The South African Cabinet has returned the proposed Basic Income Grant (BIG) plan for further revision, citing concerns over its financial sustainability and implementation strategy. This decision delays the introduction of a permanent income support system aimed at alleviating poverty and unemployment.
The proposal, which sought to transform the existing Social Relief of Distress (SRD) grant into a permanent Basic Income Grant, faced significant scrutiny within the Government of National Unity (GNU). Key issues included disagreements over funding mechanisms and the potential economic impact of the grant. A contentious proposal to increase the Value-Added Tax (VAT) by two percentage points to finance the BIG was met with resistance, leading to the postponement of the 2025 Budget presentation.
Leaked documents from the African National Congress (ANC) indicated a commitment to phasing in the BIG in 2025, using the SRD grant as a foundation. However, the absence of explicit mention of the BIG in official ANC statements following the January lekgotla raised questions about the party’s commitment to the initiative.
The delay has drawn criticism from social justice organizations and opposition parties. The Institute for Economic Justice (IEJ) and the PayTheGrants campaign have emphasized the urgency of implementing a BIG to address the country’s high unemployment and poverty rates.
Despite the setback, the government has extended the SRD grant, currently valued at R370 per month, until March 2026. This extension aims to provide continued support to vulnerable populations while a more sustainable and comprehensive income support system is developed.
As the Cabinet revisits the BIG proposal, stakeholders across the political spectrum and civil society continue to advocate for a viable solution that balances fiscal responsibility with the urgent need to support South Africa’s most vulnerable citizens.
