SASSA R370 SRD grant: Millions at risk as ‘we don’t have the money’
· The South African
South Africa’s struggling economy may not be able to sustain the Social Relief of Distress (SRD) grant in its current form, economists have warned, as pressure mounts on government to expand support for millions of unemployed people.
The R370-a-month SRD grant is currently paid to approximately 8.3 million people, costing the state just under R40 billion a year.
Visit truewildgame.online for more information.
As per the SABC, economists argue that with economic growth remaining subdued and government already facing significant fiscal pressures, there is little room in the budget to accommodate a substantially expanded grant.
The issue was once again thrust into the spotlight on Tuesday when the Supreme Court of Appeal heard an appeal concerning a High Court ruling that found aspects of the SRD grant system unconstitutional because millions of potentially eligible people had been excluded.
While other social grants received increases, the SRD grant was notably left unchanged.
Government is challenging the court’s ruling as it weighs the financial implications of maintaining and potentially expanding the grant.
Where will the money come from?
Citibank economist Gina Schoeman questioned how government would fund the grant if it continues in its current form or is expanded.
“The grant is R370 per month. About 8.3 million people get that, so that works out to a bit under R40 billion … nothing to spare in the budget,” Schoeman said.
The debate comes as government considers ways of linking the SRD grant to skills development and employment opportunities, rather than allowing recipients to remain dependent on the grant indefinitely.
Economist Xhanti Payi of Inani Strategies supported the idea of using the grant as a pathway into employment and productive economic activity.
He referred to former Statistician-General Dr Pali Lehohla, who has previously argued that the grant risks becoming a trap if it does not help people transition into sustainable employment.
The proposal would see social assistance work more closely with skills-development programmes and other initiatives aimed at helping unemployed South Africans enter the labour market.
“If we can use it as a bridge between people who are unemployed and struggling and how we get them to be productive and employed, overcoming some of those structural issues, that has to meet other programmes including the skills programme,” Payi said.
He argued that the effectiveness of programmes such as the Sector Education and Training Authorities (SETAs) also needs to be reassessed as part of a broader strategy to move people from welfare into work.
‘We have a moral obligation’
Efficient Group economist Dawie Roodt agreed that an extended SRD grant would be difficult to finance without government reprioritising existing expenditure.
Roodt blamed what he described as poor economic policies for contributing to South Africa’s persistently high levels of unemployment and poverty.
However, he also stressed that the country has a responsibility to support people who are struggling.
“We have reached the point where approximately 30 million people and probably more now, depending on what the court decides, means that nearly 50% of the South African population depends on the state through an income that is totally unsustainable.”
According to Roodt, the long-term solution cannot simply be to expand social grants.
Instead, he argued that South Africa needs significantly stronger economic growth to create jobs and reduce dependence on the state.
“The only solution is to grow the economy,” Roodt said.
The debate over the future of the SRD grant therefore presents government with a difficult balancing act: providing a safety net for millions of vulnerable South Africans while ensuring that social spending remains financially sustainable.
With the courts now considering the future of the grant’s eligibility framework, the outcome could have significant implications for both millions of beneficiaries and the national budget.