Speech by Linda Moss (ANC), MP in the State of the Nation Debate

18 February 2014

The Impact of Social Grants

Honourable President
Honourable Deputy President
Honourable Speaker
Honourable Ministers and Deputies
Honourable Members of Parliament
Distinguished guests

Honourable Speaker we have a good story to tell, South Africa is better today than it was under apartheid. ANC government is taking care of South African citizens from childhood to senior citizen. We developed a comprehensive strategy on Early Childhood Development (ECD). By end of 2012, 984 524 children were accessing ECD services in the country. There has been an increase in spending on ECD per child and spending is currently standing at R1.3 billion.

Speaker spending increased from R8 per child per day for 264 days per year to R15 per child per day for 264 days a year. The number of children receiving subsidy increased by 100% from 230 000 children in 1995 to more than 484 429 in 2012. The number of registered ECD sites has grown from 4 612 in 2004/5 to 19 971 by end of 2012/13.

The extension of the Child Support Grant (CSG) to all children under the age of 18 years was approved by ANC government in 2009 and is fully implemented. Currently there are 11 341 988 children in receipt of Child Support Grant. Indeed we have a good story to tell 94.2% of people have access to water, 84% have access to sanitation, 81% of our people have electricity, 71% of South Africans have refuse removal from their homes is in it a good story Honourable members.

We equalised the pensionable age or men and women at 60 years. We have more than 16 million people benefiting from social grants which allow the care-givers of children, the aged and those with disabilities to fulfil their basic needs and sustain their households. When the ANC government extends the access to social grants to 16 million South Africans it takes them out of abject poverty.

When the ANC declares all the schools in working class areas no-fee schools the beneficiaries are the working class. Appreciating that many of the kids in these schools are from poor households the policy of one meal a day in school is adopted.

The nature and effects of social grants programmes in South Africa against the backdrop of international trends in the reform of social assistance systems, shows that South Africa has a well-developed social assistance system that significantly reduces extreme poverty, because the grants are very well targeted. The review of existing literature and new evidence presented suggests that the grants influence the behaviour of recipients and potential recipients in various ways.

The literature review highlights a number of positive outcomes of state cash transfers delivered to impoverish and vulnerable people. These are delineated in four domains

  • Firstly social grants elevate welfare consumption and access to social services such as health and education
  • Secondly social grants generate potential economic benefits, such as improving recipient`s ability to manage risk and insecurity, facilitating savings and investment and supporting the development of local markets.
  • Thirdly social grants help to empower recipients in a social context.
  • Fourthly at an aggregate macro- social level, cash transfers have an important political effect in high inequality, post-repression contexts such as South Africa. They are an effective redistributive mechanism, thereby tempering social unrest. They have also symbolically served as an important part of the renewed social compact between citizens and state.

Despite South Africa`s transition from apartheid in 1994, the social landscape is still fragmented along racial lines.

South Africa needs to make structural changes to the real economy in order to address the pressing problems of inequality, poverty and unemployment. Research has widely confirmed the positive impact of social security interventions on the lives of poor children and their families.

A study conducted by the United Nations Children`s Fund (UNICEF) has shown that investing in children by means of social grants increases their access to health care, balanced nutrition and active early learning, all of which improve their overall wellbeing.

Honourable Speaker one cannot talk of the impact of social grants without reflecting on social transformation. Social transformation is a product of a deep realisation that the conditions under which we live and under which we may raise families are unacceptable and unjust.

Social transformation is also a product of the resolve by members of society who decide that no longer will they leave the future of their children to chance.

Through the ANC government the Inter-Ministerial Committee on Social Security and Retirement Reform made significant progress towards creating a more inclusive contributory social security system. This system is aimed at preventing working people from falling into poverty as a result to retirement, illness, disability or job loss due to economic upheavals by making contributions compulsory.

The government of the ANC can never accept people to live in inhumane conditions. People acknowledged the fact that health care provided to the sick among them is everyone`s collective problem, the drugs and crimes that rip families and communities apart is everyone`s problem. When education authorities, teachers, learners and parents recognise that they are on the same side, they begin to share a common goal.

Together we build better communities as together we take South Africa forward. Social transformation is a product of being conscious of social injustices; taking decisions to act on those injustices, of planning the course of action and of executing those plans.

Honourable Speaker the available data shows the significant progressive impact of the expanded grant system for households and individuals in the impoverished sectors of our population. If cash transfers were removed, poverty would rise from 54 percent to 60 percent.

Gains from the extensive reach of social grants, especially the child support grant, are well documented. The gains include at an aggregate level reduced poverty and inequality, as well as improvements in school attendance and hunger reduction. Qualitative research demonstrates that grants enhance reciprocity within households, local investment, trade, household care work and the functioning of informal networks that complement formal social assistance.

When combined with other government cash transfers to children and specific categories of people the impact of South Africa`s social grant system reduces the destitution gap by 47 percent. International studies show that more than half of additional income, such as remittances, government cash transfers and social pensions is allocated by poor families to increased food consumption. The resulting improvements in health and nutrition directly improve wellbeing and productivity.

Long-term planning challenges include ensuring that those young people over 18 years are able to make the transition into work or further education and training and do not fall back on the social assistance system. Growth in social assistance beneficiaries will not outstrip population growth given South Africa`s demography.

In conclusion, I want to reiterate, as a nation we must define what we want to become. This is what the National Development Plan does. To be able to do that, we must know what we are. Knowing what we are includes the recognition that as a nation we are not all that we would like to be. This is the responsibility of history, the recognition of what we are, what we want to be and the journey in between. In dealing with this, it is very important that we, as colleagues, as honourable members of this House understand, always, the burden of responsibility that rests with us.

I thank you