2026/2027 Budget: Gov’t urged to set realistic targets

The Botswana government has been urged to ground its final 2026/2027 budget in realistic projections of revenues, expenditures, and deficits. Keith Jefferis, a Botswana-based economist and Managing Director of Econsult, issued this counsel earlier this week, just days ahead of the 2026/2027 budget speech scheduled for Monday, February 9, 2026. While acknowledging the inherent challenges of forecasting the upcoming budget, Jefferis emphasized the critical need for Finance Minister Ndaba Gaolathe to present a fiscal plan that clearly signals consolidation.

This should be reflected in a reduced budget deficit as a percentage of Gross Domestic Product (GDP), alongside pragmatic revenue and expenditure targets. According to the National Development Plan (NDP 12), the government proposed a development budget of P54.24 billion for the 2026/27 fiscal year. Jefferis contends that this level of planned spending is entirely unrealistic and unlikely to be implemented or financed.

“It is to be hoped that this does not appear in the final 2026/27 budget when it is presented on February 9th,” he stated. Jefferis argues that a sustainable overall budget for the 2026/27 financial year realistically cannot accommodate development budget financing exceeding roughly P17 billion unless recurrent expenditures are significantly curtailed through workforce reductions. He further critiques assertions by various politicians and commentators advocating for a larger share of the budget to be allocated to development projects as uninformed and lacking logical foundation.

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“Budgetary arithmetic makes it clear that, over time, the proportion of the budget devoted to recurrent spending has to rise and that for development spending to fall, if only because every development project generates new, permanent recurrent spending commitments.” He advises that instead of expanding the development budget, the government should concentrate on high-return projects through rigorous project appraisal, as outlined in the Budget Strategy Paper. This approach, Jefferis explains, is essential for budget sustainability and economic growth. Development spending must shrink in size while becoming more effective, generating greater socio-economic returns with less financial outlay.

There are widespread concerns about the inefficiency and wastefulness of Botswana’s development expenditure, with substantial funds allocated to projects that yield low returns and minimal economic impact. In Econsult’s recent economic review for the fourth quarter of 2025, the firm recommended that the 2026/2027 budget align with fiscal sustainability by achieving a deficit well below 5 percent of GDP. “This requires that spending is held at the estimated level it has been over the past three years, in the range of P85–P90 billion.

Anything beyond this, or a larger deficit, would indicate that commitments to fiscal sustainability are not being upheld.” The report cautions that even a single year with a large deficit of approximately 9 percent or more would push the country beyond the statutory debt ceiling of 40 percent of GDP. The government is further advised to continue rationalizing its expenditures beyond recent measures, which have included trimming relatively small categories such as travel and overtime, reducing the issuance of government purchase orders that build arrears, and postponing some new development projects. Some analysts argue these measures fall short of a long-term solution and recommend more comprehensive budget rationalization strategies. These include reducing the government wage bill, refining social spending through better targeting, and sharpening the focus of the development budget on high-impact projects that can genuinely drive economic growth.

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