Social grants increased by above inflation rates

Wednesday, February 21, 2018

Finance Minister Malusi Gigaba says social grants will be increase by above inflation rates.

Delivering the 2018 Budget Speech on Wednesday in the National Assembly, the Minister said this was deliberately done in order to protect vulnerable families from the impact of the proposed increase in value-added tax (VAT).

The Minister said as of 1 April 2018:

  • The old age, disability and care dependency grants will increase from the existing R1 600 by R90 to R1 690 and by a further R10 to R1 700 on 1 October 2018. 

  • The child support grant will increase from the baseline of R380 to R400 and to R410 on 1 October. This is a 6.6% annual increase. 

An additional R2.6 billion has been added to social grants since October 2017’s medium term budget to enable these changes. 

“These adjustments resulted in social protection spending increasing by 7.9% per year, much above inflation. 

“As highlighted by the President in the State of the Nation Address, government will ensure that social grants will continue to be paid without disruption,” he said.

In its budget review, National Treasury said expenditure on social protection provides social security and a safety net for low-income South Africans.

National Treasury said that it also improves social welfare service delivery to vulnerable individuals through policy and legislative reform, expanding the number of social workers, improving access to Early Childhood Development and facilitating food and nutrition initiatives.

“Spending on social protection is set to rise from R193.4 billion in 2018/19 to R223.9 billion by 2020/21, growing by an average of 7.9%.

“The number of social grant beneficiaries is expected to reach 18.1 million by the end of 2020/21.

“An estimated 12.8 million people will receive the child support grant, and 3.7 million people will receive the old age grant. Expenditure on grants is expected to increase at an average annual rate of 7.9% over the medium term, reaching R189.8 billion in 2020/21,” said Treasury. –

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