DION GEORGE: DA’s commitment to social grants is a step ahead of the ANC

With national elections fast approaching, in what promises to be a game-changer for SA, the ANC’s misinformation campaign is ramping up. The governing party, accompanied by its array of counterfeit splinter parties, has revived its lies to suggest that the DA does not support a safety net for vulnerable South Africans. A quick look at the DA’s alternative budgets and policies exposes this as nonsense.

The SA public is no longer susceptible to the governing party’s groundless fearmongering tactics. It does, however, remain important to clarify the facts. No country can develop or sustain itself without the bedrock of social protection, and SA is no exception to this fundamental principle. Recognising this, the DA has always placed a high value on social development within its policy offering.

The party has repeatedly voiced its commitment to maintaining a basic level of dignity for all through its support for social grants — the assurance of a strong and wide-casting safety net, or a floor below which nobody need fall. This dedication will be central to nurturing a stable and prosperous society that embodies the spirit of a vibrant, humanitarian-focused economy.

While social welfare mechanisms can never fully substitute for economic growth and employment creation, they are essential in safeguarding the most vulnerable against severe poverty. It is for this reason that social grants are enshrined as a constitutional right, and any assertion that the DA would abolish them upon gaining national power is therefore unequivocally untrue.

In nurturing a society where social grants are necessary and valued, we must also consider the institutional framework that upholds these values. SA’s constitution outlines both the tangible and intangible pillars that are essential for holistic development. Its dual focus on building robust economic structures and nurturing societal values is the driving force behind a balanced and forward-moving economy.

Present-day ANC leaders are more preoccupied with boasting about their success in increasing state dependence among citizens than leveraging key institutions to elevate as many South Africans as possible from poverty. This has ensured that socioeconomic indicators across the board are now signalling distress. The pressure on already struggling citizens is intensifying, and the erosion of the middle class is accelerating. The ANC shows no sign of commitment to addressing economic hardship.

What South Africans are not being told is that if the outlook for growth remains weak and tax administration reform remains at a near standstill, the country’s fiscal position will deteriorate further unless extended spending cuts are realised. Worse still, this disconnect has grown so profound that the party, in its continuous misrepresentation of SA’s fiscal situation, has become a victim of its own propaganda.

Even though the social relief of distress (SRD) grant exerts significant pressure on the fiscus, it remains both an economic and moral imperative. However, what is becoming increasingly evident is that should the ANC remain in power and the status quo does not change, the future of such grants is bleak.

So why is it that the DA’s social development policy is affordable when, of course, it is politically very hard to cut spending? It is because there is another way to save money. The issue is not so much that there is a lack of funds in SA, but rather how it is spent. Right now we are borrowing more at an increasing pace and at increasing rates.

Debt is supposed to be used for investment in long-term projects that will increase capital formation. Instead, the government has opted for short-term consumption expenditure. Whatever amount is left is then wasted in an inefficient, race-based procurement framework that is laden with red tape and internal mismanagement.

A reformed state procurement system could yield savings of up to 20% of the government’s expenditure on goods, services and public works. This amount equates to about 1.3% of GDP or 20% of consolidated government spending in these areas. The DA’s Social Impact Bill is a step towards addressing these concerns.

A credible budget is vital for effective governance and economic stability. Yet there is a widening gap between budget plans and actual execution. In the past three years annual government spending has overshot budgeted amounts by significant margins, ranging at R20bn-R60bn. These overruns can be partially attributed to external shocks such as the Covid-19 pandemic and floods, but they are largely the result of failures within the government.

The growing disconnect between policy and budget efforts is even more troubling. An example is the ambiguous and inconsistent approach to the SRD grant. The 2023 national budget did not account for the grant’s extension beyond the 2023/24 fiscal year. Yet, as per the 2023 medium-term budget policy statement, funds were suddenly allocated for an additional year’s extension, without any clear plan for the future. This suggests the ANC is using the SRD, along with other grants, as a political tool.

Moreover, it appears that the National Treasury is using the medium-term expenditure framework more as a negotiating stance than a serious fiscal planning tool, which is eroding the credibility of the budget.

Unlike our opponents, the DA does not consider South Africans to be pawns in political games, and our vision of a social safety net differs significantly from the current system in multiple fundamental aspects. In short, our enhanced model is more sustainable. It is rooted in a healthy economy that relies on increased revenue generation instead of debt accumulation.

It will provide more robust support for the young, elderly, disabled and vulnerable. Our enhanced model is feasible because the DA’s social safety net is envisioned within a thriving economy that has a zero tolerance for corrupt management of public funds. With more economic activity and more people working, tax revenue will increase and can be allocated to social welfare programmes without increasingly burdening an ever smaller pool of beneficiaries.

Our safety net also has a unique “trampoline” feature that is designed to assist individuals in regaining their independence. We prioritise enabling people to become self-sufficient and move away from perpetual dependence on the state.

A truly compassionate and caring state empowers its citizens towards self-reliance. It supports meaningful social welfare for those in need, not by indebting future generations but by nurturing a robust economy capable of funding these initiatives.

• Dr George is DA shadow finance minister.