We need basic income support now!
The Black Sash has campaigned for years for the implementation of income support for those who are 18 to 59 years old with no or little income. The COVID-19 Social Relief of Distress and the Caregiver grants is a critical step towards the implementation of universal basic income support, where all who live in South Africa receive an income from government that is high enough to ensure a dignified life. Income support is feasible and affordable, and will contribute to economic growth. It is not a hand out, but a share of the collective wealth of South Africa. Income support will also ensure that many households in the country have improved health and educational outcomes, which will have a long-term impact on poverty reduction. To this end, Minister Zulu’s recent statement for basic income support is encouraging.
The expansion of social grants is one of the greatest post-1994 redistributive achievements in South Africa. Social grants provide financial support to over 18 million of the most vulnerable: the elderly, children, and people with disabilities. Despite this, the country’s social security system has some serious coverage gaps. Although Section 27 of our Constitution makes provision for Social Security, “including appropriate social assistance if they are unable to support themselves”, South Africa still does not have a social assistance or income support programme for adults with no or little income aged 18 to 59 years.
The South African Government in 2015 also ratified the International Covenant of Economic, Social and Cultural Rights (ICESCR), an international treaty of the United Nations that protects a wide range of human rights. By October 2020, the South African government has an obligation under international law to ’ensure that those between the ages of 18 and 59 with little or no income have access to social assistance’. Other key recommendations include ’consider the possibility of introducing a universal basic income grant’ and 'raise the levels of government social assistance benefits to a level that ensures an adequate standard of living for recipients and their families’. What are we waiting for?
Proponents against a basic income usually advance two arguments: that we can’t afford it, and that if unemployed people receive income support they will stop looking for work. In fact, a growing body of research from pilot studies globally shows that guaranteeing a minimum income is a key means to enable people to engage in economic activity, including job seeking, and that a basic income is able to reduce both poverty and inequality. But by the end of July 2020, as the number of COVID-19 infected people continues to soar and desperate hunger in many parts of South Africa is widely reported, advising the hungry to look for a job is cruel as well as unrealistic.
The most recent Statistics South Africa Quarterly Labour Force Survey (QLFS, 23 June 2020) shows that before the pandemic, in the first quarter of 2020, the number of unemployed persons increased to about 10 million (42%) based on the expanded definition. Even worse, the percentage of young people (South Africa’s future) aged between 15 and 34 years who were not in employment, education or training increased from 40,7% to 41,7% in this period. South Africa has a structural unemployment problem and the truth is that the millions of unemployed people will continue their struggle to find work beyond the current pandemic. What horrors will the labour survey of the second quarter of 2020 reveal? Can we afford not to introduce basic income support?
The reasons for South Africa’s inability to generate jobs over the past two decades are many faceted and widely debated. As President Ramaphosa has repeatedly stated, the outpouring of solidarity towards those with no resources who are starving has been admirable. However, this cannot substitute for state action backed by the fiscus. We are facing a national crisis.
What has government done so far? In response to the COVID-19 pandemic, the Department of Social Development and SASSA planned to distribute 250 000 food parcels through the Social Relief of Distress programme. As the extent of the national humanitarian crisis became evident, this number was increased to a million food parcels. Though better than nothing, the programme is inadequate and has been beset by the usual suspects – government’s lack of capacity and mismanagement. The food parcel tender and its distribution network are now mired in allegations of corruption.
In April 2020, government introduced the COVID-19 Social Relief of Distress (SRD) grant. This grant of R350 per month, for six months ending October 2020, targets individuals aged 18 to 59 with no income. A Caregiver grant valued at R500 monthly for five months was also initiated. Although these new grants are a critical step towards the implementation of a universal basic income grant, R350 and R500 respectively per month is below the value of the food parcel and is highly insufficient to make a difference to hunger. These amounts are inadequate to cover food, energy sources and transport, as well as the additional cost of complying with hygiene protocols during the pandemic. The Black Sash, through our wide partner network, has been involved in the effort to assist people to apply for the COVID-19 SRD grant. The digital application platforms continue to be inaccessible for many eligible applicants. Three months in, many have still not received this grant.
The Black Sash recommends a phased-in approach to basic income support. Minister Zulu has identified two age groups most critically in need that should be prioritised: the 18 to 24 year olds (the Child Support Grant ends when a child turns 18), and those between 50 and 59 years old. Both the COVID-19 SRD and the Caregiver grants should be converted into permanent basic income support. We estimate that between 10 and 15 million people will need this grant. We look forward to the Minister presenting an implementation plan with a budget.
Reality check: according to figures calculated by the Pietermaritzburg Economic Justice and Dignity Group, the cost of the monthly basket of staple foods has increased by 6% to R3 413,14 for the period March to July 2020 for the average household. The value of the basic income support grant, then, should be increased to at least the upper-bound poverty line, which is currently R1, 227 per month.
How do we fund basic income support? Suggestions from economists range from the reprioritisation of government expenditure to raising tax revenues, eliminating illicit financial flows, and fiscal drag.
Prior to the pandemic, together with our community partners, we have developed over many years a clear-eyed view of the poverty and desperation in South Africa. In this unprecedented global emergency, the Black Sash insists that basic income support for those aged 18 to 59 is introduced now!
- Op-ed by Black Sash National Director, Lynette Maart, published in The Sunday Times (KZN), Sunday August 2nd 2020, Pg 18