ANC punts social safety net as voter support wanes

The ANC, fighting to extend its 30-year grip on power in the May 29 elections, would like to cast the government programmes that support Dalene Raiters and her family as a success story.

But the 48-year-old does not see it that way.

“The ANC, I don’t want to even talk to them,” an angry Raiters told Reuters from the single room in Johannesburg she shares with her sons and grandson. "[Nelson] Mandela’s dream is not their dream.”

The ANC is touting SA’s welfare system — a developing world rarity — as a landmark achievement amid record high unemployment and a moribund economy.

“These grants and subsidies do much more than give people what they need to live,” President Cyril Ramaphosa said in February. “They are an investment in the future.”

But the growing number of people requiring assistance — more than 24-million in 2024, against a tax base of just 7.1-million — is straining the system. Its future could depend on whether it chooses the EFF or DA as a coalition partner if it loses its majority, as polls suggest.

“It’s an enormous mark of failure, and it is not sustainable.... We’re on a very risky path,” said Ann Bernstein, director of the Centre for Development and Enterprise.

Economic failure

Social security and economic prosperity were bedrock tenets of ANC policy in 1994.

But today more than 60% of South Africans live in poverty, according to the World Bank, while a decade of economic stagnation has pushed unemployment above 32%, nearly 10 points higher than 30 years ago. More than a third of the population receives cash grants and other social support.

During the Covid-19 pandemic, the government created the social relief of distress (SRD) grant, a new benefit for working-age unemployed people, which has accessed by more than 6-million people. Though meant to be temporary, it was extended earlier in 2024, against the advice of finance minister Enoch Godongwana.

For Thabo Mbeki, the welfare system was never intended to be a cure for poverty and unemployment. Instead, the goal was to grow an inclusive economy so more people could earn an income.

“That hasn’t worked as well as it should. And I think that objective, we need to get back to it,” he said.

Raiters lost her job at a local primary school 16 years ago. Her adult son is also jobless. Like many South Africans, their entire family of four lives off the grants of those who qualify.

For Raiters that means the R1,080 a month she receives for two minor dependents — her teenage boy and grandson supplemented with handouts from a local mosque, feeding schemes or odd jobs she does for neighbours.

It’s never enough.

“Sometimes it breaks my heart,” she said, in tears.

‘Doomsday coalition’

While the ANC denies it will need a coalition, most polls predict an end to its single-party governance after May 29.

The DA would seem an awkward fit. While it is promising to increase the value of select grants and convert the SRD grant into a jobseekers grant, it is primarily focused on job creation. It also wants to relax labour laws and do away with affirmative action.

Though the DA squarely blames the ANC for the country’s current troubles, it has not ruled out partnering with its ideological opponent to prevent what leader John Steenhuisen dubs a “doomsday coalition” of the ANC and the EFF.

“I’ve seen the mass emigration from places like Zimbabwe and Venezuela. I’ve seen the starvation,” Steenhuisen said. “I don’t want that for SA.”

The EFF, which has stated its desire for the finance portfolio were it to partner with the ANC, did not respond to repeated requests for an interview.

The party’s election manifesto calls for a doubling of existing social benefits across the board, the establishment of a new grant for unemployed university graduates and more free public services for the poor.

Southern Centre for Inequality Studies economist Michael Sachs said the system currently had the resources to support its intended beneficiaries: children and pensioners.

What it cannot do is cope with the effects of skyrocketing unemployment and formal sector stagnation.

“If those social problems continue to mount and the only answer of government is to provide more social grants, then eventually it will become unsustainable, definitely,” he said.

For Raiters, the answer is not more welfare benefits: only work will give the next generation a chance.

“I know I’m not going to live a long time,” she said. “But for the future, I hope my grandson can get a better job.”

Reuters