R80 social grant hike not enough to beat skyrocketing food prices in South Africa

 ·24 Apr 2024

The Pietermaritzburg Economic Justice and Dignity Group (PMBEJD) says that the R80 increase in child support grants over the past four years has not been enough to cover the rising cost of living in South Africa.

April marked the start of the government’s new financial year, where various grant changes kicked in, including marginal increases to existing grants, as well as a previously unannounced hike to the Social Distress of Relief (SRD) grant, which jumped from R350 to R370, a month.

One of the most crucial grants in South Africa is the child support grant, which was boosted to R530 a month in April.

However, the PMBEJD said that the R20 increase in child support grants in 2024 is simply not enough to cover the R68 rise in the cost of feeding a child in South Africa in the past year.

Meanwhile, the R80 boost in grants over the last four years falls short of the R200 hike in food costs tracked by the group over the same period.

Worse still, the grant was never enough and continues to fall dramatically short of how much it would cost to feed a child a basic nutritious diet, the group said.

In April 2024, the Child Support Grant of R530 is 30% below the Food Poverty Line of R760 and 45% below the R960 average cost to feed a child a basic nutritious diet.

The PMBEJD said that mothers it surveyed welcomed the extra money even though it was not nearly enough – reflecting the low expectations of the government and the desperate circumstances of many.

The group said that after prioritising burial fees and creche fees, households use the grant to buy what little staple food they can, hopefully leaving room for basics like cooking oil, washing soap, and sugar.

At this point, the grant money is gone.

Rising basket prices

The PMBEJD’s latest food basket data reveals that some pantry essentials, fruits, and eggs are still showing double-digit price increases, indicating the continued rise of food prices in South Africa.

According to the PMBEJD, its household food basket for April 2024 increased to R5,336.31—an increase of R312.36 (6.2%) compared to April 2023. Month-on-month, the basket also pushed higher, with a R58.38 increase (1.1%).

While measuring data a month later than Stats SA’s basket, the 6.2% increase is slightly higher than the latest recorded CPI for food, which came in at 6.1% in February 2024.

The PMBEJD’s basket comprises 44 food items that most households in South Africa would purchase in a typical month. While this basket reflects a lower income, it is what the majority of households would look at.

Across the 44 food items tracked by the group, eight decreased in price year-on-year, with cooking oil (-11%) and maize meal (-7%) seeing the largest price drops. The balance (36 items) increased.

15 food items saw double-digit growth year-on-year, reflecting significant increases – and seven were over 20%:

  • Oranges +34%
  • Sugar Beans +34%
  • Rice: +32%
  • Eggs: +31%
  • Cremora +24%
  • Curry Power +24%
  • Peanut Butter +21%

Consumer inflation increased to 5.6% in February from 5.3% in January and 5.1% in December, according to Stats SA.

The prices of eggs have continued to impact the milk, eggs & cheese category, as they are 30.7% more expensive than a year ago.

Although the current average price of a tray of six eggs (R25.48) is down from its peak in December 2023 (R25.85), it is still higher than the February 2023 price tag (R21.13).

The inflation rate for rice has increased to 25.0% in February from 23.8% in January.

This means that a bag of 1 kg of rice would have cost R31.83 in February, which is significantly higher than the R23.54 price a year ago.

Similarly, pizza and pies, which are categorized with rice under bread and cereals, have also experienced a sharp price increase, rising by 17.5% in the 12 months up to February.

Although the bread and cereals category has experienced an increase in prices, there is still some good news. Some products are actually cheaper than they were a year ago. These include:

  • Bread flour -5.7%;
  • Rusks -2.7%;
  • Ready-mix flour -2.2%;
  • Pasta -2.1%; and
  • Macaroni -0.5%.

Despite the overall increases, Stats SA has reported that food and NAB inflation is slowing, as most categories have recorded lower annual rates, except for hot beverages and oils and fats.

Read: Bad news for chocolate lovers in South Africa

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