BRETT HERRON: Basic Income Grant only way to bridge gap between suffering and thriving economy

The extent of poverty is the single greatest existential threat SA faces. It grinds people down to the extent that they become dislocated from the sense of common purpose societies need to function and develop.

Political parties are falling over each other with fantastic promises of creating millions of jobs. But they’re not saying how people should survive in the interim.

Creating sufficient jobs to address the backlog and the needs of a growing population requires a sustained period of far stronger economic growth than anyone has forecast lies ahead — such as 6% growth for 10 or 15 years …

The extent of poverty places SA on a powder keg. It has created a fertile environment for dissatisfaction, low self-esteem, social instability, economic instability and criminal impunity. It is an environment that is counterproductive to economic growth and has led to capital flight, the opposite of investment.

We spend billions of rand treating the symptoms of poverty — from broken families to cable theft, fixing infrastructure damaged during service delivery protests, substance abuse and all kinds of petty crime — instead of spending money on mitigating poverty.

That’s besides the constitutional imperative, contained in section 27(1), that unequivocally states that no one should live in conditions of abject poverty: “Everyone has the right to have access to … (c) social security, including if they are unable to support themselves and their dependents, appropriate social assistance.”

If the economy is unable to generate enough livelihoods, the burden of “enabling people to support themselves” falls on the state. The state’s current response to fulfilling this obligation is the Social Relief of Distress (SRD) grant, initially introduced in response to the Covid-19 pandemic.

Hasn’t kept up

It pays R370 per month to about 8.5-million recipients. The government-set food poverty line, the monthly amount individuals need to afford the minimum daily energy intake, is R742. The SRD grant is therefore exclusionary, discriminatory and wholly insufficient to enable those fortunate enough to receive it to sustain themselves.

Unlike other grants, the SRD grant can be applied for only online, requiring digital hardware and expertise many people don’t have. And, unlike other grants, applicants are subjected to means tests that scrutinise their bank statements without making provision for ad hoc money receipts, such as money sent to the applicant for children or grandparents, or loans.

A year ago there had been 14.4-million applications for the SRD, but only 8.2-million had been paid. The grant hasn’t kept up with inflation since being introduced three years ago.

The only short-term tool available to bridge the current period of suffering to that of a thriving economy in future — indeed, to enable the economy to get there — is a nonexclusionary basic income grant (BIG).

Political parties with supporters who largely don’t need a BIG, because they have livelihoods, raise two categories of issues with it. They say the country can’t afford it, and that it is wrong to give people money when they don’t work for it.

Of course, affordability is a factor. But the idea that people who don’t work for their money should simply starve, directly mirrors the apartheid government’s approach to people of colour.

BIG SA

Two years ago the GOOD party contracted the services of a professional economist to crunch the numbers of the country’s economy, tell us what level of BIG SA could afford, and where the money would come from.

This research has underpinned our campaign over the past year for a BIG of a minimum of R999 a month to all adults without jobs. For context, the upper-bound poverty line, which includes food and other minimal household expenses, is officially set at R1,588.

We have calculated that R999 is affordable, largely through revising our approach to budgeting to exclude nonpriority and redundant expenditure and programmes, reducing the number of government departments and cutting spending on the provincial tier of government. In this way, a BIG will not add to the debt burden.

The BIG must be inclusionary, not exclusionary. Recipients must not be subjected to jumping through digital hoops or dysfunctional means tests. Because of the high rate of unemployment, the state of the economy and projected economic growth, the uptake of the BIG will initially be substantial. As the economy grinds into gear again — in a stable society — and begins to generate jobs, the demand will diminish.

Research has clearly shown that the overwhelming majority of unemployed recipients of social grants in other countries would far prefer to have a job, and the extra money and better lifestyle a job brings.

The BIG will not create a nation of layabouts. But it will alleviate the pressure cooker of indignity and hopelessness that extreme poverty and exclusion create. It is an investment in justice and stability that SA, and its economy, can ill-afford to delay.

• Herron is GOOD party secretary-general and MP.