The Social Relief Distress Grant which is a fancy word for unemployment in South Africa rises in June from R350 per month to R370. This is roughly worth around $20 and this does not help as this is just too little to think people can survive on this amount. This is an insult to the people and the government should be fixing the economy at least to give their people some hope of being able to work.
The government says that roughly 45% of the population receives some sort of grant and you have to think realistically this is over 50%, but any figure under 50% sounds better. The increase this year in the budget interestingly enough does not include 2026 and ends at the end of this current financial year. The government says they are trying to incorporate this unemployment grant into some form of pathway to employment.
One would have to think this is wishful thinking on their part as the economy is not growing and businesses are still in survival mode so employing more staff adding to their overheads is not on the horizon or even close. The unemployment or SRD Grant was introduced during COVID due to job losses and the R25 billion fund will come to an end next year April. What the unemployed do then God only knows because the Government is hoping for an economic miracle that they have no answers. I personally doubt the SRD grant will disappear otherwise they would have a riot on their hands.
The one train of thought was turning the SRD grant into a job seekers allowance instead, but was seen as a bad idea as not only is seeking work a costly exercise there is not much opportunity for work available. If the economy doe not grow companies are stagnant, wages do not rise and there is no hiring of staff.
The SRD grant is less more today than when it was introduced back in 2020 where the then R350 which is now R370 is worth around R290 if you take into account inflation. This money does not even cover buying a loaf of bread daily so the majority of the country is living under the poverty line and then you wonder why the crime rates are so high. Unemployment and crime go hand in hand and the scary part is the unemployment figures continue to rise.
9% Of The Population Pay For 40% Of Entire Tax Bill
1.5% Of Taxpayers Pay 61% Of All Income Tax Collected
The pressure is on the budget next year to not implement new tax increase taxing the overtaxed businesses and those that do work even more. Back in 2020 SA had 5.2 million personal income tax payers with roughly 20% of this group accounting for 35% of the total tax bill. Since then this number has been decline as people have just had enough of funding the rest and have emigrated. The tax pool is shrinking and why the concerns the Government will just raise taxes even more.
An estimated R500 million is stolen via corruption daily which is R180 Billion per year.
The biggest employer in SA is the government with over 1.4 million civil servants which tells you how top heavy they are as nothing ever seems to get accomplished. They cannot employ the 50% or more that are unemployed. The 2025/26 budget needs to find an additional R58 billion to make ends meet and why the government is being creative finding new ways. We had a new tyre levy introduced 2 years ago which was madness and we know they are going to adjust the fuel levy this month. To put things in perspective 20 years ago personal income tax was 19% of GDP and today it accounts for 25%. That is a 30% swing and why we are definitely over taxed.