Basic income grant for South Africa is coming

 ·2 May 2024

President Cyril Ramaphosa says that South Africa is on its way to getting a basic income grant, calling it a victory for the country’s working class.

Addressing Cosatu members that the union federation’s Worker’s Day rally on Wednesday (1 May), the president said that workers had fought for income rights and won.

“Today, after years of struggle, you have won the minimum wage. South Africa now has a National Minimum Wage, meaning that we have set a level below which a worker may not be paid—and that right belongs to you, you won that right,” he said.

He added that workers have also been pushing for a basic income grant, and that battle is also close to being won.

Ramaphosa pointed to the R350 social relief of distress (SRD) grant that was doled out to help citizens during the Covid-19 pandemic.

The grant has been extended several times since the end of the pandemic and was hiked to R370 from 1 April.

“When we introduced the SRD grant, the R350, it was you (Cosatu) who said that we want that to be extended until we get to the stage of having a basic income grant, and we are on the way to move in that direction, urged by yourselves, we will be able to get there,” Ramaphosa said.

The president’s latest statements echo the intentions he set out during his February State of the Nation Address.

At the time, he said the SRD Grant would be extended and amended to form part of the Basic Income Grant.

During the 2024 Budget, Finance Minister Enoch Godongwana announced that the SRD grant would be extended to 2025, and the government has provisionally allocated funding for the SRD until March 2027.

The SRD grant was allocated R33.6 billion in 2024/25 (with the hike to R370 later adding about R2.2 billion to that), with provisional allocations of R35.2 billion and R36.8 billion for the 2025/26 and 2026/27 financial years.

Outside of its intent to eventually introduce a basic income grant in South Africa, Ramaphosa and Treasury have been vague on the details and the financing plan.

Godongwana said in March that, if properly managed, South Africa can afford to roll out a basic income grant and that the question wasn’t whether a grant was coming but rather how it would be funded.

The ANC has previously suggested that the grant be funded through a wealth tax, closing tax loopholes, addressing base profit shifting by corporations, and implementing a transactions tax.

Read: Basic income grant for South Africa is coming – it’s just a matter of ‘when’

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