Social Development Minister Lindiwe Zulu has provided more details on the government’s proposed basic income grant (BIG) for unemployed South Africans.
Addressing a media briefing on Monday, Zulu said the grant is aimed at “lifting South Africans out of poverty” in line with the SA Social Security Agency (SASSA) and National Development Agency’s (NDA) mandates.
She explained, “The BIG will be unconditional, individually targeted and at the level that will lift individual South Africans out of poverty. Since we already have categorical grants for children, older persons and persons with disabilities, BIG will be an income support grant for the population aged 18 to 59.”
R350 SASSA SRD grant
The government is currently implementing the R350 SASSA social relief of distress (SRD) grant, which will however run for only six months. The BIG is therefore proposed to continue benefitting SRD grant recipients.
“SASSA has a comparatively well-developed infrastructure that reaches far more people (31.2 percent) than any other agency. Therefore, BIG will result in most of the poorer individuals continuing to access the COVID-19 SRD grant benefits,” Zulu said.
She added that the BIG will be introduced “within our fiscal capabilities” given South Africa’s acute budgetary constraints. It could therefore be phased in incrementally.
“Currently, the most vulnerable groups of our population are the youth between 18 and 24 and the elderly between 50 and 59. Targeting these groups first and then progressively expanding to other age groups may be warranted.
“We are very conscious of the public purse and we are very conscious of the fact that the Minister of Finance [Tito Mboweni] is struggling to get the money,” the Minister said.
She admitted that BIG would most likely be inadequate for individual recipients, but it would be something that they would have as they “look for other opportunities.”
ANC NEC decision
Zulu’s briefing follows a decision by the African National Congress (ANC) National Executive Committee (NEC) earlier this month to look at the grant’s modalities.
“The NEC tasked the Social Transformation Committee and the Economic Transformation Committee to urgently meet and look at the feasibility and detailed modalities of a basic income grant, including costing and financing of this measure, and to report to the Officials and National Working Committee (NWC),” ANC Secretary-General Ace Magashule said.
Citing an ANC discussion document, a Bloomberg report published before the NEC meeting said the party was considering a grant amount of R500.
“COVID-19 has weakened and undermined the resilience and survival strategies of low and no-income households. The social, economic and political costs of not introducing a BIG in South Africa are more disastrous than the actual monetary costs,” the paper reportedly argued.
According to the paper, the BIG would cost the government R197.8 billion per year. It proposed recouping 50-60 percent of this amount from extra taxes on those who are employed.