Finance Minister Enoch Godongwana says the government will roll out a basic income grant as soon as resources become available.
Finance Minister Enoch Godongwana says the question is not whether South Africa should have a basic income grant but rather how it will be funded.The 2024 budget revealed that South Africa is planning to spend R266.21 billion on social grants in the financial year 2024/25, which is equivalent to 3.6% of the country’s GDP.
Despite this, the government chose to increase grants across the board for 2024/25 – including old age, foster care, and child support grants. The grant’s introduction and subsequent extension led many to believe it would be used as the basis for introducing a permanent BIG. The party suggested the grant would be funded through a wealth tax, closing tax loopholes, addressing base profit shifting by corporations, and implementing a transactions tax.
There are concerns about the feasibility of the government’s plan to provide the Social Relief of Distress grant. “Government is still discussing options for a replacement grant and the balance between policy options to support higher employment,” it said. study from July 2022 found that, while the grant will improve inequality, “any attempts to expand the budget with the status quo environment will damage debt dynamics further”.
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