'Future policymakers' will have to decide on basic income grant - Mboweni

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Minster of Finance, Tito Mboweni.
Minster of Finance, Tito Mboweni.
Gallo Images/Jeffrey Abrahams
  • "Future policymakers" will decide whether the R350 social relief of distress grant will be replaced by a permanent grant, says Finance Minister Tito Mboweni. 
  • The current grant ends in March next year. 
  • Mboweni also says that he has not been pressured by the ANC to reinstate the grant.

Whether the R350 social relief of distress grant is a precursor for a basic income grant is up to "future policymakers", says Finance Minister Tito Mboweni. 

The grant ends in March next year.

The minister and other Treasury officials on Wednesday unpacked how support measures of R38.85 billion will be allocated to South Africans amid the Covid-19 pandemic.

The Social Relief of Distress Grant will be implemented until March 2022, the end of the financial year. It is expected to cost R27 billion. As to whether it will be extended beyond March 2022, possibly as a basic income grant, Mboweni could not provide a clear yes or no.

"Is this a precursor to a basic income grant or some permanent social support? The answer is, I do not know."

"What I know is that we do need to respond to the dire situation in which our people find themselves. And future policymakers - wherever they might be - may be able to answer the question more appropriately," Mboweni said.

He did not comment further on whether he will be among the policymakers. For now, he said government is dealing with the "current" situation - which is to respond to the economic impact of the pandemic and the recent unrest.

As to whether Treasury was pressured by the ANC to implement the grant, Mboweni said that was not the case.

"We operate within a society which experiences a lot of distress and any caring government has a responsibility to come to the support of its citizens. And that is why we are doing these things in these difficult times," he said.

"There was no pressure from the governing party. Incidentally, political parties do not rule, they govern by the will of the people. Only absolute monarchies rule, but political parties govern," he added.

About R36 billion of the relief package will be provided by tax revenue, which surprised on the upside - given the commodities boom that resulted in a greater tax windfall for the mining sector.

Commissioner of the South African Revenue Service (SARS) Edward Kieswetter noted that the financial services, manufacturing and mining sectors reported better-than-expected performance. Severus Smuts, director: indirect tax leader at Deloitte Africa, said that the better than expected revenues is also linked improvement in tax collection mechanisms by SARS.

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