Government needs to walk the talk on income support and that means the whole-of-government

The Institute for Economic Justice (IEJ) calls for the South African government to transition from the temporary Social Relief of Distress (SRD) grant to a permanent basic income support system. The author argues that while President Cyril Ramaphosa has committed to this goal, the National Treasury's fiscally conservative approach and 'technocratic machinery' threaten to undermine the policy through restrictive eligibility, low grant levels, and the blocking of social security reforms. The IEJ suggests that increasing the grant to R500 per month for 13.4 million people would be affordable using tax overruns, and proposes alternative financing mechanisms such as a social security tax, financial transactions tax, and resource rent tax to avoid reliance on VAT or personal income tax increases.

• President Cyril Ramaphosa announced the extension of the Social Relief of Distress (SRD) grant for one year and committed to finding a sustainable income support replacement, noting that job creation will take years to reach the 11 million unemployed South Africans.
• The transition to permanent income support faces a tight timeline; major decisions must be made by June or July 2022 to avoid a policy gap when the SRD grant expires in March 2023, which could lead to social instability similar to the July 2021 looting.
• The current SRD grant of R350 is described as an arbitrary and low amount not linked to poverty measures; the author claims that increasing it to R500 per month for 13.4 million people (75% of potential beneficiaries) would cost R80-billion per annum, which is less than half of anticipated tax overruns.
• The SRD grant rollout has been plagued by exclusions, with approximately 4.7 million applications rejected as of February 1, 2022, often due to faulty PAYE and UIF databases.
• The IEJ proposes several creative financing options for permanent income support to avoid the 'fear-mongering' regarding VAT and personal income tax (PIT) increases, including a social security tax, a financial transactions tax, and a resource rent tax.
• The National Treasury is accused of using its control over the public purse to veto social security policies for two decades, including blocking the 2003 Taylor Committee's basic income proposal and forcing the withdrawal of a DSD Green Paper.

APA

Coleman, N. (2022). Government needs to walk the talk on income support and that means the whole-of-government. Institute for Economic Justice. https://iej.org.za/press-room/in-the-media/government-needs-to-walk-the-talk-on-income-support-and-that-means-the-whole-of-government/

Chicago

Coleman, Neil. Government needs to walk the talk on income support and that means the whole-of-government. Institute for Economic Justice, 2022. https://iej.org.za/press-room/in-the-media/government-needs-to-walk-the-talk-on-income-support-and-that-means-the-whole-of-government/.

Wikipedia

{{cite press release |last1=Coleman |first1=Neil |title=Government needs to walk the talk on income support and that means the whole-of-government |publisher=Institute for Economic Justice |date=22 February 2022 |url=https://iej.org.za/press-room/in-the-media/government-needs-to-walk-the-talk-on-income-support-and-that-means-the-whole-of-government/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{coleman2022government, author = {Coleman, Neil}, title = {{Government needs to walk the talk on income support and that means the whole-of-government}}, publisher = {Institute for Economic Justice}, year = {2022}, month = feb, url = {https://iej.org.za/press-room/in-the-media/government-needs-to-walk-the-talk-on-income-support-and-that-means-the-whole-of-government/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }