Statement by Universal Basic Income Coalition
The Department of Social Development (DSD) has once again, with the concurrence of National Treasury, had to amend the COVID-19 Social Relief of Distress (SRD) Grant Regulations to accommodate its extension. The only amendment made is that the grant payments expiry date has changed from the end of the financial year of March 2023 to March 2024. In failing to amend the grant amount, the means test, and mechanisms for application and verification of income, government has once again failed to take the opportunity to address many of the challenges which have plagued access to, and implementation of, the SRD (R350 grant) since its inception, but particularly since new Regulations were introduced in April 2022.
Civil society and like-minded organisations have consistently asked government to ensure that all adults who live in poverty receive the grant, which will allow beneficiaries to meet their basic needs and safeguard them against hunger. People should be able to access the grant without struggling with onerous criteria that are exclusionary by default. Civil Society Groups including: The Alternative Information and Development Centre, Black Sash, the Children’s Institute at UCT, COSATU, Institute for Economic Justice, #PayTheGrants, Social Policy Initiative, Women on Farms and Youth Lab have formed a Universal Basic Income Coalition to support the call for a basic income grant.
The Coalition has been calling for the monthly SRD grant amount to increase from R350 to at least the monthly Food Poverty Line of R663 (in 2022 Rands) and to turn the SRD Grant into a permanent Universal Basic Income Grant for people between the ages of 18 to 59, progressively improving to the value of the Upper Bound Poverty Line of R1417 in 2022.
A coalition member’s submission to DSD called for an increase in the pitiful amount of R350, and highlighted how the grant regulations are exclusionary and make the grant inaccessible for the most impoverished and vulnerable people in society. The exclusionary measures relate to:
- the fact that the online platform is only available in English, creating a barrier for those without internet access and non-English speakers;
- limitations on beneficiary numbers by imposing a low-income threshold of R624 (this was aligned with the 2021 food poverty line but is no longer aligned with any measure of poverty);
- the inclusion of a questionnaire requiring unnecessarily invasive questions and the use of an unacceptably broad definition of ‘income’;
- reliance on flawed government databases to verify eligibility;
- the use of bank verification processes that create large errors of exclusion;
- a tedious and unfair review and appeals process; and
- no provision for the extension of the grant beyond April 2024.
At its height (in March 2022), 10.9 million people relied on the SRD grant to survive, but the number of beneficiaries who receive the grant are now substantially lower because of the restrictive measures imposed by the provisions to ensure that the number of beneficiaries who qualify are limited to an arbitrary budget cap imposed by Treasury. On 15 February 2023, Minister of Social Development, Lindiwe Zulu revealed that as of the end of January SASSA received over 13,5 million applications for the Covid-19 SRD. Yet, despite this need, only 7,48 million people were approved in January- i.e. 3.5 million fewer people were approved to receive the grant in Jan 2023 than March 2022, please refer to table in Appendix A. This indicates a massive rate of exclusion.
The scale of the unemployment crisis is such that there is no prospect of the majority of the unemployed finding work in the short term, underlining the critical need for social security interventions to be expanded: In quarter four 2022, Stats SA recorded that 11.8 million people were unemployed, with the vast majority of them being long term unemployed. Even if we only consider those who are unemployed according to the narrow definition (excluding discouraged work seekers) 78.3% of them are long term unemployed.
Poverty, inequality, and unemployment are the most profound crises confronting democratic South Africa. A comprehensive response to our socio-economic crisis should include effectively implementing job creation programmes, supportive economic and industrial policies that stimulate job creation, and providing quality basic services in conjunction with permanent basic income support.
With such high levels of unemployment and poverty in South Africa, the SRD Grant is not only a lifeline, but has also been shown to promote job seeking, job creation and economic activity. There are, for example, success stories of the youth using the SRD grant to start up their own small businesses. However, many beneficiaries do not have the option of saving up their grant to start their own businesses as they must use the whole SRD grant for daily necessities such as food and electricity. The SRD grant is vital for addressing poverty, hunger and unemployment in South Africa. Discontinuing it will leave millions of people hungry and destitute, as will failure to address the large exclusion errors.
Government has mentioned budget constraints in funding the SRD Grant and National Treasury has suggested that it is unaffordable. However, government reported a R94 billion revenue overrun in the recent Budget. Rather than addressing South Africa’s hunger crisis, Treasury is choosing to prioritise reducing the country’s debt more aggressively than is necessary. In the latest amendments to the SRD Regulations, Treasury has added a clause specifying that payments are limited to the budget appropriation for this year, thus ignoring the concerns raised by civil society, that the budget allocation is far too low to even reach the group of people living below the food poverty line, as indicated by government’s own statistics.
It is now clear that none of the issues civil society has repeatedly raised will be addressed unless we use alternative means to compel government to address them. Members of the Coalition have repeatedly submitted detailed comments and reasonable proposals for improving the regulations at every step. Unfortunately, these comments and proposals have been wholly ignored. The Coalition will look at a range of methods to pressurise government to address these legitimate concerns.
Finally, at least one member of the Coalition has now reached the point where it feels that it may have no option but to pursue legal action, and others might consider joining. Litigation may be the last resort, but it is critical that issues of unfair exclusion affecting millions of SRD applicants are addressed urgently. Therefore, litigation may be one of a range of options that may be considered going forward.
[ENDS]
Media Contacts:
Institute for Economic Justice
Dalli Weyers
dalli.weyers@iej.org.za +27 82 460 2093
Black Sash
Akona Gwiliza
akona@blacksash.org.za +27 84 070 9867
Media can contact Black Sash for DSD submissions.
This statement is supported by: The Alternative Information and Development Centre, Black Sash, the Children’s Institute at UCT, COSATU, Institute for Economic Justice, #PayTheGrants, Social Policy Initiative, Women on Farms and Youth Lab.
[ENDS]
Amaarah is a Junior Programme Officer in the Rethinking Economics for Africa project. She is currently studying towards her Masters in Applied Development Economics at Wits University. 
Dr James Musonda is the Senior Researcher on the Just Energy Transition at the IEJ. He is also the Principal Investigator for the Just Energy Transition: Localisation, Decent Work, SMMEs, and Sustainable Livelihoods project, covering South Africa, Ghana, and Kenya.
Dr Basani Baloyi is a Co-Programme Director at the IEJ. She is a feminist, development economist and activist. She gained her research experience while working on industrial policy issues in academia, at the Centre For Competition, Regulation and Economic Development (CCRED) and Corporate Strategy and Industrial Development (CSID) Unit.
Dr Andrew Bennie is Senior Researcher in Climate Policy and Food Systems at the IEJ. He has extensive background in academic and civil society research, organising, and activism. Andrew has an MA in Development and Environmental Sociology, and a PhD in Sociology on food politics, the agrarian question, and collective action in South Africa, both from the University of the Witwatersrand.
Juhi holds a Bachelor of Arts degree in International Relations and Sociology from Wits University and an Honours degree in Development Studies from the University of Cape Town. Her current research focus is on social care regimes in the South African context, with a particular focus on state responses to Early Childhood Development and Long-Term Care for older persons during the COVID-19 pandemic. Her other research areas include feminist economics, worlds of work and the care economy.
Bandile Ngidi is the Programme Officer for Rethinking Economics for Africa. Bandile has previously worked at the National Minimum Wage Research Initiative and Oxfam South Africa. He holds a Masters in Development Theory and Policy from Wits University. He joined the IEJ in August 2018. Bandile is currently working on incubating the Rethinking Economics for Africa movement (working with students, academics and broader civil society). 
Liso Mdutyana has a BCom in Philosophy and Economics, an Honours in Applied Development Economics, and a Masters in Applied Development Economics from Wits University. His areas of interest include political economy, labour markets, technology and work, and industrial policy. Through his work Liso aims to show the possibility and necessity of economic development that prioritises human wellbeing for everyone.
Joan Stott holds a Bachelor of Business Science in Economics and a Master’s in Economics from Rhodes University. She brings to the IEJ a wealth of experience in public finance management, policy development, institutional capacity-building, and advancing socioeconomic and fiscal justice.
Siyanda Baduza is a Junior Basic Income Researcher at IEJ. He holds a BSc in Economics and Mathematics, an Honours degree in Applied Development Economics, and is currently completing a Master’s degree in Applied Development Economics at the University of the Witwatersrand. Siyanda’s research focuses on the impacts of social grants on wellbeing, with a particular focus on the gendered dynamics of this impact. His interests include applied micro-economics, policy impact evaluation, labour markets, gender economics, and political economy. He is passionate about translating economic research into impactful policy.
Shikwane is a Junior Programme Officer at IEJ focusing on civil society support and global governance in the G20. He has a background in legal compliance, IT contracting and student activism. He holds degrees in Political Studies and International Relations, as well as an LLB, from the University of the Witwatersrand.
Dr Tsega is a Senior Researcher focusing on Women’s Economic Empowerment within the G20. She examines gender equity in economic policy, with expertise in food systems and small enterprise development. She holds a PhD in development studies from the University of the Western Cape, an MA in Development Economics, and degrees in Development Studies and Economics from UNISA and Addis Ababa University.
Nerissa is a G20 Junior Researcher at IEJ, focusing on advancing civil society priorities within the G20 framework. She bridges data, research, and policy to advance inclusive economic frameworks. She is completing a Master’s in Data Science (e-Science) at the University of the Witwatersrand, and holds Honours and Bachelor’s Degrees in International Relations with distinction. She has worked as a Research Fellow at SAIIA and a Visiting Research Fellow at Ipea in Brazil.
Dr Mzwanele is a Senior Researcher supporting South Africa’s G20 Sherpa with policy research. He holds a PhD in Economics from the University of Birmingham and an MSc from the University of the Witwatersrand. His work covers open macroeconomics, trade, finance, and higher education policy, and he has published widely on inequality, unemployment, household debt and higher education curriculum reform.
Kamal is the Project Lead for IEJ’s G20 work, focusing on sovereign debt and development finance. He holds a BComm (Hons) in Applied Development Economics from the University of the Witwatersrand and an Erasmus Mundus Joint Masters in Economic Policies for the Global Transition. He has worked with SCIS, UNCTAD and co-founded Rethinking Economics for Africa.