Grant dependency rife

2018-04-25 06:01

The number of residents in households in the Free State’s Mangaung Metro Municipality reliant on grants is on the rise.

This is according to the 2018 South Africa Survey findings published by the Institute of Race Relations (IRR).

Findings revealed that the Mangaung Metro, alongside the Buffalo City Metro in the Eastern Cape, has a rate above 40%, and it is envisaged to increase.

The Mangaung Metro governs Bloemfontein, Botshabelo, Dewetsdorp, Soutpan, Thaba Nchu, Van Stadensrus and Wepener. The Buffalo City Metro governs East London, Bisho and King William’s Town, as well as the large townships of Mdantsane and Zwelitsha.

According to Gerbrandt van Heerden, IRR analyst, the increase in residents reliant on grants in these metros is due to the inability to attract investments and create employment opportunities.

He said Gauteng metros had the least households reliant on grants and that findings had revealed that households in Gauteng’s three metropolitan areas, Johannesburg, Ekurhuleni and Tshwane (Pretoria), relied less on social grants than those in the five metropolitan areas located in other provinces.

“The proportions of households receiving social grants in Johannesburg (29,4%), Tshwane (30,3%) and Ekurhuleni (31,2%) fall below the average of 33,8% for South Africa’s eight metros, and are significantly lower than the national average of 44,8%,” said Van Heerden.

“After the Gauteng metros, Cape Town is at fourth place, with 35% of households receiving social grants.”

According to Van Heerden, Gauteng’s metros account for 87% of the pro­vince’s population.

“This can be attributed to their relatively lower dependency on social grants, because the province is the single largest contributor to South Africa’s economy,” he said.

Van Heerden pointed out that the reduced reliance on social grants in Gauteng was influenced by:

  • A labour absorption rate of 52,6% in Johannesburg, 51,6% in Tshwane and 50,1% in Ekurhuleni in 2017 – higher than in any other metropolitan area except Cape Town, which has a rate of 53,9%.
  • A provincial expanded unemployment rate in 2017 (this includes people who have given up looking for work) of 32,9% – far lower than in any other province, except the Western Cape, which has a rate of 24,6%.
  • The proportion of people spending R10 000 or more per month, which is about twice as high in Gauteng as in seven other provinces.
  • The proportion of adults with a degree or higher qualification, which is 8% in Gauteng, compared to the national average of 4,9%.

“Two of Gauteng’s metros showed a decline in households receiving social grants. The proportion of households receiving social grants in Ekurhuleni fell from 31,6% in 2015 to 31,2% in 2016, while Tshwane saw a drop from 30,9% to 30,3% during the same period.”

Van Heerden has strongly emphasised that government needs to focus on re-energising the economies of South Africa’s other cities to encourage job growth and minimise reliance on state assistance.

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