Budget: social grants go up, but not as much as inflation

Covid grant budget slashed by R8-billion

By Marecia Damons

22 February 2023

Finance Minister Enoch Godongwana announced increases to social grants, but these are not in line with inflation. Archive photo: Ashraf Hendricks

Finance Minister Enoch Godongwana has announced increases to social grants during his Budget Speech on Wednesday, but these are lower than the inflation rate.

The minister allocated R36-billion to fund the extension of the Covid-19 Social Relief of Distress (SRD) grant until 31 March 2024. This is down by R8-billion from the previous SRD budget of R44-billion.

He said that R30-billion would be used for inflation-linked increases for other social grants. But the grants do not keep pace with inflation, currently running at 6.9% between January 2022 and January 2023 according to StatsSA. Food prices are rising even faster, up more than 13% over the year.

Changes to grants this year are as follows:

Godongwana did not mention the other grants in his budget speech.

The inflation rate for pensioners according to StatsSA is even higher than the 6.9% inflation rate, at 7.6% a year.

Godongwana allocated R2.4-billion to the South African Post Office. He said this “will be accompanied by strict conditions to ensure sustainability, accountability and transparency”.

“If the conditions are not met, the money will not flow,” said Godongwana.

He acknowledged that “households are under pressure from the rising cost of living”. “This is not an austerity budget,” said Godongwana. “It is a budget that makes tough trade-offs in the interests of the country’s short and long term prosperity.”