Pretoria – Lobby group AfriForum has submitted its written comments, rejecting the proposed amendments to regulations, which increase Covid-19 grants.
Social Development Minister Lindiwe Zulu has proposed amendments which would see the income threshold for a person to qualify to receive the Social Relief of Distress (SRD) grant change from the current R350 monthly to R624, which is the national poverty line.
“These amendments first propose that the income threshold to qualify for the monthly R350 Covid-19 allowance is increased from R350 to R624 resulting in many more people qualifying for the grants. Second, the regulations give the ministers of health and finance the power to further amend the income threshold from time to time,” said Reiner Duvenage, campaign officer for strategy and content at AfriForum.
In the comments, AfriForum emphasises that the organisation has “deep sympathy for the millions of people in the country who live in poverty.
“However, AfriForum emphasised that the poverty is caused by government failures which have led to a 46.2% unemployment rate and the payment of allowances to 46% of the population. These grants are financed by an extremely thin tax base of which just over 5% of taxpayers pay 91.8% of taxes,” said Duvenage.
“The expansion, increase of Covid-19 allowances is not a solution to poverty, because citizens who qualify for the allowances still find themselves far below the upper poverty line of R1 335 per month. Furthermore, the payment of these grants makes the population even more dependent on the government, which due to the country’s catastrophic fiscal position cannot sustain these expenses in the long term.”
AfriForum said South Africa was considered to be on the brink of a “fiscal cliff”.
“This means that interest or government debt, civil service salaries and social grants amount to more than the government’s total income. Thus, AfriForum argues that the further expansion of Covid-19 grants is entirely unaffordable,” said Duvenage.
“The government’s only role is to create a favourable situation for the private sector to generate jobs, and therefore, wealth. By paying grants to almost 50% of the population, the government is trying to take over the role of the private sector.”
AfriForum’s comments request the government “to stop its excessive involvement in the economy and give the private sector the freedom to ensure real progress and prosperity together with communities,” said Duvenage.
The change is contained in the Government Gazette published earlier this month, with comments open until July 29.
In the gazette, Zulu indicated that from time to time, with the agreement of Finance Minister Enoch Godongwana, the income threshold would be amended.
Zulu’s proposal follows intense public pressure from civil society organisations that have, among others, demanded she lift the income eligibility threshold from R350 to R624, the food poverty line, and lift the budget cap of R44 billion to cater to all those who qualify for the grant.
They also demanded the removal of the clause forcing applicants to reapply every three months.
