Minister of Social Development Sisisi Tolashe believes that economic growth could lead to a decline in the number of people relying on the Social Relief of Distress (SRD) Grant.
The Minister was responding to questions in parliament about the long-term sustainability and potential expansion of social protection programmes including the SRD grant.
The SRD grant was introduced to assist unemployed people during the Covid-19 pandemic where their prospects of finding employment was extremely low. While initially only meant to be implemented for three months, the grant’s implementation was extended on several occasions and continues to support millions of unemployed people living in South Africa.
However, in recent months, the affordability and sustainability of the SRD grant has been placed under the spotlight.
The Department of Social Development is staring down a major budget cut of approximately R20 billion. Many stakeholders fear that this could spell the end of the SRD grant.
The government previously indicated that there are provisional allocations for the SRD grant for the 2025/26 and 2026/27 financial years which could result in an extension to its implantation.
However, during the Medium Term Budget Policy Statement (MTBPS), Finance Minister Enoch Godongwana indicated that the government may pivot to job creation instead of extending the grant.
Over the next three years, 30.6% of the population will receive some form of social grant. And this is… excluding the Covid-19 social relief of distress grant. The government will also spend R3.4 billion on job creation initiatives in 2024/2025.
Sustainability of The SRD Grant
The DSD said it's important to distinguish between affordability—ensuring sufficient budget allocations—and sustainability, which considers long-term economic growth alongside social, environmental, and cultural impacts.
They believe that the SRD grant, currently set at R370 per month, can be sustainable if gradually increased as fiscal space permits.
Additionally, leveraging the SRD grant’s database to connect recipients with employment opportunities forms a crucial part of the strategy. As the economy improves, the anticipated creation of jobs will increase tax revenues and reduce reliance on the grant.
As the economy improves, it is expected that this will create more jobs, thus simultaneously increasing the number of income tax payers while reducing the number of individuals requiring the SRD grant.
The DSD confirmed its intent to transition from the temporary SRD grant to a more permanent Basic Income Support policy. This proposed policy, linked to economic and livelihood opportunities, aims to address the long-term needs of vulnerable populations.
