The Social Relief of Distress (SRD) grant, a lifeline for millions of unemployed South Africans, is facing its scheduled end in March next year, with the government confirming no plans for further extensions.
This revelation came from Finance Minister Enoch Godongwana’s 2024 Medium-Term Budget Policy Statement (MTBPS) presented to Parliament, signaling a significant shift in the government’s approach to social support and unemployment.
Introduced in 2020 as a temporary measure to mitigate the economic fallout of the Covid-19 pandemic, the R350 grant has been extended multiple times, providing crucial assistance to those without income.
This year’s budget included a modest R20 increase, bringing the grant to R370, with an additional R1.6 billion allocated to partially fund this increase, bringing the total allocation for the grant, including rollovers, to R36.3 billion for 2024-25.
A further R1.555 billion was rolled over from the previous financial year to cover outstanding payments.
However, the MTBPS has now definitively stated that there will be no further SRD grants in the coming financial years.
The government’s decision to discontinue the SRD grant is rooted in a desire for fiscal sustainability.
The National Treasury emphasized the need for any permanent increases in social spending to be financed by sustainable revenue streams.
The MTBPS explicitly states that “over the next three years, 30.6% of the population will receive some form of grant, excluding the Covid-19 social relief of distress grant.”
This highlights a strategic move towards consolidating existing social programs and exploring more sustainable solutions to address unemployment.
Instead of continuing the SRD grant, the government is focusing on reforming the broader social grant system and consolidating public employment initiatives.
The MTBPS outlines plans to spend R3.4 billion on job creation initiatives in the 2024-25 financial year, suggesting a move towards empowering individuals through employment opportunities rather than relying solely on temporary relief measures.
This approach also acknowledges the current fragmented nature of unemployment support, which the National Treasury describes as interventions being “split across agencies” and lacking “a cohesive, integrated system.”
It is therefore hoped that the new approach will provide more structured and effective support.
The government also aims to improve the link between the social security system and the goal of increasing employment.
In addition, the National Treasury announced plans to review the impact of the skills development funding system, where the levy collected averaged R20.09 billion over the last three years.
This review, with proposals to be presented in the 2025 budget, suggests a focus on enhancing skills development and employability to address the root causes of unemployment.