Social Grants – Separating Myths From Facts

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Social grants empower South Africa’s women with greater independence, decision-making power and economic opportunities – and popular opinions that grants promote dependency, discourage work-seeking and encourage teenage pregnancies are not backed up by the facts.

 


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Excluding the Covid-19 Social Relief of Distress grant, more than 18.3 million social grants are paid out each month, including 13.6 million for children and 3.7 million old-age pensions, totalling R193 billion, or 3.1% of GDP.

South Africa’s extensive social grant system not only plays a key role in the government’s anti-poverty fiscal strategy but also contributes to narrowing the gender poverty gap which puts women at greater risk of poverty than men, says Prof Ingrid Woolard, contributor to the 2022 Women’s Report: Women and Fiscal Policy, released by Stellenbosch Business School in partnership with the SA Board for People Practices (SABPP) to mark Women’s Month in August.

In her article she highlights the positive impacts of social grants on women and children, along with dispelling some of the myths and criticisms around grants.

“Many of the arguments against social grants, that they promote dependency and reliance on welfare, discourage job-seeking and increase teenage child-bearing in order to claim the grant, are simply not supported by the evidence," Woolard said.

In fact, numerous evidence-based studies in different fields of research, taken together, show that the small, regular income of the child support grant expands women’s autonomy, choices, dignity and participation in community life. The grant gives women a measure of financial independence and increases her power in household decision-making on spending and children’s well-being.

Grants lift some six million people above the food poverty line (R624) every month and the child support grant is the most effectively pro-poor, benefiting three-quarters of the poorest 10% of South African households.

“The grants play an important role in reducing extreme poverty and ensuring that people are able to eat and obtain basic necessities. They assist women to meet their children’s nutritional needs and keep them in school, improving their future prospects and contributing to breaking the cycle of poverty,” she said.

Early childhood malnutrition contributes to child mortality and stunts children’s cognitive development, leading to lower levels of education, lower earning ability and a repeat of the poverty cycle.

Studies have shown that children have better levels of nutrition in households receiving the old-age grant, especially when the recipient is a woman; and that children who benefit from the child support grant in their first three years of life have significantly higher height-for-age scores (lower scores indicate malnourishment) than those who do not.

Woolard said the child support grant had also been shown to have a positive effect on keeping teenagers in school for longer, with enrolment rates about 10% higher than for those not receiving the grant.

Social grants are, partly by design, paid out mostly to women. Almost all child support grants, some 96%, go to women, usually the biological mother or grandmother, because the design of the grant was led by international empirical evidence that women are more likely to use social assistance cash to buy food and goods to meet children’s needs.

“In addition, more than three-fifths of state old-age pensions are paid to women, due to women tending to outlive men and being less likely to have accumulated retirement savings through formal employment.

“From the evidence, the bias of grants towards women has resulted in both the child support grant and the old-age pension playing a key role in improving South African children’s health and educational outcomes and thus increasing the country’s human capital,” Woolard said.

While critics of social grants argue that they discourage people from looking for work, Woolard said that research had shown that women were much more likely to travel from rural homesteads to urban areas to find work when the household included an old-age grant beneficiary, especially a female pensioner.

“Women are often restricted in searching for jobs by finances and childcare responsibilities, but there is evidence that household receipt of a grant loosens these constraints and increases work-seeking. This is an illustration of women enabling other women to be economically active, and counters the widely-held belief that grants promote dependency and reliance on welfare,” she said.

On the debate whether child support grants encourage teenage pregnancy, Woolard said that Stats SA’s national health and demographic surveys indicated that the number of pregnancies among young women was not increasing, even though the child support grant had been regularly expanded over the past 20 years.

Survey data also indicate that younger mothers are much less likely to apply for the child support grant than older mothers, dispelling the myth that teenage girls are deliberating falling pregnant in order to access the grant.

“There is clear evidence that teenage pregnancies are unplanned and often unwanted, and mostly the result of inadequate sex education, risky behaviour or lack of access to contraceptives,” she said.

Women receiving the child support grant are also more likely to participate in community activities such as stokvels, with positive impacts both on their finances and on social cohesion, encouraging women to support each other, says Woolard.

“While social grants are certainly not a silver bullet for all of South Africa’s challenges of unemployment, poverty and inequality, they are an important part of an overall package of economic support. Beyond the immediate benefits of redistributing cash to society’s most vulnerable, they play a socially transformative and empowering role for women and the next generation,” Woolard said.

 The full report can be viewed here

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