President Cyril Ramaphosa aims to create a permanent Basic Income Grant (BIG) by improving on the existing Social Relief of Distress (SRD) Grant to enhance support for the unemployed.
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The president announced this plan during the 2024 State of the Nation Address.
‘We have seen the benefits of this grant and will extend it and improve it as the next step towards income support for the unemployed,’ he said.
As per BusinessTech, the R350 SRD grant was introduced during the COVID-19 pandemic. It currently supports nine million unemployed people each month and is one of the only sources of financial support for those struggling to find work.
The country’s unemployment rate of 31.9% is among the highest in the world.
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The president also dismissed the critique that the grant has been establishing a ‘dependent society’, noting that it serves to ‘protect the unemployed from the threat of poverty’.
However, details on exactly how the BIG would come to pass have not been revealed yet.
Lindiwe Zulu, the minister of social development, stated that funding models are being explored for the proposed BIG.
These include:
- An increase in taxation
- The reallocation of current budget allocations
- Borrowing
The Department of Social Development recently allocated 96.4% of its R263 billion for grants. This amounts to a total of R253 billion allocated for the 2023/24 financial year for direct cash transfer payments.
Furthermore, R36 billion has been used to fund the extension of the COVID-19 SRD grant until 31 March 2024.
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Picture: The Presidency of the Republic of South Africa / Facebook