National Treasury to decide on basic income grant policy by July

The Department of Social Development (DSD) expects to hear by July whether National Treasury is satisfied with revisions made to its proposed Basic Income Support (BIS) policy.

This is a key step before the policy can advance through the government approval processes.

The department briefed parliament’s Select Committee on Social Services on Wednesday on progress in developing the policy, which is intended to provide income support for working-age adults.

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The DSD first presented a draft policy to cabinet in November 2024, but cabinet sent it back for further work, asking for stronger links between income support and employment opportunities.

Deputy director-general for comprehensive social security Brenda Sibeko told MPs that the department had spent the past year consulting government departments on how the proposed grant could be linked to economic opportunities and employment initiatives.

On 22 May, the DSD and the Presidency held a workshop with the departments of Home Affairs, Employment and Labour, Small Business Development, Basic Education, Sassa and StatsSA.

“After this, we shared the revisions and updates done with the National Treasury and asked them for a meeting. Hopefully, this will either happen later this month or in early July for us to hear whether we have answered all the questions they raised,” Sibeko said.

Treasury had given the department a three-page document setting out questions to be answered before it could support the policy, Sibeko said.

She said Treasury’s feedback would determine the department’s next steps in finalising the policy.

Next steps and timelines

MPs asked how long the remaining consultations would take.

Sibeko said that after the July meeting with Treasury, the department would update the draft policy and submit it for a Socio-Economic Impact Assessment System review by the Presidency.

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If supported, the draft policy will return to cabinet for approval before being published for public consultation.

Following public consultations and further revisions, the policy will again be submitted through government approval processes before returning to cabinet for final approval.

Sibeko said the department was still aiming to submit the policy to cabinet for final approval by the end of March 2027.

SRD grant extension

She added that the department might need to seek another extension of the Social Relief of Distress (SRD) grant beyond March 2027 to ensure there is no interruption in support while the policy and legislative processes are completed.

Should cabinet approve the policy, amendments to the Social Assistance Act would be required before implementation could begin.

Acting DSD Minister Sindisiwe Chikunga said the success of the SRD grant had prompted government to explore a more permanent form of income support for working-age adults.

The R370-a-month grant was introduced in May 2020 and was only supposed to last six months. It has since been extended each year, with the latest extension running until March 2027.

About 8.5 million people benefit from the grant, Chikunga said.

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“The SRD grant has made significant contributions to shielding millions of South Africans from extreme poverty while enabling some to search for jobs or pursue other income-generating opportunities,” Chikunga said.

While the proposed BIS policy will build on the benefits of the SRD grant, Chikunga emphasised that it was “not a substitute for job creation”.

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