‘In­crease pen­sion grants’

Grants boost ‘real econ­omy’

The Witness - - NEWS - ES­TELLE SINK­INS

ANY in­crease in VAT and the fuel levy will be dev­as­tat­ing for the poor.

Mervyn Abra­hams, the pro­gramme co­or­di­na­tor of the Pi­eter­mar­itzburg Eco­nomic Jus­tice and Dig­nity Group, be­lieves that the gov­ern­ment should lis­ten to cam­paign­ers and in­crease the pen­sion grant to R2 500 a month.

On Fe­bru­ary 20, more than 100 pen­sion­ers from the Pi­eter­mar­itzburg area took part in a protest out­side the Na­tional Trea­sury in Pre­to­ria.

The pen­sion­ers, who re­ceive about R1 700 a month, said they were strug­gling to cope with high food prices.

“They de­manded that their old-age grant be in­creased to R2 500 and that gov­ern­ment should give them an an­nual 13th cheque in De­cem­ber,” spokesper­son Nox­olo Mfocwa said.

“The fig­ure is still less than the na­tional min­i­mum wage, which was re­cently set by gov­ern­ment at R3 500.

“One of the things which many peo­ple don’t re­alise is that most of the pen­sion­ers use the grants to take care of their chil­dren as well as grand­chil­dren.”

Abra­hams said his or­gan­i­sa­tion fully sup­ported the cam­paign by the pen­sion­ers fo­rum.

“We be­lieve that if they are given a grant in­crease it will be an in­vest­ment in the econ­omy, be­cause ev­ery cent of that grant money is be­ing very well spent in the real econ­omy,” he added.

The Pi­eter­mar­itzburg Eco­nomic Jus­tice and Dig­nity Group would like to see Fi­nance Min­is­ter Tito Mboweni come up with a new eco­nomic frame­work for the coun­try, rather than to sim­ply con­tinue to patch up the ex­ist­ing sys­tem with a Band-Aid.

“We need to recog­nise that the South African econ­omy is locked into a tra­jec­tory of low growth, high un­em­ploy­ment and low wages,” Abra­ham said. “We need to make long-term de­ci­sions to get out of this sce­nario. We need to prop­erly con­sider what will pro­vide a stim­u­lus for the econ­omy, if we are se­ri­ous about stop­ping the deep­en­ing in­equal­ity in our econ­omy.

“We be­lieve this stim­u­lus can best be done by in­creas­ing the in­come which flows into the poor­est ar­eas, for ex­am­ple through so­cial grants. In­creas­ing so­cial grants is not, what many peo­ple think, a deep, dark hole where money goes in and is never seen again. That money is, in fact, be­ing spent in the real econ­omy on food, ed­u­ca­tion and health.”

The group is also wor­ried about the gov­ern­ment mak­ing any in­crease in the level of val­ued added tax (VAT), say­ing it would have a neg­a­tive im­pact on those who could least af­ford it.

Abra­hams said VAT al­ready ac­counted for 7% of the cost of a 32item bas­ket of es­sen­tial gro­ceries, which means that R227 out of R3 200 goes to the tax­man. “The only re­sult from an in­crease would be that peo­ple will buy less food. And, if peo­ple buy less, then re­tail­ers will suf­fer and that could re­sult in fur­ther job losses.

“We re­ally have to be very care­ful not to over­bur­den the con­sumer,” he added.

The or­gan­i­sa­tion will also be mon­i­tor­ing Mboweni’s bud­get brief­ing closely to see if con­sumers will have to pay more for water and elec­tric­ity in the com­ing months. And they hope the min­is­ter will crack down on mu­nic­i­pal­i­ties to en­sure they spend the money they re­ceive from ratepay­ers and Trea­sury prop­erly.

“We don’t have lim­it­less re­sources ... it is in­cum­bent on Trea­sury to use ev­ery rand for its proper pur­pose and that we get value for our money. This is es­pe­cially im­por­tant in mu­nic­i­pal­i­ties where the amount of money be­ing squan­dered on ten­ders is ridicu­lous,” Abra­hams said.

In­creas­ing so­cial grants is not, what many peo­ple think, a deep, dark hole where money goes in and is never seen again.

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.