The Institute for Economic Justice (IEJ) has rejected proposals from National Treasury to replace the R350 social distress relief grant (SRD) in South Africa with one or more new grants, which it says will exclude the poor and vulnerable from collecting it.

Citing a presentation by National Treasury in August, the IEJ said that the government was proposing to partially replace the SRD grant with a ‘jobseekers grant’ or ‘household grant’ for some, possibly in combination with a truncated version of a caregivers’ grant, while excluding other poor persons entirely.

“This appears to be adopting a 2021 proposal made by the World Bank for replacing the SRD grant with a jobseeker’s grant only aimed at active jobseekers,” the IEJ said, adding that this would go to around 3.8 million beneficiaries at R350.

“The Treasury document is opaque and convoluted in terms of what it is exactly proposing, but it follows a similar logic of narrowing the grant beneficiaries and linking it to work-seeking conditionalities. It also contains extensive argumentation around why a continuation of a SRD grant, or variations, are ‘unaffordable’,” the group said.

In August, the Department of Social Development announced changes to how the SRD grant would be disbursed in South Africa.

On the one hand, the means test for the grant was boosted to R625 a month, allowing more people to qualify. On the other hand, the department made it clear that beneficiaries couldn’t reject assistance from the department in finding work and still claim the grant.

The department has been working with the Department of Employment and Labour and the National Treasury to develop employment and training programmes to assist SRD grant beneficiaries in finding work.

The IEJ, however, said that the proposals by Treasury, and the government’s focus on adding job-seeking conditions to grants, will ultimately exclude the people the grant is supposed to help.

“The R350 Covid-19 SRD grant has played a critical role in providing support to some of the most vulnerable people who bear the brunt of this crisis and have not previously been eligible for income support.

“Instead of steps to make this permanent and progressively scale it up, National Treasury has prepared regressive and unworkable proposals that seek to exclude many, if not the majority, of its
current recipients,” it said.

The job-seeking grant, the IEJ said, assumes that jobs exist in the economy for people to “seek”, ignoring the structural nature of South Africa’s persistent unemployment and the failure of existing job-seeking databases and skills development programmes to produce any real change.

It also rests on the “fundamentally patronising and moralistic” assumption that without job-seeking conditions, grants are likely to increase dependency and laziness, it said.

The household grant is similarly problematic, as it focuses on households, not individuals, significantly reducing the number of beneficiaries – a move the IEJ described as ‘anti-poor’.

This type of grant is also administratively burdensome – particularly in South Africa, where there is no fixed definition of a household – and has been proposed and rejected before.

The final proposal to fold in the SRD grant into a more limited ‘caregiver’s grant’ would only see the grant applying to those caring for children under two.

“Such a limitation radically alters the scope of the grant. There are approximately 7 million caregivers overall and 4 million who receive the SRD grant but only 1.5 million with children under two and in late pregnancy,” the IEJ said.

“A combined jobseekers’ grant and caregivers’ grant could well be restricted to around 5.5 million beneficiaries, around half of the SRD grant beneficiaries,” it said.

In August, the South African Social Security Agency (Sassa) recorded just under 12 million applicants for the SRD grant.

The IEJ said that the outcome of the proposals, if adopted, would be that millions of poor people – those who should be the primary target of cash transfer programmes like this – will be excluded from receiving support for the grant, either because they do not qualify or because the complexities of the system being imposed make it entirely inaccessible to them.

Read: Government shrugs as thousands of grants go to public servants