Business Edge | Much Ado About Basic Income Grant In South Africa

These are rather perilous times for South Africa. It is one of the most COVID-19 hit countries and provides a monthly welfare payment to its poorest and most vulnerable citizens. However, the conversation has expanded to paying its citizens a basic income grant to the South Africans who live on and below the poverty line. This has been met with mixed reactions from within the populace and in the presidency.

Lekan Onabanjo speaks with Siyabulela Mama, Spokesman of the Assembly of the Unemployed on Business Edge to find out the pros and cons of the basic income grant, if it addresses the roots of South Africa’s poverty crisis and the economic consequences of implementing a programme such as this.

“South Africa (among emerging economies) has the highest unemployment rate in the world,” Siyabulela said. “Over 45% of the South African population is unemployed and over 73% of this forty-five per cent is young people. Given the July 2021 unrest, the argument against a basic income grant is flawed. It is long overdue.”

However, analysts say that although the COVID relief grant which is set to expire at the end of March 2022, was a welcome palliative extending it until the end of the year will cost the country 35 billion rands while any expansion to institutionalize it will cost South Africa between 157 and 519 billion rands per year, a figure they say, the country simply cannot afford. Siyabulela Mama of the Assembly of the Unemployed says it can.

“Actually the 350 rands (currently being paid for COVID relief) is not enough. 350 rands in a month is [approximately] 11 rands per day. That cannot even buy a loaf of bread.” Instead, he recommends that the government funds domiciled at the Government Employees Pensions Fund be invested in the mass of unemployed South Africans. “It’s time we put this money into use. [Just] under two trillion rands sits there and workers continue to contribute 6% of their pay into it. Take this money and put it into financing a social wage, that’s how you can afford to pay a basic income grant.”

For now, the country is on tenterhooks as President Cyril Ramaphosa deliberates the direction the grant would go before the expiration in March.

Watch the conversation between News Central’s Lekan Onabanjo and Siyabulela Mama on Business Edge above.


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