South Africa’s long-debated plan to introduce a permanent Basic Income Support (BIS) grant is entering a decisive phase, with the Department of Social Development (DSD) confirming that formal funding consultations with the National Treasury will begin in March 2026.
The proposed grant, which has evolved significantly over the past several years, is expected to replace the temporary COVID-19 Social Relief of Distress (SRD) grant with a redesigned system aligned to employment and economic participation strategies.
Responding to a parliamentary question, Social Development Minister Sisisi Tolashe said the department has completed a re-costing of the policy and incorporated the updated figures into a draft framework. Macroeconomic modelling and implementation scenarios are currently being refined.
Funding sustainability remains the central obstacle. South Africa’s constrained fiscal environment, marked by slow economic growth and mounting revenue pressures, has complicated the introduction of any large-scale permanent grant.
From emergency relief to long-term social protection
The concept of a basic income grant was initially framed as a universal income for all adults. However, over time, economic realities prompted a shift toward a more targeted Basic Income Support model. Government policy direction now emphasises linking beneficiaries between the ages of 18 and 59 to employment services, training programmes and enterprise opportunities.
Tolashe described the SRD grant as a “transitional instrument” that allowed the state to test administrative systems and evaluate fiscal implications before committing to a permanent structure.
Currently, approximately 8.2 million people receive the SRD grant, while overall social grant beneficiaries total about 26.5 million. The 2026 national budget confirmed that social grants remain the largest component of social development expenditure.
Excluding the SRD extension, spending on grants is projected to increase from R246.6 billion in 2025/26 to R276.5 billion by 2028/29. To maintain continuity during the policy transition, government has allocated an additional R36.4 billion to extend SRD payments at R370 per beneficiary per month until 31 March 2027.
However, medium-term expenditure projections show a sharp decline in SRD allocations beyond that date, signalling the intention to phase in a redesigned grant structure. Only limited provisional funding is pencilled in for the outer years of the budget framework.
President Cyril Ramaphosa has repeatedly indicated, including during his State of the Nation Address, that a new form of income support based on lessons from the SRD programme will be introduced in 2026.
With assistance from the Presidency, the DSD has reviewed its draft policy and aims to finalise consultations in March 2026.
As South Africa grapples with high unemployment and widening inequality, the proposed Basic Income Support grant represents a significant policy shift—from short-term relief toward a more integrated social protection model tied to economic inclusion.
