/ 21 February 2024

Budget 2024: Treasury responds to Ramaphosa’s promise to ‘extend and improve’ SRD grant

President Ramaphosa Host Special Olympics Team At Union Buildings
President Cyril Ramaphosa. File photo

The treasury has made provisional allocations of R35 billion in 2025/206 and R36.7 billion in 2026/27 to fund the Covid-19 social relief of distress (SRD) grant beyond March 2025.

These provisional allocations — laid out in the budget tabled by Finance Minister Enoch Godongwana on Wednesday — come after President Cyril Ramaphosa vowed to extend and improve the grant in his State of the Nation address earlier this month.

The grant is a lifeline to millions of the country’s unemployed, who have seen more than 3 million people added to their ranks in the last decade.

The terms of the grant’s extension beyond 2025 have yet to be agreed on. However, Godongwana noted in his speech that work is underway to improve the grant by April this year. 

“National treasury will work with the department of social development in ensuring that improvements in this grant are captured in the final regulations,” the minister added.

“These improvements will be within the current fiscal framework. For the extension of the grant beyond March 2025, the social security policy reforms, together with the funding source, will be finalised.”

After Ramaphosa’s address, the minister of social development published draft amendments to the regulations governing the SRD grant, giving effect to the extension to 2025. 

However, civil society has accused the government of using the amendments to propose further punitive clauses to the grant regulations, which stand to penalise beneficiaries.

One such clause will give the government the power to recover monies from beneficiaries if they are seen to have benefitted irregularly or were not entitled to benefit.

Responding to this proposal, the Universal Basic Income Coalition noted that it is incumbent on the department and the South African Social Security Agency (Sassa) to determine whether an applicant is entitled to benefit, before a grant is paid.

“[W]e are concerned about the possibility of deserving beneficiaries being prejudiced by DSD [department of social development] and Sassa changing their decision retrospectively. Given the already high rate of unfair exclusion from the grant, it is imperative that this clause does not provide further avenues to exclude people in need,” the coalition said in a statement.

Another proposed amendment will allow the government to cancel applications that have not been paid out after 90 days if the reason for non-payment is that the applicant is not traceable or has not updated their details, it noted.

“This is concerning, given that a very significant proportion of successful SRD grant applicants are affected by non-payment — not as a result of their own actions, but due to the poor administration of the grant by DSD, Sassa and their payment partners.”

The coalition added that it believes that Godongwana has used his veto power over the department to force it to acquiesce with the treasury’s preferred policy positions. “This overreach by treasury, and clear impasse at the heart of government, literally takes food off the tables of millions of South Africans.”

According to the budget document, the government’s spending on the grant in the 2024/25 fiscal year is R200 million lower than it was in 2023/24. However, the budget envisions that the number of the grant’s beneficiaries will increase by 219 000 in the 2024/25 fiscal year.