Sameera Casmod | sameerac@radioislam.co.za
1 November 2024 | 10:21 CAT
2-minute read

Urgent need for Universal Basic Income Grant (UBIG) in SA

Civil society organisations are once again calling on the government to implement a UBIG to alleviate financial strain on households and reduce poverty, particularly among the youth. A UBIG refers to a government program that provides a regular payment to every adult citizen, regardless of their income, gender, race, or age.

Senior Research Associate Dr Imraan Buccus from the Auwal Socioeconomic Research Institute (ASRI) explains how a grant will reduce youth unemployment in the country and ultimately improve social stability and reduce the risk of mass uprisings during this week’s ASRI Report.

Statistics indicate that over 60% of young people are unemployed, which is more than double the country’s unemployment rate of 32%.

“That’s a huge concern: that more and more young people are without jobs, without education, without training. And they’re facing a future completely devoid of opportunities and hope. And we know from much of the evidence around the world that an instrument like a basic income grant can go a long way to addressing that,” Dr Buccus said.

Despite the ebb and flow of discussions around a basic income grant, implementation remains a challenge. The recent Medium Term Budget Policy Statement by the finance minister has sparked concerns about cuts to social programs, with questions arising about whether the Social Relief Distress (SRD) grant will extend beyond 2025.

The high unemployment rate in a country whose population is made up of a majority of young people under the age of 30 means that an entire generation of people will be completely shut out of the South African economy, which perpetuates the cycle of poverty and ultimately results in social instability.

Dr Buccus cites evidence from other countries around the world where basic income grants had positive effects, including the Programa Bolsa Familia (PBF) which was introduced in 2003 by President Lula da Silva. The programme included cash transfers to poor families on certain conditions.

“It had a massive positive impact, that about 7-8 years later, Brazil was able to reduce poverty by about 65%. And in a country like South Africa, if we are able to achieve that, it will be phenomenal,” Dr Buccus said.

Addressing concerns regarding the country’s existing corruption, the Institute maintains that a UBIG could work with proper oversight.

While some conservatives have voiced the opinion that a basic income grant will serve to further reinforce South Africa’s identity as a “nanny state” in which people become lazy to work while they receive tax-payers money, left-leaning progressive economists argue that there is ample evidence to prove the benefits of a social grant programme.

Dr Buccus said that social grants have shown a positive impact on poverty, even if inequality remains high, adding that economic stability and reducing poverty ultimately benefit all South Africans, regardless of class. He cautioned that ignoring youth unemployment’s long-term effects could lead to severe consequences, including potential social fragmentation and unrest in the future.

Listen to the ASRI Report on Sabaahul Muslim with Moulana Sulaimaan Ravat.