increasing the wages, but the economy’s status was still the same at least [there] would be a bit of a change, compared to right now,” said Rose Mongwe, a third-year bachelor of education student.   

The minimal increase, means Mongwe, whose mother is a domestic worker will not get an allowance increase this year. She uses what her mom can give her for toiletries and other personal needs.  “It is not [as much] as I would want it to be but then it kind of helps here and there and sustains me when I’m unable to get some money for myself,” she said.  

Muhammed Siyad the Regional Investment Growth Manager for Southern Gauteng at Absa said, “At the rate at which inflation is climbing, this increase of the minimum wage amount per hour I don’t feel it would affect any households in a positive sense, the reason for that is everything else is getting more expensive, its making it harder for people to manage based on the current salaries.” 

Neo Bapela honours in bachelor of education said, “I feel like the [minimum wages amount] is very little, but also it goes according to peoples’ responsibilities, I might think that the money is enough for me, because I don’t have kids, I don’t have other responsibilities.”  

The increase of the minimum wage amount does not keep up with the rising cost of living. Many households continue to stretch out their money, the increase of R1,44 offers little to no relief.  

FEATURED IMAGE: Cash and coins. Photo: Bonolo Mokonoto

RELATED ARTICLES:

FINANCE FEATURE: Why are degrees so expensive?

by | Oct 13, 2025 | News

Despite tuition appearing cheaper on paper, Wits students from financially disadvantaged households still grapple with mounting debt and the hidden costs of higher education.

  • Wits students face growing debt and hidden expenses that make higher education increasingly unaffordable despite seemingly low tuition costs.
  • Universities struggle with declining government subsidies, inflation-driven expenses, and financial strain, forcing them to raise student fees to survive.
  • NSFAS funding limits and inconsistent policies deepen student inequality, threatening to reverse the hard-won progress of the Fees Must Fall movement.

When Medupi Reginald Mathunyane, a final-year Biological Sciences student at Wits University, was defunded by the National Student Financial Aid Scheme (NSFAS) in 2022, the weight of uncertainty hit him hard. Months of appeals followed, each one a battle against bureaucracy and mounting financial anxiety. Today, as he nears graduation, his debt exceeds R100,000, growing every semester.

“I’ve done everything I can just to stay in class,” Mathunyane says, his voice carrying both determination and exhaustion. “But the stress of thinking about how I’ll pay back this debt never goes away. It’s like carrying a shadow over my studies, reminding me I might not make it through without sacrificing my dedication to my studies, with the hope that someday I will be funded.”

Mathunyane’s story is not unique. Across South Africa, students from financially disadvantaged households are feeling the squeeze. Yet on paper, higher education appears more affordable than ever. Professor Imraan Valodia, a former Wits University dean and respected economist, explains that comparing tuition fees over time without accounting for inflation gives a misleading picture.

“Degrees are not entirely more expensive,” he says. “If you take R60,000 in 2010, it would be roughly equivalent to R125,000 in 2025 when we adjust for inflation. By that measure, a R100,000 degree today is technically cheaper.”

But Valodia stresses that these numbers mask the lived reality for students. Over the past 15 years, South Africa’s consumer price index has averaged around 5% per year, while the higher education CPI (which tracks costs specific to universities such as equipment, laboratory maintenance and academic resources) has risen even faster. This means that even if tuition has not increased as sharply in nominal terms, the cost of delivering quality education has, leaving institutions and students caught in a financial tug-of-war.

At the heart of the affordability debate lies South Africa’s strained public finances. For years, sluggish GDP growth has constrained government revenue, leaving the Treasury with difficult choices between competing priorities: healthcare, social protection, infrastructure, and education all vie for the same shrinking fiscal pie.

South Africa’s GDP growth has averaged below 1% over the past decade, with Treasury forecasting just 1.4% in 2025. Weak growth means less tax revenue. And without sufficient revenue, the government cannot expand higher education funding without cutting elsewhere.

The 2025/26 Budget allocated R146.6 billion to post-school education and training, about 5.7% of the total R2.58 trillion consolidated budget. Debt-service costs alone consume nearly R426.3 billion, almost three times higher.

The numbers reflect the impossible trade-offs. South Africa spends generously on education in global terms, at about 6.1% of GDP compared to the global average of 4.4%, yet this has not translated into affordability for individual students. Much of the spending goes to maintaining an already burdened system rather than making degrees cheaper at the point of entry.

Wits spokesperson Sherona Patel highlights the pressures universities face, which often go unseen.

“The University generally receives its income from three sources: state subsidies, student fees, and third-stream income such as donations or contract research,” Patel explains. “If subsidies decline in real terms, then student fees increase. Surpluses are reinvested into the academic project to ensure sustainability for future generations.”

Patel points out that the higher education inflation rate often outpaces general inflation. Specialized laboratory equipment, international journal subscriptions, and research costs are usually denominated in foreign currency, leaving universities vulnerable to exchange rate fluctuations. On top of this, Wits must cover additional domestic expenses, including diesel and water tankers during load shedding and water shedding, private security around Braamfontein, and inter-campus transport.

Despite these pressures, Patel notes that Wits allocated R2.33 billion in financial aid, bursaries, and scholarships in 2024, helping over 30,000 students access higher education. Historic debt totalling R63 million was cleared for nearly 800 students. Even with these efforts, Patel admits that the University cannot cover all student costs without risking insolvency. “Free education and debt clearance require national solutions involving government, the private sector, and donors,” she says.

Even the National Student Financial Aid Scheme, meant to be a buffer against financial exclusion, has struggled to keep pace with rising costs. In February 2025, the scheme announced a 4% increase in allowances for university students and a massive 46% increase for those in TVET colleges to cushion the blow of inflation. Yet students argue that these increases barely scratch the surface in cities like Johannesburg, where rent and transport costs quickly erode monthly stipends. NSFAS itself acknowledged the pressure, stating that “where necessary, NSFAS will take extraordinary measures to ensure that NSFAS-funded students are not left stranded due to skyrocketing accommodation costs.”

For the Wits SRC Treasurer General, Liyabona Baartman, the statistics do little to soften the financial reality facing students.

“The financial barrier is tuition and accommodation together,” he says. “Take someone studying medicine at UKZN and someone doing the same at Wits. The UKZN student pays less. Yet NSFAS applies the same funding formula across the country. That does not make sense. Living in Johannesburg is more expensive than living in KZN. NSFAS needs a case-by-case approach.”

Baartman also warns that the gains of the Fees Must Fall movement are being undermined.

“Before Fees Must Fall, NSFAS was a loan. We fought tooth and nail to turn it into a bursary. That was a major gain. But now, those gains are being reversed. NSFAS used to pay the full cost of accommodation. Now there’s a cap, leaving students stranded. The inconsistency in challenging the system has allowed these rollbacks to happen.”

For Mathunyane, the numbers are not abstract. They are lived experiences: long nights balancing part-time work and studies, the constant worry of falling behind, and the persistent anxiety that debt may derail his dreams.

“I’ve survived this far,” he says. “But I don’t know what will happen after I graduate. The debt does not go away. It feels like the system is built to make you survive, not thrive.”

At the heart of the debate is a national question: who should bear the cost of higher education? Families already grappling with unemployment and inflation feel the pinch. Universities warn they cannot fund every student without collapsing. Students insist that education is a right, not a privilege reserved for the middle class.

As Patel explains, “Student funding is a national challenge and requires broader discussions and solutions.” Baartman counters, “We cannot let the gains of Fees Must Fall be rolled back. Free education is still the goal.”

Until these tensions are resolved, higher education remains both a lifeline and a financial cliff, cheaper on paper, yet still impossible for those who need it most.

FEATURED IMAGE: Graphic of Wits University the stock market prices Going up to and logos by Phenyo Selinda

RELATED ARTICLES:


FINANCE FEATURE: Why financial freedom feels out of reach for South Africa’s graduates 

by | Aug 30, 2025 | News

 Graduating no longer guarantees stability. With stagnant salaries, high living costs, and family obligations, young South Africans are working hard but falling behind. 

  • “Financial freedom is possible, but it requires discipline, sacrifice, and smart investing,” said Dr Nkunzi 
  • The cost of living is rising faster than paychecks. 
  • Internships or entry-level jobs typically pay too little to cover the cost of living. 

When Kgomotso Mogale graduated with a biomedicine degree from Eduvos in 2024, she imagined a future in a laboratory or research facility, applying her skills in a field she had dedicated years of study to. Instead, she found herself in sales at a private university, earning just R8000 a month. On paper, it’s a stable job. But in reality, the numbers don’t add up. 

Living in Midrand, next to the school she works at, Mogale pays R6000 for rent, leaving only R2000 to stretch across food and other daily needs. By month-end, nothing is left of her salary. Saving for the future is impossible, considering the fact that she also sends her mother money at home. 

“I thought getting my degree would mean independence,” Mogale said. “But I can’t even afford the basics. Everything feels too much,” she added. 

Monthly Salary vs Expenses. Graph: Dikeledi, Canva

Dr. Sibulele Nkunzi, lecturer at Wits University’s School of Economics and Finance noted that it is shocking how little internships still pay, with many offering between R5,000 and R8,000. 

 “That barely covers the cost of a small apartment in Johannesburg,” he explained. What is more concerning, he added, is that this level of pay has hardly changed in 15 years, despite rising living costs. Entry-level salaries should be adjusted for inflation, but companies often point to budget pressures and higher operational costs as reasons for holding back. The result is that graduates in cities like Midrand face unaffordable expenses, sometimes forcing them to drop out of the job market altogether. 

For a lot of South African graduates, Mogale’s story is very common. Graduating from university is meant to signal the start of adulthood, but for today’s generation, it often marks the beginning of financial struggle. 

Internships or entry-level jobs typically pay too little to cover the cost of living in cities like Johannesburg, Pretoria, and Cape Town. Rent, transport, and food consume almost everything, leaving no room for savings or long-term planning. 

Stats SA reports that youth unemployment remains very high, with thousands of graduates across the country struggle to find work in their fields. Many, like Mogale, are forced into roles outside their area of study simply to survive. 

Stats SA data. Graph: Dikeledi Ramabula, Canva

Even people who have jobs are earning less in reality, because prices keep going up while their salaries stay the same. According to the BankservAfrica Take-Home Pay Index, real salaries in South Africa have barely grown over the past five years. That means even when graduates earn more on paper, their money stretches less every month. 

“The cost of living is rising faster than paychecks,” says Johannesburg-based financial educator Ona Selepe. “Young professionals are earning, but they’re not getting ahead. Most can’t save, and many turn to debt just to stay afloat,” she said. 

In Mogale’s case, small things like catching a taxi to go buy groceries drain her budget. “By the time I pay for taxis and groceries, I’m in the red. I’m not even thinking about things like medical aid or investments. I simply can’t afford them,” she said. 

Beyond rising costs, there’s another layer of pressure unique to many South Africans: “black tax.” Graduates who are the first in their families to secure jobs often feel obligated to support parents or siblings financially, even when they themselves are struggling. 

Human resources consultant Mummy Seriti says this expectation places young workers in impossible positions. “They’re expected to live up to the image of success, the car, the good suburb, but the money simply isn’t there to sustain that lifestyle.” 

For Mogale, the thought of helping family members is overwhelming. “I want to support them, but how can I when I can barely support myself?” 

Dr.Nkunzi explained how inflation is hitting new graduates especially hard. “The high cost of living makes it difficult for graduates to cope, particularly those starting out in low-pay internships,” he said. “Most of their income goes straight to rent, transport, and groceries, leaving little for basics like electricity, internet, or even toiletries. 

“Without parental support, many are forced to stretch limited pay to survive. This constant financial pressure doesn’t just reduce quality of life, it also harms mental health, work performance, and relationships,” he added. 

Dr. Nkunzi emphasised that financial literacy is crucial for young graduates trying to make the most of their limited income. “The truth is, many people only learn about money after making costly mistakes,” he said. Being proactive, learning how to budget, avoiding unnecessary debt, and starting early, can make a significant difference. 

He stressed that financial freedom is possible, but it requires discipline, sacrifice, and smart investing. Graduates may also need to explore alternative income streams, which are increasingly available through technology and the gig economy, to ease pressure and begin building a more secure financial future. 

Mogale’s journey reflects a generation caught between ambition and survival, a reminder that until conditions change, financial freedom will remain out of reach for too many graduates. 

FEATURED IMAGE: Monthly Salary vs Expenses. Graph: Dikeledi, Canva

RELATED ARTICLES:

Relief for students as VAT increase is reversed 

by | May 2, 2025 | News

Finance Minister, Enoch Godongwana agrees to a court order to suspend his decision to increase VAT and this means economic relief to many 

  • VAT increase suspension leave students with a sense of relief
  • Increased VAT rate was met with resistance from various political parties
  • Reversal comes with a R75 billion shortfall for the government revenue

Wits University students expressed relief as Finance Minister, Enoch Godongwana, announced reversal of the 0.5% VAT increase on April 23, 2025 after the DA challenged the legality of the parliamentary process that passed the increase.  

The initial proposal to increase the VAT rate by 0.5 percentage points was met with resistance from various political parties, including the Democratic Alliance (DA) and the Economic Freedom Fighters (EFF).  

For many South Africans, the suspension has provided much-needed relief, including Wits students. As consumers, particularly from lower-income households, funded by bursaries, the VAT increase would have been a big blow.  

Shaunice van Wyk, 3rd year student said: “The VAT increase would have forced me to stop buying the basic products that I am used to buying, so the suspension comes with a relief”.  

Another third-year student, Patience Msiza, echoed similar sentiments, “As a student I am already struggling to make ends meet, so the increase of VAT rate was going to make things even worse.” 

Although the suspension comes with relief, it will result in a R75 billion shortfall in government revenue, prompting the National Treasury to revisit its budget.  

Professor Imraan Valodia, an economist at University of Witwatersrand, who previously written in support of the VAT increase, expressed concerns about the long-term implications. 

“We’ll have to see what comes in the revised budget, but I think government will have to cut expenditure, which means we’ve missed the opportunity to address the social and economic infrastructure backlogs, which are important for shifting the economy onto a growth trajectory to address unemployment and growing levels of poverty.”  

FEATURED IMAGE: Black wallet Photo: Abena Mahlahlane

RELATED ARTICLES:

VAT increase to hit Wits students 

by | Apr 11, 2025 | News

Wits students brace for the impact of a VAT increase, as stagnant NSFAS allowances fail to keep with inflation and rising daily expenses. 

  • A 0.5 percentage point VAT increase takes effect on May 1, 2025, raising concerns over affordability of essentials for Wits students.
  • NSFAS-funded students say their allowances don’t keep up with inflation, forcing spending cuts on food, toiletries, and daily essentials.
  • Wits University says it cannot exceed funder limits or risk its financial sustainability.

With the cost of living sky-high, Wits University students funded by the National Student Financial Aid Scheme (NSFAS) are preparing for another financial hit, a 0.5 percentage point increase in Value-Added Tax (VAT) set to take effect on May 1, 2025. 

Finance minister, Enoch Godongwana, ​said​ the increase was necessary to increase public revenue. ​   

Dr Jerome Lange, an economics lecturer at Wits University,​ said the​ impact is tangible for low-income students. “They might opt to not spend that extra unit to buy bread or electricity if it’s more expensive.” 

He raised concerns about the fairness of the tax. “It’s not a measure that works toward equality. Structures like NSFAS safeguard students against poverty, but 0.5 percentage points can still make a difference. Wits is already financially squeezed and limited in the kind of relief it can offer students,” he said. 

Government intends to expand VAT zero-rated food items but the risk for students remains high. 

A basket of zero-rated food items, including brown bread, eggs, cooking oil, milk, potatoes, onions, and rice, essentials for food security among students. These items are exempt from VAT, according to the South African Revenue Service’s 2022 VAT guide. Photo: Likho Mbuka 

Owame Mfeka, a second-year student said, “The potential for inflation remains. NSFAS allowances are not adjusted for inflation, meaning our purchasing power keeps declining.” He said, “to meaningfully support students, allowances should rise at inflation rate.” 

Sibahle Majingo, a second-year student, said he’s already making tough decisions about spending. “Even though the NSFAS allowance increased slightly this year, it’s still not enough. I have to prioritise food and toiletries, look for discounts, and reduce all non-essentials, takeaways or entertainment.”  

Majingo, who also sends money home, said he may need to take on part-time work to cope. “It’s frustrating because the cost of living rises faster than our support. Wits could help by reducing residence prices and ensuring timely allowance payments,” he said. 

But Wits spokesperson, Shirona Patel, said the university cannot exceed limits of funder allocations or risk financial sustainability, saying rising costs affect staff, students, and suppliers.  

As VAT increases and the economic pinch tightens, many students fear the strain on their finances will not only affect their pockets but their ability to focus on their academic goals.  

With limited institutional flexibility and slow-moving adjustments from NSFAS, the question remains: Who will cushion the students from the ripple effects of this tax increase? 

FEATURE IMAGE: A R10 note and coins, the reality for many students surviving on limited monthly allowances. Even a 0.5 percentage point VAT increase can significantly affect purchasing power. Photo: Likho Mbuka

RELATED ARTICLES ​​​    

​​​     ​​​     ​​​ 

Budget Speech 2025: No pain, no gain

by | Mar 13, 2025 | News

To meet persistent service delivery needs, the government has proposed a VAT increase of 1% over two years, raising the rate to 16% by 2026/27.

Finance Minister Enoch Gondongwana finally delivered the 2025 Budget speech on March 12, after a shock cancellation in February. The approval process will follow, with Parliament set to review, debate, and vote on the proposal.

While much of the public debate has focused on the proposed VAT increase, Gondongwana said “the central issue is fostering economic growth for the majority. Over the past decade, South Africa’s economy has stagnated, with GDP growth averaging under two percent”.

To achieve the country’s goals of redistribution and structural transformation, a faster, more inclusive economy is essential.

The 2025 budget outlines a strategy centered on “macroeconomic stability, structural reforms, infrastructure investment, and improving state capability to unlock the country’s productive capacity,” said Gondongwana.

With fiscal stability in focus, the budget also targets reducing debt-service costs and addressing critical issues like Eskom’s debt. Stabilising the economy, enhancing job creation, and advancing social services, are all at the top of the list.

Infrastructure remains a key focus in the 2025 Budget, with over R1 trillion allocated to capital spending over the next three years. Key areas of investment include R402 billion for transport, R219.2 billion for energy, and R156.3 billion for water and sanitation.

Projects such as upgrading roads, rebuilding the Passenger Rail Agency of South Africa’s infrastructure, and expanding water systems are central to driving economic growth, creating jobs, and improving public services. Public-private partnerships and innovative financing, including an infrastructure bond and credit guarantee vehicle, will further support these efforts.

Godongwana said the VAT increase could help meet persistent service delivery needs. It is expected to generate R28 billion in 2025/26 and R14.5 billion in 2026/27. After weighing alternatives like increasing corporate or personal income taxes, the VAT increase was deemed the most viable option to avoid further spending cuts and ensure essential services continue.

To cushion households from rising living costs, the government will increase social grants above inflation, expand the VAT zero-rated food basket, and keep the fuel levy unchanged, saving consumers R4 billion.

In social security, R284.7 billion is allocated to grants, with increases for the elderly, disabled, and child support. The COVID-19 Social Relief of Distress (SRD) grant will continue until March 2026, with 28 million beneficiaries set to benefit.

The South African Revenue Service (SARS) receives R3.5 billion this year and an additional R4 billion for improved tax collection. Efforts to broaden the tax base and improve compliance will help fund essential government services.

For early childhood development and education, the government allocates R10 billion to increase subsidies and expand access to early education for 700,000 more children. This investment supports the foundation for a better future workforce.

In addition to these measures, funding is set aside for critical health and security services, including a R28.9 billion boost to healthcare to retain workers and ensure adequate staffing in hospitals.

But none of these measures can be implemented without a majority vote in favour, so all eyes will be on parliamentarians for what happens next.

FEATURED IMAGE: The cost of living: South African Rands may not stretch as far if proposed VAT increase takes effect. Photo: Adobe Stock

RELATED ARTICLES:

SLICE: Braam power outages turn campus into my new home 

by | May 16, 2024 | Opinion

Fourteen days without electricity turned my academic ambitions into a harrowing experience.

On the night of May 1, 2024, Braamfontein turned pitch black, as a power outage plunged some parts of the inner city into darkness.  

I was in the newsroom, situated at the E’skia Mphahlele building on Wits East Campus, writing a review of a theatre play I had watched. Living in a country where loadshedding and power interruptions have become the norm, I did not take the outage to mind, thinking the electricity would be restored in a couple of hours.  

The next morning, Johannesburg City Power revealed that underground cables in the Braamfontein area had caught fire, due to suspected cable theft and vandalism. Knowing the city is overseeing the situation, I further relaxed, thinking the matter would be fixed swiftly, but that did not happen.  

Since productivity was limited in my residence room, my daily routine changed dramatically — the library in Solomon Mahlangu House became my accommodation, where I rose early to charge my devices, eat, and do some coursework. 

As a journalism student, I typically have one or two classes daily, allowing ample time for writing articles, research, and programme engagement. I spend most days on campus, occasionally returning to my residence to rest or prepare meals between classes. 

By 10 o’clock in the evenings, I normally return to my room which is a walking distance from campus. I typically buy groceries and cook to save money. 

As food prices have gone up due to inflation. I have resorted to only having one or two meals a day. I sometimes grab lunch provided by the Wits Citizen and Community Outreach (WCCO) programme but in most cases, this clashes with my classes, forcing me to improvise.

But on Saturday May 5, 2024, after a basketball game, I returned to find all my recently bought food spoiled in the fridge, just after I had stocked up for the whole month, a financial setback of note.

Due to only having borehole water at my residence as well as a scarcity of water when there are power outages, I then resorted to commuting to Wits Junction daily so that I could shower at my friend’s place before heading to class. 

I felt hopeless and exhausted, unable to change my situation — fueling resentment for this place called Braamfontein. Without financial assistance or a food allowance, I had to dig deeper into my own pockets. I observed Darwinism firsthand as “survival of the fittest” unfolded in its ruthless and pragmatic manner.  

This situation was a defining moment for me, the emotions I felt, made me look at things differently. Mainly, that challenges will come, but my resilience can see me through.  

Finally, on May 13, 2024, the lights in Braamfontein flickered back to life after a long two weeks. Immediately when the lights came on, the joyous screams of students filled the air, and as if on cue, rain showers descend, bringing a sense of renewal amidst the chaos.

FEATURED IMAGE: Salim Nkosi Photo: File/Leon Sadiki

RELATED ARTICLES: