The R350 Social Relief of Distress (SRD) Grant has been extended until March 2025.
“The Covid-19 social relief of distress grant will be extended for another year until March 2025 while the government considers social security policy reforms and a funding model,” Finance Minister Enoch Godongwana said.
He made the announcement while tabling the 2023 medium-term budget statement (MTBPS) on Wednesday.
“R34 billion is allocated to extend the Covid-19 social relief of distress grant by another year. Over the medium term, a provisional allocation is retained while a comprehensive review of the entire social grant system is finalised,” the minister said.
Godongwana said a policy decision was yet to be made on the grant and no funding had been agreed to.
“For this reason, the 2023 budget reiterated that any extension of the grant, or any replacement thereof, needs to be funded by a new revenue source of reprioritisation of other spending items.
“Since then, fiscal space has declined markedly, reducing the scope for an extension without additional financing.”
Godongwana said government was proposing that the fiscal framework make provision for funding for the grant in 2024/25.
“Beyond this, a comprehensive review of the entire social grant system by the Department of Social Development and the National Treasury is required,” he said.
Responding to media questions at a closed MTBPS briefing, Godongwana noted that the R350 grant was resilient and that he had previously said it was being extended for the last time.
“I have become honest now in handling it,” he said.
“You will see that what we are saying is that it is extended until March 2025 but being honest, we should not assume for credibility of the budget, it is to end in 2025.”
Godongwana said the review of the social security would entail elements of social protection such as social assistance to the elderly and others, social insurance and labour intensive interventions.
“We need to figure out how that looks. If that review is concluded, it will have to deal with SRD moving forward,” he said.
Apart from extending the R350 grant, MTBPS said the provincial budget allocations will not increase in line with inflation in 2024-25, a move that will lead to a funding gap for core services and transfers to non-profit organisations.
“The sector needs to prioritise and re-align resources to avoid adverse effects on service delivery,” he said.
This entailed combined spending on health, education, housing, social protections, transport, employment and local amenities.
“R945.9 billion will be spent on social protections transfers.
“This includes the old age grant, the child support grant, the disability grant and the Covid-19 social relief of distress grant.”