President Cyril Ramaphosa confirmed that the Social Relief of Distress (SRD) grant will form the basis for a sustainable income support system.
The SRD grant was introduced during the COVID-19 pandemic, when lockdowns left unemployed individuals with virtually no means of finding work. Although lockdowns have ended, the SRD grant has been extended several times.
Currently, it is the only financial support for unemployed people in South Africa. However, its implementation could end in March 2025.
The Department of Social Development faces a budget cut of approximately R20 billion, leading many stakeholders to fear this could mean the end of the SRD grant.
The government previously indicated provisional SRD grant allocations for the 2025/26 and 2026/27 financial years, which could result in further extensions.
However, during the 2024 Medium Term Budget Policy Statement (MTBPS), Finance Minister Enoch Godongwana suggested the government might prioritise job creation over extending the grant.
Over the next three years, 30.6% of the population will receive some form of social grant, excluding the COVID-19 social relief of distress grant. The government will also spend R3.4 billion on job creation initiatives in 2024/2025.
Pivot to Job Creation and Skills Development
Andrew Levy, economist and Head of Human Capital at Afrika Tikkun, says the grant should be linked to skills development programmes.
He argues that while the SRD grant has alleviated extreme poverty, unemployment has increased. This suggests the government is spending more on the grant than it is receiving in return.
We would like to see investment in human capital, which enriches individuals, increases their value to themselves, enables them to earn a better income, makes them more desirable in the labour market, and adds to the national stock of human capital.
Afrika Tikkun’s proposal emphasises three key strategies: civic engagement, part-time employment, and skills development.
The National Service Programme for Youth focuses on civic engagement through community projects such as waste management and infrastructure maintenance. Part-time employment is linked to grants to instil purpose and stimulate local economies.
Skills development initiatives, such as training programmes and apprenticeships, could foster self-sufficiency and empower young people as active economic contributors.
We need to scale payments and link qualifications to them. While recipients are registered for the grant, we can offer incentives to improve their own condition.
Mr Levy believes that increasing beneficiaries’ dignity and self-worth will motivate them to achieve more.
He acknowledged that initiatives like part-time work require collaboration with employers and legislative considerations. "If we work with employers and understand their needs, we can meet them."
