SASSA: Billions returned to government due to low applications for SRD grants

SASSA: Billions returned to government due to low applications for SRD grants. A Social Relief of Distress (SRD) grant provides essential funds for basic necessities like food to millions of unemployed individuals in South Africa. A substantial amount of money earmarked for SRD grants is being returned to the government by the South African Social Security Agency (Sassa), according to recent revelations.

Lower-Than-Expected Grant Applications

The funds allocated for SRD grants are not fully utilized by Sassa, despite the significant unemployment rate of 32.6%. The National Treasury returned R4.3 billion meant for social relief of distress grants in the previous financial year. Despite the fact that funds intended to alleviate the financial burdens of eligible beneficiaries are underutilized, this unexpected development raises questions.

Factors Contributing to the Returns

The Department of Social Development (DSD) attributes the substantial return of R4.3 billion to a lower-than-expected uptake of the SRD Grant. Although the government had budgeted for a greater number of beneficiaries, the actual number of SRD Grant applications fell short of expectations.

Eligibility Verification Process

The DSD points to the intricate assessment process for SRD Grant applicants as a significant factor in the funds’ return. Monthly evaluations ensure that recipients meet all eligibility criteria. This process involves collaboration with various state entities, government departments, and banks.

SRD Grant Examination and Extension

In November 2023, Finance Minister Enoch Godongwana announced a surprising extension of the SRD grant, which was originally set to conclude in March 2024. With the extension, beneficiaries are now able to collect grants until March 2025, which is expected to cost R34 billion. This extension contrasts with earlier warnings about escalating debt levels impacting government services.

President Ramaphosa Perspective

SRD Grant has had a positive impact on millions of lives, according to Cyril Ramaphosa, who noted that the R350 grant introduced in 2020 had prevented millions from going into extreme poverty. The return of funds to the Treasury reflects efficiency in the assessment process, but it also raises concerns about reaching the intended beneficiaries effectively.

Conclusion

Understanding the reasons behind the lower uptake is crucial for refining the SRD Grant program, ensuring deserving individuals receive the financial support they require. The unexpected extension underscores the grant’s importance but raises questions about the government’s fiscal challenges in maintaining such initiatives.