FROM THE DESK OF THE PRESIDENT
10 July 2023
Dear Fellow South African,
This month, we celebrate the life and work of Nelson Mandela by recommitting ourselves to build the society to which he dedicated his life.
In everything we do this month to honour the founding father of our nation, let us recall his observation that, “while poverty persists, there is no true freedom”.
The achievement of democracy in 1994 was not an end in itself. It was a vital step towards the greater duty to narrow the gulf of inequality that sees a few South Africans live in comfort while most live in deprivation.
In 2005, at the launch of a global anti-poverty campaign, President Mandela said that overcoming poverty is not a gesture of charity: “It is an act of justice. It is the protection of a fundamental human right, the right to dignity and a decent life.”
Since the advent of democracy, we have dedicated great effort and resources towards alleviating poverty and reducing inequality. Through its substantial social protection programmes, government has provided vital support to millions of South Africans, lifting many out of extreme poverty and meeting many of their basic needs.
As we work to rebuild the economy, to create more employment and open opportunities for emerging businesses, we will continue to invest in the poorest and most vulnerable in our society. The funds we spend on social protection are not wasted; they make a real difference in people’s lives, both now and into the future.
Social protection in South Africa goes far beyond the provision of social grants for the elderly, children, people with disabilities and military veterans. It goes beyond the work of the Unemployment Insurance Fund, which provides income support for unemployed workers, or the Compensation Fund, which supports those involved in workplace accidents.
It encompasses all support provided to South Africans, mainly the poor, through what has become known as the ‘social wage’. This includes the provision of free basic services, health care, basic education, higher education, social housing and transport.
When debt servicing costs are excluded, around 60% of government’s budget is spent on the social wage. That is money spent on alleviating poverty and meeting people’s developmental needs.
To put this into context, government is funding free basic services to just over 11 million households. This enables poor people to access electricity, water, sanitation, and other services.
Basic education is provided to over 13 million learners, many of whom attend no-fee schools. Health care is provided for the 50 million South Africans that don’t have private health insurance. Then there are the millions of families whose lives have been changed through the provision of subsidised housing.
Social protection includes public and social employment programmes, which provide unemployed people with income, work experience and training opportunities. Recent programmes have shown great success as pathways for people into employment or other ways to earn a livelihood.
A recent World Bank assessment noted that our grant and social assistance systems play a critical role in mitigating poverty. The report found our systems and programmes to be “effective, well-targeted and providing sizeable benefits to the poorest households”.
While some people refer to the various forms of support to poor people as ‘handouts’ or as a wasteful drain on our fiscus, our social support programmes are an investment in South Africa’s people. It is not correct to say that these programmes breed dependency or discourage people from looking for jobs.
Indeed, a paper published in 2014 by the Brookings Institute noted that, “social assistance may well be just what many in South Africa need, enabling them to actively pursue a job search, move out of a poverty trap, and take control of and direct their futures.”
The provision of comprehensive social protection will not, on its own, end poverty or inequality in our society. To really end poverty, we need an economy that grows, attracts investment, creates jobs and allows new companies to emerge and thrive.
Our policies and programmes therefore need to work together to build an inclusive economy and provide social protection to the poor and unemployed. A growing economy provides the funds we need to strengthen our social protection measures, while the support that poor people receive, especially in access to education and health, enables them to better contribute to the economy.
Because expansion of social protection can only take place at the pace and scale the fiscus can afford, we are focused on growing our economy and developing sustainable solutions to support pro-poor spending.
Through an integrated and comprehensive system of social support, we are not only meeting our collective responsibility to the most vulnerable in society. We are also investing in our country’s future.
With best regards,
Cyril Ramaphosa
