Social grants inadequate to mitigate rising food prices

14 April 2016

South Africa continues to suffer the consequences of the driest drought on record. The drought, now classified as a “socio-economic drought”, has devastating consequences for the 34 million people who are currently being affected by it.

The DA is deeply concerned about the poor and vulnerable in our society and their ability to afford food. This is set to get worse as the impact of the drought deepens.

The latest crop estimates for 2015/2016 planting season indicates that total grain production will be down by 28% given a best case scenario. As a result of the decreased crop yields, supply simply cannot keep pace with demand. 

The implication is that food prices have risen steeply over the past couple of months and will continue to do so over the course of the year. In fact, acording to PACSA, an average food basket increased year-on-year by 16.20% for February 2016.

 The South African society already suffers from extremely high unemployment with 8.2 million people are currently without jobs in South Africa, or have given up looking for jobs. 

These citizen are often dependent on grants for survival, whether their own or grants received by other qualifying household members. It is they who will suffer the most as food gets more expensive.

In his budget speech in February, Finance Minister Pravin Gorhan announce modest increases to social grants. These are, however, completely inadequate to offset the drastic increase in food prices.

In order to see what the impact would be on actual South Africans, the DA purchased a trolley for goods for a fictional family of 5 based on their minimum nutritional requirements for a month. The total cost of this trolley was R3 585.53.

If we compare this with the earnings of a family that relies on grants, we find that they will not be able to afford to buy enough food to meet the minimum nutritional requirements. 

 Importantly this does not include rent, water and electricity, school fees, household cleaning products, toiletries or transport fare, which is all essential monthly expenditures for every single South African household.

 In order to cut costs to feed their families, grant recipients often end up buying cheaper food stuffs that are not as nutrient-rich as for fresh produce, which is more expensive.

Effectively, poor families in South Africa are not able to afford a healthy and balanced diet, which has serious implications especially for the optimal development of babies (including those as yet unborn) and children, and the health of vulnerable persons such as old people and pregnant women.

This clearly requires urgent attention from the ANC government who has so far failed to deal with the drought and the effect it has on South Africans.

In order to mitigate the impact on rising food prices on the poor and vulnerable, government should take a number steps: 

1. Declare this drought a national disaster. Zimbabwe and Lesotho have already declared national disasters earlier in the year, and recently SADC declared it a regional disaster. Yesterday, Malawi joined the ranks by proclaiming it a national disaster. 

 2. The drought crisis must be dealt with in a focused and centralized manner. A proper impact assessment needs to be done, the necessary funds should be made available, and relief – including the distribution of food parcels - should be rolled out through a centralised and targeted drought management plan. 

3. Provision must be made for food subsidies, discount coupons and food parcels for the most vulnerable. These must especially include staple food products such as bread and maize meal. Public-Private partnerships (of the non-state-capture kind) between the state and large retailers and producers will be crucial in this regard.

 4. Announcing a significant increase in social grants during the mid-term budget adjustments. This is vital to mitigate the effects of rising food inflation on the poor.

5. An urgent revision of the school feeding scheme to extend it to more schools, in order to ensure that more children receive at least once nutritious and filling meal a day. 

6. The government should assist in keeping small business traders in agriculture/food supplies liquid by creating customer-friendly and easily accessible rent-free spaces to trade. By reducing their overheads it will allow these traders to keep their prices low without sacrificing their profit margins.

 7. A government task team, under leadership of the Department of Monitoring and Evaluation, must be tasked to release a report on food security in South Africa. All responsible departments must urgently convene to propose an implementation plan to make sure that a humanitarian crisis is averted.

 The DA cares about all South Africans and believes in free and fair society with opportunities for all. The effects of the drought are only in there early stages and are set to worse. In order to protect the poor and vulnerable government must take action as a matter of urgency.

Issued by Annette Steyn, DA Shadow Minister of Agriculture, Forestry & Fisheries, 14 April 2016