The introduction of a permanent Basic Income Grant (BIG) for South Africa has been penciled in, beginning from next year (2023). The focus now shifts to how the grant will be designed and implemented.
The Basic Income Grant would be implemented to provide financial assistance to those aged between 18 and 59 years old, who are unemployed. Recipients of the grant would receive R624, an amount which matches the food poverty line.
The African National Congress (ANC) has stated its support for the BIG's introduction, stating, “All people should receive unconditional basic income to meet their basic needs indexed to the food poverty line. Government should continue to pay the Social Relief of Distress grant of R350 until the introduction of [the BIG]."
The idea of a permanent social assistance grant in South Africa was cooked up following the implementation of the Social Relief of Distress grant (SRD grant) to help alleviate the effects of the Covid-19 pandemic on the country’s poorest citizens.
Civil society groups have urgently called for President Cyril Ramaphosa and the National Treasury to implement the permanent income support for adults, as millions of South Africans are living below the poverty line and unemployment across the country continues to climb.
Ramaphosa has received warnings from his own council regarding the potential damaging impact the BIG might have on South Africa's economic growth and job creation, calling it too much of a risk.
However, economist and financial journalist, Duma Gqubule, says the implementation of the BIG will not take away from the economy, but will be a positive injection.
"Nothing is affordable in the context of the current macroeconomic policy framework because our economy, if you look at GDP per capital over the last 15 years, it hasn't grown. Over the past 28 years, it's grown by 20.5%, so now within the current framework, what we have is record unemployment, poverty and inequality," said Gqubule.
While implementing the Basic Income Grant will definitely benefit its recipients, many are wondering if the South African Social Security Agency (Sassa) and the Department of Social Development will be able to afford it, especially since the Agency has been struggling to provide recipients of the current R350 grant with the money they are owed.
The ANC party found that Government should come up with a financing strategy within 12 months.
