The Hidden Cost Of Paying Privately For Public Services In South Africa
A household can afford to pay its taxes and still find itself buying essential services all over again. The wider consequences reach beyond family budgets.
A salary increase should, in theory, leave a household with more room to breathe. There might be money available to save, improve a home, take a holiday or invest in
a small business. But for many South Africans, additional income does not necessarily translate into greater financial freedom. It may simply create an opportunity to purchase privately what the public system has failed to provide reliably.
Consider the decisions facing a household that relies on a salary to meet its obligations. Parents may pay school fees because they believe a particular school offers their children better opportunities. A family might maintain medical cover for greater certainty about access to healthcare. Private security, backup electricity and dependable internet connectivity can all become regular expenses. These choices differ across households, and public provision is not uniformly inadequate. Yet the underlying question remains: how much income is left for building financial security once essential needs have been met?
This is the often-overlooked cost of unreliable public provision. Citizens contribute through taxation, but some also spend additional money securing alternatives. The result is not necessarily literal double billing for an identical service. It is a second layer of expenditure that can reduce disposable income and leave families more vulnerable when unexpected costs arise.
The issue becomes particularly revealing when transport is considered. A private vehicle is frequently discussed as a lifestyle purchase, but for some workers it is also a practical response to the limited availability, convenience or reliability of alternative transport. Owning a vehicle can offer independence, yet it comes with financing costs, fuel, maintenance and insurance. A household may therefore be spending heavily just to maintain reliable access to work.
Official statistics illustrate how significant transport already is. Statistics South Africa's Income and Expenditure Survey for 2022/23 found that transport accounted for 15.3% of household consumption expenditure, making it the third-largest spending category. The National Household Travel Survey of 2020 also recorded substantial dependence on minibus taxis and long journeys for many public-transport users. These surveys cover different periods, but together they show why transport deserves attention as an economic issue rather than merely a commuting problem.
There is a further complication: the middle class cannot be defined only by a salary band. Two people earning similar incomes may have very different levels of financial security. One could have manageable housing costs and relatively few dependants. The other might support an extended family, service debt and pay privately for several essential services. Their earnings may look similar on paper, while their ability to save or absorb an emergency differs considerably.
Economist Xhanti Payi raises this wider problem in a CheckPoint: The Podcast conversation with Nkepile Mabuse, describing the middle class as an economic shock absorber. It is a useful metaphor because the pressures do not stop with the individual household. When people devote more income to maintaining basic stability, they have less available for other purchases, investment and supporting new enterprises.
This does not mean that every private alternative is evidence of government failure. Families make choices based on preferences, geography, convenience and affordability. Nor does it mean that public services can be improved simply by increasing expenditure. Reliability, management, maintenance and accountability matter as much as budget allocations.
The practical question for policymakers is what improvements would produce the greatest financial relief for households. A reliable transport system could lower commuting expenses. Better-maintained infrastructure could reduce the need for
private backup services. More dependable public institutions could make some household expenditure a matter of genuine choice rather than perceived necessity.
For households, the measure of economic progress cannot be salary growth alone. It must also include how much of that salary remains available after the essential costs of everyday life have been paid. A stronger middle class is not simply one that earns more. It is one that needs to spend less of its income compensating for systems that ought to work.
References:
· CheckPoint: The Podcast, 14 October 2026. Nkepile Mabuse in conversation with economist and strategist Xhanti Payi. Episode transcript.
· Statistics South Africa. *Transport Month: Key Data and Sector Insights* (2025), drawing on the Income and Expenditure Survey 2022/23.
· Statistics South Africa. *National Household Travel Survey 2020*, published 4 March 2021.
Catch up on all CheckPoint Podcast episodes here: https://www.enca.com/checkpoint-podcast-0