President Cyril Ramaphosa is expected to announce the extension of the R350 COVID-19 Social Relief of Distress (SRD) grant when he speaks to the country at the State of the Nation Address (SONA) on Thursday, 10 February.
R350 GRANT EXTENSION BEYOND MARCH 2022 ON THE CARDS
In January, Ramaphosa – along with Minister of Social Development Lindiwe Zulu and Finance Minister Enoch Godongwana – met with a collective of civil society groups to discuss the possible extension and improvement of the R350 grant.
The collective, which consisted of Institute for Economic Justice (IEJ), Black Sash Studies in Poverty and Inequality Institute (SPII), #PayTheGrants, and Amandla.mobi, proposed extending the lifespan and eligibility criteria of the grant and increasing its value.
The government said more and more people are dependent on the grant. Since its introduction, its recipients have grown from six million to 10,3 million recipients per month. Treasury said that about 46 percent of the South African population receives some sort of social assistance from the State.
“Research has confirmed the positive impact of this grant in reducing poverty and hunger.
“President Ramaphosa expressed his deep concern around the hardship faced by the more than 13 million unemployed and impoverished people in South Africa and the need for government to protect the dignity of all its people while being mindful of the resource base,” said the Presidency.
The ultimate goal for civil society groups is to make the R350 grant permanent. However, experts believe the president is unlikely to make that move just yet but as so many South Africans are dependent on the assistance its extension beyond March 2022 is all but inevitable.
Trade Unions have also thrown their weight behind a universal basic income grant. In November 2021, ahead of Godongwana’s Medium Term Budget Policy Statement (MTBPS), former Cosatu general-secretary Zwelinzima Vavi called for the government to give unemployed people a R1500 grant in order to help them meet their living needs.
“People are starving and without food. To end this, the state should look to progressively introduce an unconditional universal basic income grant. We need a basic income now for 18 to 59-year-olds who are without a stable income, to receive a basic grant from the state,” said Vavi.
In September, Cosatu called for the government to make the grant permanent and increase it in line with the food poverty line of R624.
According to eNCA, the one-year extension, which is expected to cost the fiscus R35 billion, buys time for the government to assess whether it can afford a permanent social grant
“Deteriorating socio-economic conditions, rising joblessness and more acute inequality in the economy suggest that an SRD extension for another year is a likely minimum requirement for the political economy right now. At a minimum, we expect another year of SRD extension to cost the fiscus R35 billion,” said Jeff Schultz, senior economist at BNP Paribas SA, to BusinessTech.