Dlamini reckless with grants that feed millions
of Social Development, Bathabile Dlamini, and her department have been highly irresponsible for leaving the distribution problem in limbo for so long.
This even after they were instructed by the Constitutional Court to make alternative arrangements. It leaves the impression that the minister and her department want to force the country into a crisis, leaving no option but to get approval to continue using the current service provider.
Neither the minister nor the department have shown any urgency to bring this matter to a speedy resolution. It’s also disconcerting that the minister seems to live in denial. She’s failed to admit that there’s a pending crisis of national proportions.
The minister should take political responsibility for this crisis. If she refuses to accept responsibility, it raises the question of whether the ministry she runs is needed at all or can be merged with another ministry, as its largest single responsibility is oversight of the legal administration and payment of social grants. It is also disconcerting that others in leadership positions in the government have remained quiet. In any other country the head of state would have stepped in to try and defuse the looming crisis. But it seems that expecting any action from President Jacob Zuma in a crisis – except if he stands to gain personally – is too big an ask. They’re very important because of extent of poverty, the consequent number of recipients, and the amount paid out. Total expenditure on grants in the 2017-18 financial year will amount to more than R150billion.
Grant money is not only used to support beneficiaries. It’s also used to provide broader support. Based on research I conducted, more than onethird of South Africans depend – directly and indirectly – on grant payments. Any disruption of grant payments will therefore have a massively detrimental impact on a large number of poor households.
In addition, the economies of small towns and villages would be hit hard because they are heavily dependent on grant payments being used to buy goods and services in local shops. One knock-on effect would be that shop owners’ income streams would be affected and they wouldn’t be able to pay employees’ salaries. Grant payments redistribute income to poor households and have contributed to a reduction in poverty in South Africa.
The social grant net is the government’s biggest poverty alleviation and redistribution intervention. There are others, such as government housing provision and free water allocation. But payments in grants outstrip these by a large margin. had about 4.2 million beneficiaries of social grants.
This grew rapidly to about 17 million beneficiaries as the grants were expanded to include older children.
Because SA was going through a period of rapid economic growth at that time it could easily afford new spending initiatives and projects.
But since 2008 the country has suffered a period of low economic growth. And there isn’t any expectation that the situation is likely to improve in the foreseeable future. As a result the system has become unaffordable.
An additional concern is that the Minister of Social Development has suggested there might be an extension of child support grants. This is simply unaffordable and will push South Africa closer to the fiscal cliff – the point at which its spending outstrips its revenues and it can’t meet its debt obligations.
In any other country the head of state would have stepped in to try and defuse the looming crisis