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MTBPS: Cry of the Xcluded demands basic income grant be at the top of the list for Finance Minister

The ANC's economic transformation commission head, Enoch Godongwana. Picture: Dumisani Sibeko/ANA Pictures

The ANC's economic transformation commission head, Enoch Godongwana. Picture: Dumisani Sibeko/ANA Pictures

Published Nov 10, 2021


Cape Town - Anti-austerity movement Cry of the Xcluded is demanding that the basic income grant (BIG) be at the top of the list when Finance Minister Enoch Godongwana presents the medium term budget policy statement (MTBPS) on Thursday at 2pm.

Members of the movement plan to march from the Civic Centre in Cape Town to Parliament via the CCMA office on Thursday to demand an end to budget cuts that hurt the poor and for government-led job creation, as well as greater climate change protection.

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South African Federation of Trade Unions (Saftu) general secretary Zwelinzima Vavi, one of the movement's leaders, says the poor of South Africa are fed up with empty promises, made by politicians in election campaigns, that leave them hungry.

“The state should look to progressively introduce an unconditional universal basic income grant. We need a basic income now for 18- to 59-year-olds who are without a stable income, to receive a basic grant from the state.

“We demand a BIG of R1 500 that meets the immediate living needs of the unemployed.

“This basic income grant would boost the economy, creating demand for products and services, and thus creating many jobs.

“And when the voices of the ruling class say that what we demand is impossible and unrealistic, and when they rhetorically ask who will pay for all this?, we will give them our answer: Tax the rich and the big polluters so that the poor can live,” Vavi said.

Economist Mike Schussler said: “There is only one way to close the poverty gap in South Africa in the long run and that is to create more jobs.

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“Our main crisis in South Africa is that we’ve got nearly 12 million people that are unemployed. That’s a lot more than we’ve ever had.

“I find the idea of taxing the rich quite funny, because the unions represent most of the rich in South African terms, civil servants make up about 40% of the top 10% of taxpayers.

"Obviously not all unions are rich, but the point is if you’re going to tax the rich, there’s very few rich left in South Africa and if they also leave there will be bigger problems,” Schussler said.

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Bankers are also predicting the basic income grant will feature prominently in the budget.

In July, the treasury said the reinstatement of the Social Relief of Distressed (SRD) grant had been made possible by the temporary revenue performance from elevated commodity prices.

FNB senior economist Thanda Sithole said: “We expect the budget to highlight progress on various options that Treasury is considering to address the widening poverty gap, which includes, the BIG; an extension of the R350 SRD grant; and the extension of the Presidential Employment Stimulus and Job Seekers allowance.”

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Absa economist Peter Worthington said that while Godongwana and the Treasury have argued that a big expansion of social grants is unaffordable, investors should watch closely what the MTBPS signals for social grants, with strong pressure on the government and the party to expand the SRD grant into a BIG.

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Cape Argus