Government ministers, deputies, premiers, and MECs will now be allowed to spend up to R1.1 million on official luxury vehicles. This follows a new directive from Finance Minister Enoch Godongwana and the National Treasury, raising the limit from the previous R800,000 cap.
The revised threshold was outlined in an instruction signed by Treasury director-general Dr. Duncan Pieterse, dated July 11 and implemented earlier this week. The amount includes VAT, maintenance plans, and security upgrades.
This change comes at a time when economic pressures are weighing heavily on ordinary citizens, sparking criticism from several quarters, especially opposition parties.
The previous limit of R800,000 was introduced by former finance minister Tito Mboweni as part of broader cost-containment measures. That cap itself had replaced a R700,000 ceiling set in earlier years.
Dr. Pieterse stated that the finance minister is required to consult with the ministers of police, transport, and state security to determine the price ceiling for executive vehicle purchases on an annual basis.
In the instruction, Pieterse confirmed that “The minister has adjusted the price limit for official vehicles from R800,000 to R1.1 million inclusive of VAT, maintenance plans and security upgrades with effect from the date of this instruction.”
No Room for Creative Spending Loopholes
The Treasury made it clear that the new R1.1 million limit cannot be exceeded under any circumstances. Executive members are forbidden from making personal contributions or negotiating trade-ins that allow them to technically stay within the limit while acquiring a more expensive car.
Departments are also warned against bypassing the rules by leasing higher-value vehicles through services like Fleet Management Trading Entities or similar channels.
Temporary vehicle hire will only be allowed if departments cannot procure an appropriate make and model, and only under strict conditions laid out in the guide for members of the executive.
Departments must report all vehicle purchases in their annual financial statements.
Not the First Time the Cap Has Been Raised
This increase follows a previous exception granted to the Eastern Cape government in September last year. Treasury allowed the province to purchase an official vehicle worth R900,000, excluding security features capped at R100,000. Departments were instructed to work with SAPS for the installation of those upgrades.
Opposition Slams the Increase as Elitist and Immoral
ActionSA MP Alan Beesley was among the first to condemn the Treasury’s move, calling it completely unjustifiable in the current economic climate.
“With close to 50% of households going to bed hungry tonight, the luxury lifestyle of the executive is morally incomprehensible. Under the GNU, we have a bloated cabinet whose perks continue to increase,” he said.
Beesley continued, “How can the Cabinet tell hard-pressed South Africans to tighten their belts when their own belts are getting considerably looser? It is wrong on so many levels.”
He added that corruption does not always look like bribery or theft, but often takes the form of systemic abuse of public resources. ActionSA has introduced the Enhanced Cut Cabinet Perks Bill to amend the law governing executive compensation. The aim is to ensure that such decisions reflect the country’s economic reality.
Maimane: The GNU Has Become a Patronage Machine
Build One South Africa (BOSA) leader Mmusi Maimane, who chairs Parliament’s standing committee on appropriations, echoed similar sentiments.
According to Maimane, “The GNU is not working for the people but serving politicians. Compounding the issue is a bloated executive, VIP protection, and a R3 billion expenditure. The priority is clearly not on education or economic growth.”
BOSA is now calling for a drastic overhaul. Their proposal includes reducing the number of ministries, cutting perks, and eliminating wasteful VIP expenses. They also want to see underperforming departments merged or disbanded.
“We will continue to fight against such excesses and will ensure that National Treasury is held accountable for these decisions,” Maimane said.