Can a universal basic income contribute to breaking structural poverty in South Africa?

The document compiles research on the impacts of Universal Basic Income Grants (UBIG) and cash transfers, focusing on their ability to reduce poverty, improve health, and empower women in South Africa and other low-to-middle-income countries. It challenges myths regarding welfare dependency, arguing that such grants often facilitate job searches and productive investments rather than discouraging work. The bibliography also examines the macroeconomic feasibility of UBIG through progressive taxation and the social benefits of universality over targeted assistance.

• A Basic Income Grant (BIG) in South Africa could significantly reduce extreme poverty; if perfectly implemented, it would reduce the Food Poverty Line poverty gap by over 70% at an annual cost of R60 billion.
• Evidence from South Africa and other developing nations refutes the stereotype that cash transfers create a 'dependency culture' or discourage paid employment. Instead, grants often help job seekers cover the costs of searching for work, such as data, transport, and application fees.
• Cash transfers have positive effects on mental health and child development in South Africa. Specifically, the child support grant has been shown to lower the risk of adolescent depression by 12 percentage points for maternal depression and 25 percentage points for paternal depression.
• UBIG can promote women's economic empowerment and reduce intimate partner violence (IPV). In a study from Kenya, transfers paid to both men and women significantly reduced IPV, with sexual violence specifically reduced when women received the transfer.
• Universal grant systems are more effective and efficient than targeted programs. Targeting often leads to 'errors of inclusion and exclusion' and can create community jealousy and animosity, whereas universality supports social cohesion.
• A UBIG in South Africa is considered fiscally feasible through the phased-in introduction of progressive taxation. Proposed mechanisms include a social security tax, resource rent tax, luxury VAT, carbon tax, and wealth and property taxes.
• In South Africa, digital financial systems used for cash transfers have been exploited by private corporations. For example, the provider Net1 used recipient data to encourage loans, using grants as collateral and making the system a 'site of nearly risk-free profit' for the company.

APA

Mahafu, V., Mncube, Z., & Howson, K. (n.d.). Can a universal basic income contribute to breaking structural poverty in South Africa? Institute for Economic Justice. https://iej.org.za/wp-content/uploads/2022/11/Annotated-Bibliography-basic-income-structural-poverty-SA.pdf

Chicago

Mahafu, Vuyisiwe, Zimbali Mncube, and Kelle Howson. Can a universal basic income contribute to breaking structural poverty in South Africa? Institute for Economic Justice, n.d. https://iej.org.za/wp-content/uploads/2022/11/Annotated-Bibliography-basic-income-structural-poverty-SA.pdf.

Wikipedia

{{cite report |last1=Mahafu |first1=Vuyisiwe |last2=Mncube |first2=Zimbali |last3=Howson |first3=Kelle |title=Can a universal basic income contribute to breaking structural poverty in South Africa? |publisher=Institute for Economic Justice |url=https://iej.org.za/wp-content/uploads/2022/11/Annotated-Bibliography-basic-income-structural-poverty-SA.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{mahafundcan, author = {Mahafu, Vuyisiwe and Mncube, Zimbali and Howson, Kelle}, title = {{Can a universal basic income contribute to breaking structural poverty in South Africa?}}, institution = {Institute for Economic Justice}, url = {https://iej.org.za/wp-content/uploads/2022/11/Annotated-Bibliography-basic-income-structural-poverty-SA.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }