Grant spending to slow down a bit

Image courtesy of Wiki Media Commons

Image courtesy of Wiki Media Commons

South Africa has one of the biggest social protection programmes in the world with millions of households dependent on government grants to survive.

In total, 15.8 million people benefit from some form of social assistance, costing the fiscus nearly R131 billion this year. This figure has been increased to R144 billion for 16,05 million people in the new budget.

Child support and old age grants make up almost three quarters of the budgeted allocation. This money will be distributed to 11.194 million child support beneficiaries and 3 million old age grant beneficiaries.

Disability and foster care received R18.8 billion and about R6 billion respectively for the 2014/15 financial year.

During his Budget Speech in parliament Finance Minister Pravin Gordhan said that the state will shift its focus from social spending to infrastructure spending. As a result, social protection expenditure will increase at an average of 7.7% over the next three years.

Our present circumstances oblige us to live and spend modestly and keep a careful balance between social expenditure and support for growth,” the minister said in his prepared speech.

Grant increases for the year include:
• The old age and disability grants will increase in April from R1270 a month to R1350,
• The foster care grant will increase from R800 to R830, and
• The child support grant will increase from R300 to R310 a month in April, and to R320 in October.

“The recent re-registration of grant recipients (in 2012 and 2013) and the introduction of a new payment system have lowered the cost of administration. One million invalid beneficiaries were removed from the system. Social grants are meant for those who need them most,” Gordhan said.

The re-registration process included the collection of biometric information including finger prints to help prevent fraudulent claims in the future:
• 340 000 old age and disability grants were cancelled when beneficiaries failed to reregister
• 300 000 children were removed from the system because the primary care givers failed to present the children on whose behalf they were claiming the grant

The cost of distributing social grants is R16,40 per person per month – down from R32 five years ago.

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