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Eyewitness News
a day ago
- Business
- Eyewitness News
Human rights organisation, COSATU and economists debate future of social grants
South Africa's economy is not creating enough jobs, so what happens to the millions of people who currently rely on social grants? This was the question raised by activists, economists and labour leaders at a panel discussion hosted by the Black Sash in Cape Town on Wednesday. The event was part of the organisation's 70th anniversary celebrations, and looked at the impact of removing social assistance in a country with high youth unemployment, food insecurity and growing inequality. The General Household Survey released by Statistics South Africa (StatsSA) on Tuesday, shows that the proportion of people receiving social grants grew from about 13% in 2003 to 31% in 2019 and surged to 40% in 2024 'due to the introduction of the special Covid-19 Social Relief of Distress (SRD) grant'. Rachel Bukasa, Executive Director of Black Sash, said social grants are not a luxury, but a necessary response to high unemployment and poverty. 'Grants are an important stop-gap to the poverty and unemployment that exists. One of the biggest misconceptions when we talk about grants is that we don't want people to work. When we call for grants, it's in the absence of the jobs that the government has promised year after year.' She said while job creation remains the goal, the economy doesn't offer enough work for those who need it. Bukasa dismissed claims that grants breed dependency, saying they are a vital safety net while the government works to improve the job market. COSATU's Tony Ehrenreich agreed with Bukasa. He said the alternative to social support from the state is people falling into hunger and desperation. 'Grants are only a requirement when the market has failed. If the market is perfect there will be no need for grants, but the market is not perfect so we need to take care of people in the interim … It's not a question of jobs or grants. It's both,' Ehrenreich said. StatsSA reported that the official unemployment rate stood at about 33% in the first quarter of 2025. The expanded unemployment rate, which includes discouraged job seekers, is 43%. Ehrenreich said these statistics show the current economic direction is not working. 'We can say the system has failed if we look at the unemployment rate and deepening inequality … Must poor people pay for the failure of the rich and the public policymakers who drive around in their fancy cars? That can't be the response.' But political economist Phumlani Majozi said the current grant system is putting too much pressure on the country's fiscus. 'South Africans agree that the best way to move forward as a society is for people to have jobs … In our budget, the social grant expenditure is massive. 65% of our expenditure goes towards social grants, subsidised housing etc … Fiscally, it's not something that is manageable.' He criticised the lack of government vision. 'Where is the plan from the president and his cabinet to say by a certain year these are the targets … It doesn't seem like Enoch Godongwana has a plan.' Majozi said the system discouraged reform. 'There will be no incentive for government to change and pursue policies to encourage economic growth if our first argument is that we need social grants.' To which Bukasa responded that social security is a right, not a favour. 'Social assistance is protected by the Constitution. So we need to do away with the notion that it's a favour the government is doing … The fact that we have high needs for social protection right now is a reflection of governments inability to deliver on job creation.' This article first appeared on GroundUp. Read the original article here.
IOL News
3 days ago
- Business
- IOL News
Straining to support: South Africa's social grants are vital but can the state keep up?
Economic challenges and the future of social grants in South Africa Image: Tracy Adams Social relief of distress, or social grants, is a key part of South Africa's welfare system; however, recent data indicates that its role is increasingly strained, raising concerns about sustainability, economic growth, and social cohesion. According to the latest General Household Survey released by Statistics South Africa (Stats SA), an unprecedented 40.1% of the population - approximately 25.4 million individuals-now rely on social grants. This marks a significant increase from previous years and reflects a steady rise in dependence, particularly amid persistent unemployment and economic challenges. Risenga Maluleke, Statistician-General of South Africa, noted that the country's official unemployment rate hit 32.9% in the first quarter of 2025. Such figures highlight the stark depth of economic hardship many face, with social grants serving as a vital safety net without sufficient employment opportunities. Paul Maritz, Director at Free SA, a foundation advocating for rights, equality, and systemic reform, highlighted the gravity of this dependence. 'The growing reliance on social grants - now affecting over 25 million people — highlights deep socio-economic challenges and the urgent need for structural change,' he explained. 'Our proposed Power to the People Amendment aims to address these issues by reducing waste, devolving policing, and breaking monopolies that hinder economic opportunity.' Maritz warned that 'sustained dependence on grants without parallel investment in job creation risks entrenching a welfare economy that stifles individual potential and hampers long-term growth.' He warned that if current trends persist, South Africa's economy could face stagnation, shrinking tax bases, and rising inequality-all threatening social stability. The fiscal burden of social grants is significant. In 2011, the South African government allocated around 3.5% of GDP to social assistance, which has grown over the years. The Centre for Global Development estimated that expenditure on social grants, particularly the Child Support Grant (CSG), reached nearly ZAR31 billion (approximately US$4.2 billion) in 2010-11. Instead, they argued that they serve as a necessary-but insufficient-measure to support those unable to provide for themselves. "While grants have helped improve food security, children's well-being, and school attendance,' Maritz warned that they are not a long-term solution to poverty. 'Overdependence can distort labor markets. When social assistance becomes a substitute for employment, it can disincentivize active job-seeking and skills development. 'Countries with more developed economies often implement prerequisites or conditions tied to grants, encouraging recipients to pursue upskilling or community participation.' He added that the current approach risks creating a stagnating workforce and reducing overall productivity in South Africa, thereby hindering economic growth and perpetuating inequality. 'Ironically, the system designed to reduce inequality may inadvertently reinforce it if not paired with empowerment strategies. 'Without access to meaningful employment, quality education, and secure communities, social mobility remains elusive for many beneficiaries.' Furthermore, dependence on grants without addressing the root causes-unemployment, corruption, and inefficient public services-could erode trust in institutions. Maritz warned that 'a society where millions feel trapped and unheard is inherently unstable,' stressing the need for comprehensive reforms.
IOL News
3 days ago
- Business
- IOL News
Welfare State? Concerns grow over South Africa's unsustainable rising dependence on social grants
Economic challenges and the future of social grants in South Africa Image: Tracy Adams Social relief of distress, or social grants, is a key part of South Africa's welfare system; however, recent data indicates that its role is increasingly strained, raising concerns about sustainability, economic growth, and social cohesion. According to the latest General Household Survey released by Statistics South Africa (Stats SA), an unprecedented 40.1% of the population - approximately 25.4 million individuals-now rely on social grants. This marks a significant increase from previous years and reflects a steady rise in dependence, particularly amid persistent unemployment and economic challenges. Risenga Maluleke, Statistician-General of South Africa, noted that the country's official unemployment rate hit 32.9% in the first quarter of 2025. Such figures highlight the stark depth of economic hardship many face, with social grants serving as a vital safety net without sufficient employment opportunities. Paul Maritz, Director at Free SA, a foundation advocating for rights, equality, and systemic reform, highlighted the gravity of this dependence. 'The growing reliance on social grants - now affecting over 25 million people — highlights deep socio-economic challenges and the urgent need for structural change,' he explained. 'Our proposed Power to the People Amendment aims to address these issues by reducing waste, devolving policing, and breaking monopolies that hinder economic opportunity.' Maritz warned that 'sustained dependence on grants without parallel investment in job creation risks entrenching a welfare economy that stifles individual potential and hampers long-term growth.' He warned that if current trends persist, South Africa's economy could face stagnation, shrinking tax bases, and rising inequality-all threatening social stability. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ The fiscal burden of social grants is significant. In 2011, the South African government allocated around 3.5% of GDP to social assistance, which has grown over the years. The Centre for Global Development estimated that expenditure on social grants, particularly the Child Support Grant (CSG), reached nearly ZAR31 billion (approximately US$4.2 billion) in 2010-11. Instead, they argued that they serve as a necessary-but insufficient-measure to support those unable to provide for themselves. "While grants have helped improve food security, children's well-being, and school attendance,' Maritz warned that they are not a long-term solution to poverty. 'Overdependence can distort labor markets. When social assistance becomes a substitute for employment, it can disincentivize active job-seeking and skills development. 'Countries with more developed economies often implement prerequisites or conditions tied to grants, encouraging recipients to pursue upskilling or community participation.' He added that the current approach risks creating a stagnating workforce and reducing overall productivity in South Africa, thereby hindering economic growth and perpetuating inequality. 'Ironically, the system designed to reduce inequality may inadvertently reinforce it if not paired with empowerment strategies. 'Without access to meaningful employment, quality education, and secure communities, social mobility remains elusive for many beneficiaries.' Furthermore, dependence on grants without addressing the root causes-unemployment, corruption, and inefficient public services-could erode trust in institutions. Maritz warned that 'a society where millions feel trapped and unheard is inherently unstable,' stressing the need for comprehensive reforms.
eNCA
3 days ago
- Business
- eNCA
Over 50% of householes benefit from grants
JOHANNESBURG - Dependence on government support has expanded dramatically over the past two decades. The share of individuals receiving social grants climbed from 12.8% in 2003 to 30.9% by 2019, before spiking to 40-point-1-percent last year. This sharp rise is largely attributed to the Covid-19 Social Relief of Distress grant. It was introduced as a temporary measure, but has since become a lifeline for millions facing unemployment and rising living costs. According to the latest General Household Survey released by Statistics South Africa, the proportion of households receiving at least one grant increased from 30.8% in 2002 to over 50% last year.
IOL News
3 days ago
- Business
- IOL News
Over 25 million South Africans depend on social grants amid rising poverty
Stats SA's statistics show that a staggering 25.4 million South Africans rely on social grants. Image: Independent Newspapers Archives The latest General Household Survey (GHS) released by Statistics South Africa has revealed that a staggering 25.4 million South Africans, or 40.1% of the population rely on social grants for survival. The GHS shows that 50.4% of all households in the country receive at least one form of social grant, making grants the second most important source of income after salaries. In some of South Africa's poorest provinces, more households depend on grants than on salaries. 'A larger percentage of households received grants compared to salaries as a source of income in five provinces: Eastern Cape (65.6% versus 49.0%), Free State (64.2% versus 54.6%), Limpopo (62.9% versus 50.4%), Northern Cape (64.0% versus 60.5%) and Mpumalanga (59.1% versus 56.8%),' Stats SA reported. In response to the rising numbers, Evashnee Naidoo from Black Sash said: 'The increase in poverty, unemployment and inequality increases month-on-month in South Africa due to poor economic growth and limited to no employment opportunities, particularly for those aged 18–59. As we know, the highest rate of unemployment is for the age group 18–35, where the government has also failed to provide an adequate social security safety net to protect and cushion individuals adequately from birth to death.' Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad Loading With the government adopting austerity budgeting, Naidoo warned that 'spending on social spending is decreasing at an alarming rate. Black Sash calls on the government to end austerity budgeting and rather prioritise social spending so that it firms people living in South Africa and allows economic growth to flourish in communities,' she said. Naidoo said access to grants also remained an issue. 'Access to pay channels, as well as government institutions for recourse are particular challenges in the administration of grants, particularly in peri-urban and rural areas, where beneficiaries are shunted from pillar to post.' Black Sash said it would continue to call for permanent Basic Income Support for those aged 18–59 years. 'This would ensure dignity to our people and provide a secured source of income to individuals and households,' Naidoo said. THE MERCURY
