Ramaphosa doubles down on Basic Income Grant

Ramaphosa doubles down on Basic Income Grant for South Africa

President Cyril Ramaphosa has doubled down on plans to make the shift to a permanent Basic Income Grant a reality in South Africa.

Delivering the 2024 State of the Nation Address, the president said that this will be done by extending and amending the Social Relief of Distress [SRD] Grant.

“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,” said Ramaphosa.

The R350 SRD grant was introduced during the Covid-19 pandemic which Ramaphosa said currently supports 9 million unemployed people monthly. However, the Basic Income Grant is said to increase and expand on this.

The SRD is currently one of the only sources of financial support for millions of South Africans who are unable to find employment. South Africa’s unemployment rate of 31.9% is one of the highest in the world.

Ramaphosa went on to dismiss the critique that the grants have been establishing a “dependent society” – saying that it rather serves to protect the unemployed from the threat of poverty.

However, no concrete plans or details on the grant have been presented yet. Further details are expected to emerge during the 2024 Budget Speech.

Recently, Minister of Social Development Lindiwe Zulu said that funding models being explored for the proposed Basic Income Grant are between:

  • An increase in taxation;
  • Reallocation of current budget allocations;
  • Borrowing

Currently, the Department of Social Development has allocated 96.4% of its R263 billion for grants; meaning R253 billion has been allocated in the 2023/2024 financial for direct cash transfer payments. R36 billion has been used to fund the extension of the Covid-19 SRD grant until 31 March 2024.