This extension was announced on Wednesday afternoon, the 26th of October 2022 by the Finance Minister, Enoch Godongwana during his presentation of the Medium-Term Budget Policy Statement in Parliament.
He stated that “The SRD grant was introduced in May 2020 as a temporary measure to respond to the needs of the most vulnerable, who were affected by [Covid-19 induced] lockdown measures. It has been extended several times since then. Discussions on the future of the grant are ongoing and involve very difficult trade-offs and financing decisions.”
Treasury estimates that the SRD grant will increase by at least 8.8% annually, with a potential financial impact of R64.9 billion in the 2030–31 fiscal year, which would have an effect on the viability of the public coffers.
In light of these estimates, Godongwana asserted that an ongoing grant would seriously jeopardize the stability of the public coffers.
He further stated that any long-term extension or replacement will necessitate long-term increases in revenue, reductions in other areas of spending, or a combination of the two, despite the provision made in this budget.
The R350 grant will continue while the government figures out how to finance other options to act as a replacement for the grant or have a permanent grant in place for all qualifying applicants.
