South Africa is moving closer to introducing a new social welfare system as the government works toward finalising its proposed Basic Income Support (BIS) grant, a programme expected to replace the long-running Social Relief of Distress (SRD) grant.
The Department of Social Development (DSD) says it aims to complete the policy framework by March 2027, paving the way for legislation and implementation during the 2027/28 financial year.
The planned reform represents one of the most significant changes to South Africa’s social assistance system since the introduction of the SRD grant during the Covid-19 pandemic.
Temporary Covid Grant Evolved Into Long-Term Support
The SRD grant was introduced in 2020 as an emergency measure to help vulnerable South Africans cope with the economic fallout of the pandemic. Initially set at 350 rand per month and later increased to 370 rand, the programme was originally expected to last only six months.
However, demand remained high long after pandemic restrictions ended. More than eight million people currently rely on the grant, forcing the government to extend the programme repeatedly.
The financial burden has also grown substantially. Treasury allocates between 35 billion rand and 40 billion rand annually to maintain the grant, while the 2026 national budget included an additional 36.4 billion rand to continue payments until 31 March 2027.
Despite its cost, government officials argue that the programme has delivered measurable benefits. Studies commissioned by independent researchers found that the grant helped reduce poverty, hunger and inequality, while enabling recipients to search for work and participate in economic activities.
According to the DSD, beneficiaries primarily spend the money on food, electricity and clothing, generating economic activity within local communities.
The success of the programme has strengthened support within government for a more permanent income-support mechanism.
President Cyril Ramaphosa has repeatedly endorsed the concept and reaffirmed during his 2026 State of the Nation Address that work on the new system would continue this year.
New Policy To Link Welfare With Employment Opportunities
Unlike the SRD grant, the proposed BIS programme is being designed with a stronger focus on employment and economic participation.
Government officials say the policy aims to support working-age adults while simultaneously connecting them to job opportunities, skills development initiatives and sustainable livelihood programmes.
The department believes this approach will help recipients gradually transition away from dependence on social assistance and into productive economic activity.
Development of the policy has been underway for several years. An initial draft was presented to Cabinet in November 2024 but was returned for further refinement. Authorities requested stronger provisions linking income support to employment-seeking activities as well as updated cost projections.
Research commissioned by the department was completed in February 2026, leading to substantial revisions. The updated framework now includes an institutional design outlining how beneficiaries could be linked to employment and economic opportunities.
The DSD and the Presidency submitted the revised policy to the National Treasury in March 2026 and conducted consultations with other government departments in May.
According to the department’s implementation roadmap, consultations with Treasury will continue through June and July 2026. A revised policy will then be submitted for impact assessment before being presented to Cabinet in August for approval and public comment.
Following additional revisions, final Cabinet approval is targeted for March 2027.
Should the policy receive approval, amendments to the Social Assistance Act will be drafted, with the legislative process expected to begin during the 2027/28 financial year.
The timeline remains ambitious, but if completed as planned, the BIS could become the cornerstone of South Africa’s future social protection framework and affect millions of low-income citizens across the country.
Source: Department of Social Development (DSD).