Initial basic income should be limited to current COVID grant recipients - panel

The panel released its report on Monday after it was commissioned to investigate the feasibility of Basic Income Support under the supervision of the International Labour Organisation and the government.

Picture: EWN

JOHANNESBURG - While the panel on the Basic Income Support backs the implementation of a basic income grant framework – it said when considering the current economic and administrative constraints – the initial phase should be limited to the current COVID social relief of distress grant.

The panel released its report on Monday after it was commissioned to investigate the feasibility of basic income support under the supervision of the International Labour Organisation and the government.

It noted that the beneficiary numbers of the scheme that includes adults aged 18 to 59 could increase to 18.3 million people over the medium term.

Over the medium term, the Basic Income Support could cost R78.8 billion when covering people who currently qualify for the COVID social relief of distress grant with zero income.

However, this is not the only costing scenario presented in the report.

When considering the financing of the Basic Income Support, the panel stated that several models and their adverse consequences strengthen the argument that finances should be spread over several instruments and that grant expansion spaced as far as possible to leverage off benefits of economic growth.

Scenarios considered include setting the BIS level of benefits at R1,300 rand per month.

The panel added that overall, the differences in outcome between its scenarios indicate that coverage and the value of the grant matters.

However, indications were that even with the cautious entry-level version of the income support, the intervention levels are impactful in reducing poverty and inequality.

The government is expected to make an announcement on the scheme in next February’s budget speech.