Recipients of the Social Relief of Distress (SRD) grant state that they lack funds to cover expenses and insist on an increase in payments. Since the introduction of the R350 grant during the Covid-19 pandemic, it has only been increased by R20, reaching the current amount of R370, which places recipients in a difficult position amidst rising costs.
Despite this, the Ministry of Finance warns that expanding and increasing the SRD grant could cost the State nearly R100 billion. However, economists urge the government to weigh the necessity of supporting unemployed South Africans against the country's ability to sustain a significantly increased budget for social benefits.
Nevertheless, the GOOD party called the Ministry of Finance's decision to challenge the Pretoria High Court's ruling regarding this grant a 'shameful abandonment of the state's constitutional obligation to provide income for needy people.'
The SRD grant was launched in 2020 as a temporary measure to assist unemployed adults with minimal or no income due to Covid-19. It remained at R350 for almost four years before being raised only to R370 in April 2024.
For beneficiaries, the R370 amount remains difficult to stretch over a whole month. One recipient, a qualified cosmetologist struggling to find permanent work, stated that she uses the money to purchase consumables for small cosmetic procedures. She noted that her earnings barely allow her to cover daily necessities.
Another SRD recipient expressed the opinion that additional social welfare funds would be better directed towards pensioners. She emphasized that some pensioners still bear financial burdens, including mortgage, electricity, and food payments, while others feed children and grandchildren due to their children's unemployment.
The Ministry of Finance's appeal followed the Pretoria High Court's ruling, which deemed certain aspects of the rules governing the SRD grant unlawful and unconstitutional. The court ruled that the government must gradually increase both the grant amount and the income threshold used to determine eligibility.
Economist Ulrich Jobert warned that once a social grant is introduced, it becomes difficult to abandon, and the government will constantly face pressure to increase payments. He stated that 'the big problem is that once you start such a grant, you cannot cancel it.'
Jobert added that the cost of expanding the program must be considered in the context of South Africa's limited tax base and broader fiscal pressure.
Jobert also argued that increasing benefits is not a substitute for economic growth and employment, insisting that the only way out is economic and employment growth. Economist Douwe Rudd agreed that a substantial increase in the grant could create additional pressure on public finances. He noted that increasing 'the Covid grant or this special grant could exceed R100 billion.'
Rudd stressed that from a purely financial perspective, this is unaffordable because the national debt is too high and the fiscal deficit is too large. He also pointed out that what started as temporary expenditure has effectively become a permanent fixture, and despite the inability to afford it, political reasons prevent stopping this trend.
The GOOD party rejected the insolvency arguments, proposing that the government find additional funds through zero-based budgeting, as well as by reducing waste, corruption, and unnecessary spending. This party previously advocated for SRD to become a permanent basic income of at least R999 per month for unemployed adults aged 18 to 60, linking this amount to the poverty line at the time of the study.



