{"id":533572,"date":"2021-10-31T07:52:19","date_gmt":"2021-10-31T05:52:19","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=533572"},"modified":"2021-10-31T07:52:19","modified_gmt":"2021-10-31T05:52:19","slug":"proposed-new-grant-for-south-africa-under-question-report","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/533572\/proposed-new-grant-for-south-africa-under-question-report\/","title":{"rendered":"Proposed new grant for South Africa under question: report"},"content":{"rendered":"

Finance minister Enoch Godongwana will propose that the Covid-19 social relief of distress grant be terminated and replaced with a ‘family grant’, the City Press<\/a><\/strong> reports.<\/p>\n

The new grant, set to be outlined in Godongwana’s first medium-term budget policy statement (MTBPS) on 11 November, would only be given to the head of a family household instead of individuals.<\/p>\n

However, the implementation of this new grant is reported to be a point of contention between Godongwana and president Cyril Ramaphosa, as it would exclude most of those who currently qualify for the R350 social relief of distress grant – a temporary provision of assistance intended for persons in such a dire material need that they are unable to meet their families\u2019 most basic needs.<\/p>\n

An estimated nine million South Africans currently collect the grant, which the president recently extended until March 2022. While a new family grant would significantly reduce the strain on the fiscus, it would also risk alienating a large portion of Ramaphosa’s voter base who would no longer directly benefit.<\/p>\n

The proposed family grant is discussed in the following government document<\/a> made public by GroundUp<\/a>. It is titled \u201cDraft anti-poverty strategy (abridged version)\u201d and it is dated September 2021.<\/p>\n

GroundUp noted that the family grant would only be offered to one million households in the first year, gradually increasing each year by an additional one million households.<\/p>\n

The document, it noted, describes the family grant as the \u201cbest both from an impact perspective as it eradicates extreme poverty, as well as an efficiency perspective\u201d.<\/p>\n

“South Africa\u2019s vision is to eradicate extreme poverty by 2030, which means that no one should live on less than the food poverty line of R624 per month for (2021\/22),” the document said.<\/p>\n

Citing Stats SA data, it points out that 25% of the population live below the food poverty line of R561 per person per month, while 40% live below the lower-bound poverty line of
\nR810, and a further 55% live below the upper-bound poverty line of R1,227.<\/p>\n

Civil society organisations have condemned the proposal, saying it would leave millions of unemployed people worse off than they were before.<\/p>\n

Unemployment and grants<\/strong><\/p>\n

South Africa’s welfare programme has been hailed as the single most significant achievement of the post-apartheid government in reducing income and wealth inequality, which nevertheless remains the world’s highest.<\/p>\n

Unemployment is at a record of more than 34% due to the Covid-19 pandemic, with almost four out of five people aged between 18-24 without work.<\/p>\n

Data published by the World Bank in September shows that a third of South Africans are beneficiaries of a social grant directly, which rises to close to two-thirds when those who benefit indirectly are included. The World Bank recommends the basic income grant take the form of a “jobseekers’ grant, targeted at the unemployed.<\/p>\n

It said that a job-seekers grant, set at R350 a month, could cost R16.2 billion rand a year.<\/p>\n

“The dilemma of the future of South Africa’s social assistance system rests in the opposing pull of these two forces: The limited political appetite for cost-saving reforms and the need to consolidate expenditures,” the World Bank said. “Feasible options for broader reform hence need to balance political will and the need to contain costs.”<\/p>\n

\n

Read: The tiny tax base that’s expected to help fund South Africa’s new basic income grant<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Finance minister Enoch Godongwana will propose that the Covid-19 social relief of distress grant be terminated and replaced with a ‘family grant’, the City Press reports.<\/p>\n","protected":false},"author":10,"featured_media":219297,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11121],"tags":[26],"class_list":["post-533572","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/533572","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=533572"}],"version-history":[{"count":12,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/533572\/revisions"}],"predecessor-version":[{"id":533600,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/533572\/revisions\/533600"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/219297"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=533572"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=533572"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=533572"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}