Since its initial introduction in 2020, the R350 grant has been a lifeline for millions of South Africans who can barely make ends meet. The grant has been extended to be in place until 2024, as it has become obvious that those who need it would struggle even further without it.
However, despite calls for it to either be increased or remain indefinitely, concerns have been raised over its long-term sustainability among economists and the Treasuring Department. Meanwhile, the current cost of living continues to spiral out of control due to rising inflation.
This has had more of a negative impact on R350 grant recipients who say that although it has made a difference, it is not enough for those in a desperate situation. Additionally, changes in the grant’s regulations of the grant have made it less inclusive compared to its previous cycles according to Neil Coleman from the Institute for Economic Justice.
“In March last year, 10.9 million beneficiaries received the SRD Grant and in January this year, it was only 7.4 million. So you can see that several million people were excluded and that is extremely problematic.” Coleman stated.
Concerning this, the Department of Social Department has stated that it is open to suggestions to the amendments of R350 grant regulations.
In addition to this, the South African Reserve Bank's Monetary Policy Committee increased the repo rate by 50 basis points to 7.75% per year, with effect from the 31st of March 2023 to curb rising inflation
But concerns remain that many recipients of the government's social grants will not able to keep up with the high cost of living. This is despite the R360 billion for the R350 grant extension and a 5% increase in social grants announced by the finance minister, Enoch Godongwana during his 2023 budget speech in February.
However, Economist, Daan Steenkamp from Codera Analytics goes on to say that the country’s current economic outlook cannot accommodate further grant extensions without raising taxes.
