In this just-published article in The Conversation, Saldrupians Ihsaan Bassier, Josh Budlender, Prof. Murray Leibbrandt, Prof. Vimal Ranchhod and Rocco Zizzamia argue that South Africa’s lockdown will hit informal workers and their households hardest and that a top-up to the Child Support Grant (CSG) is needed to mitigate this impact.
Government’s approach to providing relief to households has until now been focused on the formally employed through the Unemployment Insurance Fund (UIF). While necessary, these relief measures exclude approximately 45 percent of South Africa’s workers and the households that depend on their income. These informal workers will suffer the most during the lockdown. Without relief measures targeted at these workers’ households, the decline in earnings in the informal sector will result have a devastating impact on poverty and food insecurity in South Africa. Extreme poverty rates will almost triple for those households with informal workers.
However, the authors argue that a mechanism to target support to these households exists: the CSG is effective at reaching households which depend on income from the informal sector – especially among the poorest deciles. Thus, an immediate (and temporary) increase to the CSG will compensate the most vulnerable for this loss in income.
A top-up to the CSG would be immediately effective in preventing dramatic increases in extreme poverty.
And size matters: a R500 per month top-up will be much more effective than a R250 top-up. Not only will a top-up to the CSG be highly effective, it can also be implemented immediately using the existing social grant infrastructure, and will not be prohibitively expensive.
Delaying a top-up to the CSG endangers not only the livelihoods of those households which will be worst hit by the lockdown, but will also undermine the lockdown itself as households are forced to continue working and trading to survive.