New social grant for South Africa
The Department of Social Development (DSD) hopes to finalise the policy for a new Basic Income Support (BIS) grant by March 2027, getting it ready for implementation.
This would enable the department to initiate the legislative process needed to implement the grant in the next financial year (2027/28).
The BIS is the new social grant the government plans to use to replace the COVID-19 Social Relief of Distress grant, which has been extended far beyond its original intent.
The SRD grant was a R350 per month support grant—later lifted to R370—launched in 2020 during the COVID-19 pandemic to help qualifying South Africans weather the economic uncertainty at the time.
The department noted that the grant was only ever expected to be in effect for six months, but over 8 million recipients became dependent on the support.
This led to the grant being extended annually, costing an additional R35 billion to R40 billion per year to finance.
The grant was allocated an additional R36.4 billion in the 2026 budget to extend payments until 31 March 2027 at the current rate of R370 per beneficiary per month.
Notably, the provision for the SRD grant over the medium term dissipates to 2028/29, where only R1.7 billion and R1.2 billion are pencilled in over the outer years.
The DSD characterised the billions spent on the grant as a “success” because it directly addressed poverty, noting that recipients mainly used the money to buy food, electricity, and clothing.
This, it said, then supported local economies.
“Research by multiple independent researchers also found the SRD grant to be well targeted and successful in reducing hunger, poverty and inequality while also enabling the participation of beneficiaries in job search and other economic activity,” it said.
Because of this, the national government, supported by the presidency, is moving to transform the SRD grant into a new Basic Income Support policy, which is currently being processed.
President Cyril Ramaphosa has long supported the new grant and, in his 2026 State of the Nation Address, promised that the rework of the new grant would happen this year.
Notably, the BIS has almost entirely taken over the talk of a basic income grant in South Africa, which had become an increasingly contentious topic, especially around cost and funding.
New grant still being drafted
The DSD said that the new grant policy is still being drafted, with consultations and inputs from various stakeholders shaping it into something workable.
A draft policy on the BIS was first presented to the cabinet in November 2024, but was sent back to the department to strengthen key provisions.
This includes sections relating to linking the grant to employment-seeking activities, as well as updating the costing of the policy.
In 2025, the department moved to link the grant with employment and sustainable livelihood opportunities, specifically targeting it at the economically active population.
This is so that “the working age population targeted for income support does not only rely on this [grant],” the department said.
“Measures [will be] put in place to ensure that they can be graduated to other economic opportunities.”
The department said that research and additional work commissioned over the past year was completed in February 2026, with the policy updated to reflect this.
It also now includes the institutional design for the linkage strategy.
The DSD and the presidency presented the updated policy to the National Treasury in March and held workshops with other government departments in May.
With these additional inputs, the revised draft will be presented to the National Treasury in the “next few weeks”, the department said.
From this point, the DSD outlined the next steps to implement the new social grant, with the legislative process only expected to start in 2027.
Next steps for the new social grant
- June/July 2026: finalise engagements with National Treasury
- July 2026: Update draft policy and submit impact assessment for consideration by the presidency
- August 2026: Submit draft policy to cabinet and request approval to gazette for public comment
- September 2026-February 2027: Update draft policy with new inputs
- March 2027: Submit policy to cabinet for final approval
The department said that, should the policy be taken through all government processes, it will draft relevant amendments to the Social Assistance Act to facilitate its implementation.
The legislative process is expected to commence in the 2027/2028 financial year—a relatively tight deadline.
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