With just over four weeks to go to General Elections, President Ramaphosa has dangled Universal Income Grant for South Africa, yet again. He addressed COSATU members at a Worker’s Day rally this week, reports Business Tech. In his address, he said a Universal Income Grant for South Africa would be ‘a victory for the country’s working class’.
UNIVERSAL INCOME GRANT FOR SOUTH AFRICA
Clearly on the campaign trail ahead of Wednesday 29 May 2024’s vote, President Ramaphosa brought up the long-talked-about Universal Income Grant for South Africa, yet again. He said, after years of struggle to win the right to a National Minimum Wage, the next target is the Basic Income Grant.
However, as Business Unity South Africa (BUSU) CEO Cas Coovadia so eloquently phrased, there are some ‘harsh truths’ facing the scheme. He spoke at the GroundUp/Black Sash BIG Debate last week. Along with billions in social welfare delivered each month by the South African Social Security Agency, a Universal Income Grant for South Africa would cost 3.8% of national GDP.
POOR FISCAL PLANNING
Therefore, to fund every single unemployed person between the ages of 18 and 59, a significant source of funding is essential. And, as Coovadia says, the state’s own poor fiscal planning and performance is the reason it can’t work. The National Treasury simply cannot afford it, due to our high debt repayments and stagnant economic growth.
However, according to Ramaphosa, he is pushing hard and the battle is close to being won. “When we introduced the R350 SRD grant, it was you, COSATU, who said you want it extended until we get to a Basic Income Grant, And we are well on the way. Urged by yourselves, we will be able to get there soon,” concluded Ramaphosa.
EIGHT-MILLION UNEMPLOYED
According to the latest figures, there are eight-million unemployed people in South Africa’s workforce. This number has been steadily increasing year-by-year since 2013. The recently extended (till March 2025) and increased (to R370) SRD grant has a budget allocation of R33.6 billion in 2024/25.
While not yet confirmed, a provisional allocation for 2025/26 sits at R35.2 billion, which is simply not enough for a Basic Income Grant. Unsurprisingly, Ramaphosa and the National Treasury have shared no concrete plans on what a financing plan will look like. They’re perhaps waiting to see they’ll even be in office in five-weeks’ time to figure it out.
NEXT READ: UPDATED info: May 2024 SASSA Older Persons grants
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