Push for R624 basic income subsidy in South Africa

The Congress of South African Trade Unions (Cosatu) has again supported the introduction of a new basic income subsidy in South Africa.

On Thursday (May 26), the country’s largest trade federation presented its resolutions after the central executive committee meeting. He added that the R350 Social Relief of Distress (SRD) grant, introduced by the government in response to the Covid-19 pandemic, should form the basis of this new basic income grant.

The grant is currently provided to more than 10 million unemployed beneficiaries across South Africa.

“We believe it is affordable at a cost of R44 billion on a budget of R1.8 trillion. What is not convenient is leaving 10 million unemployed without a source of income. Grant recipients must be linked to vocational training programs to help them find work.

“We cannot sustain a ratio of 14 million employed people supporting 30 million social grant recipients and the unemployed. The R350 SRD grant is to be extended beyond 2022, raised to the food poverty line and used as the basis for a basic income grant.

South Africa’s food poverty line in 2022 is currently set at R624.

Almost all South Africans can now count on financial support from the government, says the Department of Social Development. In a presentation to parliament in early May, the department said around 31% of the South African population rely on social grants, which include everything from disability to childcare.

However, there are around 10 million beneficiaries who depend on the monthly special R350 Covid-19 Social Relief of Distress Grant alone.

This increases the number of South Africans who rely on social transfers to around 47%, he said.

Data from Bloomberg and Old Mutual show that the country currently has twice as many welfare beneficiaries as registered taxpayers. The government is now considering introducing a basic income subsidy in South Africa, which should further expand the social safety net.

Reading: Updated minimum wage for South Africa

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