Govt allocates over half of R2 trillion spending budget to social services

Culture and learning remain the largest spending area at R402.9 billion with the bulk of that allocation earmarked for salaries.

Finance Minister Tito Mboweni delivers his Budget speech in Parliament on 24 February 2021. Picture: GCIS.

JOHANNESBURG - Government has allocated more than half of the country’s R2 trillion spending budget for this year to social services.

Culture and learning remain the largest spending area at R402.9 billion with the bulk of that allocation earmarked for salaries.

This is followed by health, which stands at R248.8 billion a slight increase from R230 billion last year.

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Government said the decision to spend R987.1 billion or 56.8% of allocations in this year's budget is in line with its pro-poor policies.

Treasury has also earmarked more than R28 billion in the next three years in standalone conditional grants to provinces and municipalities that will allow them to upgrade informal settlements.

This forms part of proposed changes to the structure of conditional grants, which Treasury said was meant to align with evolving policy objectives.

READ: Mboweni announces R30 boost for old age, childcare grants

The social services allocations, however, also reveal some reductions, which include health spending where just over R50 billion will be cut in the next three years.

That will largely affect salaries over time and variations in unit costs in HIV programmes.

Meanwhile, in education, Treasury raised serious concerns with the running of the National Student Financial Aid Scheme, which it believes will require a review of student enrolment growth and bursary allowances due to slower growth in subsidies and grants.

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SOCIAL GRANT INCREASES NOT KEEPING UP WITH INFLATION

For those who rely on social grants to get by, their increases will not even keep up with inflation.

Treasury documents reveal the social grant budget will be reduced by 2.2% over the next three years with decreases for this year totalling R5.8 billion.

All grants have been hiked by less than the cost of inflation with the highest increases in real value were seen at the old age grants.

They go up by R30 a month, from R1,860 to R1,890 with those over the age of 75 getting R1,910 a month.

Foster care grants received the smallest increase - a mere R10 a month bump.

Mboweni explained social development has been allocated R335.3 billion.

“We are in a situation where we are now choosing social grants, schools; we are now no longer spending on anything that we can’t - like old-age pensions and foster grants.”

Over 18 million South Africans are beneficiaries of the social grant system, with Treasury saying that it expected 300,000 more people to be added to the system in the next three years.

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