Basic Income Grant: A solution to poverty and inequality in South Africa?

South Africa has allocated social grants for millions of its citizens to minimize the inequality gap, yet this gap has widened since the dawn of democracy. For almost 20 years, various stakeholders have argued for the introduction of a Universal Basic Income grant in South Africa,which is expected to alleviate poverty and inequality in South Africa. As it stands, South Africa has an unemployment rate over 63% which has resulted in vulnerability of young people between the ages of 15 to 24. Needless to say, the COVID-19 pandemic has resulted in more job losses and loss of income. 

It is in this context that the Social-Relief Distress (SRD) Grant was introduced in South Africa. It entailed a payment of R350 to those who needed, most likely unemployed persons. During the unprecedented riots in July 2021 the SRD was expanded to previously excluded caregivers. However, unions and some civil society organizations are calling on the government to expand it to a monthly basic income grant of R1268, which is above the food poverty line. While grants have significantly reduced the incidence and severity of poverty, they exclude the unemployed, placing a burden on existing recipients and effectively eroding the transfer value. 

Africa Unite hosted an online dialogue on 22 September 2021, to discuss the merits and demerits of a basic income grant in South Africa. The dialogue was moderated by Africa Unite intern, Oboitshepo Seleka. The dialogue sought to engage on perceptions around the basic income grant, including the percpetion that it would perpetuate a culture of dependency and laziness. The Studies of Poverty and Inequality Institute (SPII) and the Assembly of the Unemployed, are organisations that have done extensive research and advocacy work for the implementation of a basic income grant.  On the panel we had Christina van Straten and Khokhoma Motsi, respectively tp share insight on research that has been done on the basic income grant, as well as experiences on the ground. The discussion included suggestions on how the BIG can be funded in South Africa, and how it would alleviate poverty and inequality.

Both panelists agreed that the BIG is not a silver bullet to all the socio-economic challenges in the country, however it would be a good starting point. Christina van Straten (SPII) illustrated that a BIG has been implemented in countries such as Kenya, Brazil, Canada amongst others, and the outcomes were positive. Motsi Khokhoma (Assembly of the Unemployed) strongly argued against the perception that the BIG would perpetuate a culture of dependency on the government. Rumors that it would only make South Africans lazy is unfounded because all people are dependent on the government, to some extent. The BIG would promote participation in the economy and increase spending power. Ultimately increasing economic activity in townships and promoting a decent standard of living for all. At the heart of the BIG debate is the issue of rising unemployment, as such the BIG could be the stepping stone for unemployed persons to take a taxi to search for employment opportunities.

It has been reported that women continue to bear the brunt of poverty as the primary caregivers. Moreover, women have been greatly affected by gender-based violence due to being financially exploited because they are unable to support themselves. Women are faced with a double conundrum; they are unable to shield their families from hunger and have to stay in abusive relationships. Christina van Straten (SPII) spoke extensively to this issue and emphasised that a BIG would lighten the burden on women who find themselves in such precarious situations.

Youth unemployment is a burning issue in South Africa, thus the recommendation of a BIG seemingly represents a lifeline for South African youth. Motsi Khokhoma reiterated that the reality on the ground is that people are starving, living in dire circumstances and do not have access to their basic needs. They also face high crime rates in their communities, young people are more susceptible to crime and drug abuse. Ideally, young people could try to pull themselves up by their bootstraps, however, they face more challenges than what is on the surface. There is also a lack of political will within local and national level, that has hindered progress on the matters indicated.

The matter still hangs in the balance. Considering all socio-economic and political factors, can South Africa afford a basic income grant? The issues at hand are quite pertinent and stand to impact the future of all South Africans. As time passes, the inequality gap continues to widen and ordinary South Africans are faced with a bleak reality. Although we did not reach one conclusion, all participants in the dialogue agreed that civil society cannot just sit back, but we need to put in effort to change this unfortunate reality.

If you would like to watch the dialogue, it can be found here

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