Public Management

SA’s govt says it will maintain basic income project despite Covid-19 and economic crisis

SA’s govt says it will maintain basic income project despite Covid-19 and economic crisis
Tuesday, 12 January 2021 13:38

The South African government says it will introduce a population-targeted universal revenue system by the end of this year. Speaking during the 109th anniversary of the ANC party, President Cyril Ramaphosa (pictured) said the project will help establish a social safety net for the poor people in the country and improve the existing social aid systems.
  
The basic income or universal income is an amount allocated to the population at a specific periodicity, individually and unconditionally. An official ANC document, relayed by Bloomberg, revealed the amount is R500 ($32) for citizens aged 19 to 59 who are not eligible for other forms of assistance.

The government sees the project as a more sustainable and secure solution, as the allocations initially set up to deal with the covid-19 pandemic are set to end soon. As a reminder, although the initiative has been on the government’s agenda for years, the fallouts of the coronavirus pandemic have highlighted its urgency. Indeed, the negative prospects such as the increase in the unemployment rate during and after the crisis reinforce the need to implement this system.

However, its deployment is hampered by the difficult economic situation suffered by the rainbow nation. According to several observers, South Africa does not have sufficient economic resources to engage in such a project. For 2020, the country expects an estimated growth of -7.8%.

Also, the liquidity problems of public enterprises (Eskom and SAA) which have weighed heavily on the state finance in recent years, coupled with investment needs in key economic sectors are another barrier to the universal income system.

“This year, the ANC, government and broader society will need to continue discussions on the desirability and viability of a basic income grant to provide a social safety net to the poor,” the President said.

Despite this scenario, the government argues it bets on tax levies on salaries to recover the amounts to be granted under the universal basic income system.

Additional Info

  • communiques: Non
  • couleur: N/A
On the same topic
• Central African Republic seeks $12B for 2024-2028 development plan• 58 projects target agriculture, mining, energy, transport, and health• Goal:...
• S&P Global Ratings lowered Botswana's sovereign credit rating to BBB from BBB+, maintaining a negative outlook.• The downgrade stems from collapsing...
• Only six of Nigeria's 13 listed banks currently meet the Central Bank of Nigeria's (CBN) new recapitalization requirements.• The CBN significantly...
• Kenyan lender Equity Bank has initiated steps to enter the Ethiopian banking market, recently opened to foreign investment.• Ethiopia offers a market of...
Most Read
01

From Dakar to Nairobi, Kampala to Abidjan, mobile money has become a lifeline for millions of Africa...

Africa's Boundless Future: How a simple mobile phone became a pocket bank for millions
02

Nigeria’s fintech landscape has undergone a seismic shift in recent years, driven largely by persist...

In Nigerian, Bank Technology Failures Pushed OPay and PalmPay to Leadership in Daily Payments
03

• WAEMU posts 0.9% deflation in July, second month in a row• Food, hospitality prices drop; alcohol,...

WAEMU Region Records Second Straight Month of Deflation, at -0.9% in July 
04

Airtel Gabon, Moov sign deal to share telecom infrastructure Agreement aims to cut costs, boo...

Gabon’s Airtel, Moov to Share Towers Under Govt-Brokered Deal
05

• Benin’s FeexPay and Côte d’Ivoire’s Cinetpay receive BCEAO payment service licenses• Both firms ex...

WAEMU fintech industry strengthens with two new BCEAO regulatory approvals
Enter your email to receive our newsletter

Ecofin Agency provides daily coverage of nine key African economic sectors: public management, finance, telecoms, agribusiness, mining, energy, transport, communication, and education.
It also designs and manages specialized media, both online and print, for African institutions and publishers.

SALES & ADVERTISING

regie@agenceecofin.com 
Tél: +41 22 301 96 11 
Mob: +41 78 699 13 72


EDITORIAL
redaction@agenceecofin.com

More information
Team
Publisher

ECOFIN AGENCY

Mediamania Sarl
Rue du Léman, 6
1201 Geneva
Switzerland

 

Ecofin Agency is a sector-focused economic news agency, founded in December 2010. Its web platform was launched in June 2011. ©Mediamania.

 
 

Please publish modules in offcanvas position.