SASSA Grants Get a Boost With a Big Cut to Salaries! Half of South Africa population is grappling with poverty, exacerbated by widespread job losses due to the Covid-19 pandemic. Many are now dependent on grants for survival, highlighting the critical need for effective social support systems.
The Basic Income Grant (BIG) Initiative
In response to the escalating poverty crisis, a potential solution called the Basic Income Grant (BIG) has emerged. This initiative aims to provide limited redistribution to the country’s poorest citizens, offering a lifeline amid economic hardships.
The BIG Proposal
The Applied Development Research Solution (ADRS) and the Institute for Economic Justice (IEJ) released a report suggesting that implementing the BIG could significantly reduce poverty and inequality, while also stimulating economic growth and employment.
What BIG Entails
The BIG is envisioned as a social grant program that could be funded through a combination of a modest wealth tax and a social security tax. It would be extended to all eligible South Africans between the ages of 18 and 59 over an eight-year period, without affecting other adult grants.
International Models of Success
Several countries, including the United States, Norway, and Brazil, have successfully implemented similar basic income grant programs. These models have provided citizens with financial support irrespective of employment status, income, or qualifying factors.
Feasibility Concerns
Economist Professor Bonke Dumisa expresses skepticism about the feasibility of the BIG initiative in South Africa. With over 46% of total expenditure already allocated to social welfare and government debt soaring, he questions the country’s financial capacity to undertake another social grant program.
Unemployment and Fiscal Challenges
Dumisa highlights the alarming rate of unemployment, currently at 31.9%, and the burden of government debt exceeding R40 trillion. He argues that the country lacks the financial resources to support another social grant, especially with a diminishing tax base due to both unemployment and emigration.
Public Opinion
Niko Khoza and Vusi Ndlovu voice concerns about the BIG initiative, advocating for a focus on job creation rather than blanket financial assistance. They emphasize the importance of aligning education with market demand to empower future generations with relevant skills.
Conclusion
While the BIG initiative presents a potential solution to alleviate poverty in South Africa, concerns about its financial viability and impact on unemployment persist. As the nation grapples with economic challenges, a balanced approach that considers both social grants and job creation may be necessary to address the multifaceted issues at hand.
