Government is looking at a new basic income grant for South Africa

The Department of Social Development says that the introduction of the R350 Covid-19 Social Relief of Distress (SRD) grant has revived discussions of a basic income grant in South Africa.

Presenting in a parliamentary committee meeting on Wednesday (6 July), the department that the SRD Grant will be paid for six months, but the demand for income support for the unemployed and those who have lost their jobs will go beyond this period.

“To address this, the Department is working on policy proposal on the feasibility of income support to South Africans between the ages of 18-59 who have no income support.

“This is a result of the introduction of the Special Covid-19 SRD grant that has revived the discussion of the feasibility of a Basic Income Grant (BIG) as was recommended by the Taylor Report in 2002,” the department said.

The department did not comment on when it plans to introduce the grant or how much will be offered as part of financial packages.

Proposals

The ruling ANC has said that it will also look at the feasibility of introducing a basic income grant as part of a series of outcomes decided upon by its National Executive Committee (NEC).

The committee, which held a virtual meeting at the end of June, met virtually to discuss a range of issues including the party’s response to the coronavirus pandemic.

Following the meeting, secretary-general Ace Magashule said that the party’s social and economic transformation committees will meet to look at the feasibility of a basic income grant, including its costing and financing.

He noted that while government introduced specific measures to help South Africans during the coronavirus pandemic, the country still needed further support structures.

“Although these measures made a difference, given the devastating economic impact expected as the pandemic unfolds, we must look at additional measures to broaden the social safety net and provide for the dignity of all South Africans,” Magashule said.

According to a document seen by Bloomberg, the ANC proposes paying a R500 monthly grant to those aged 19 to 59 who aren’t normally eligible for other aid would cost the state R197.8 billion a year. Between 50% and 60% of the money could be recouped by levying extra taxes on those with jobs, it said.