21 February 2024
Social grants are to go up, the Minister of Finance announced in Wednesday’s budget, but most are not going to keep pace with inflation. Photo: Ashraf Hendricks
The Old Age Grant is to go up by R100, Finance Minister Enoch Godongwana announced in his Budget speech on Wednesday. For pensioners younger than 75 years, grants will rise by R90 from R2,090 to R2,180 in April, and by a further R10 to R2,190 from October 2024.
Here is how grants will look this year:
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The minister said that the increases are to keep pace with inflation. But the increases are lower than the current inflation rate of 5.3% between January 2023 and January 2024. The latest food inflation report for December 2023 by the Bureau for Food and Agricultural Policy shows a year-on-year increase of 8.5% in the prices of food and non-alcoholic beverages.
“We are sensitive to the increase in the cost of living for the nearly 19 million South Africans who rely on these grants to make ends meet,” the minister said.
The government aims to complete an extensive review of social security policy, according to the Estimates of National Expenditure tabled with the Budget speech, to make sure that reforms can be implemented with the government’s “constrained resources”.
A white paper on social security is to be finalised in the next three years.
The Covid Social Relief of Distress grant, which pays R350 to about 8-million people every month, is to continue until the end of 2024-5. After that, the Budget Review says, the social assistance budget will drop to R248-billion. “This termination is expected to see a reduction in the total number of grant beneficiaries, from an estimated 27.8 million in 2023/24 to 19.7 million in 2026/27.”
“In addition, after the decision to extend the Covid social relief of distress grant until the end of 2024/25, the department will finalise policy options on the replacement of the grant, taking into consideration the need to strengthen employment pathways and means for sustainable livelihoods,” the Budget Review stated.
In the meantime, the minister said, provision has been made to prioritise job creation initiatives with R61-billion allocated for employment programmes over the medium term, and R7-billion identified for the Presidential Employment Initiative.