The areas in South Africa where people rely more on grants than salaries

Statistics South Africa has published its General Household Survey for 2020, providing a broad overview of the state of the country and its people. One of the key findings of the survey is the heavy reliance on grants by much of the population, with more than a quarter of respondents now relying on grants as their main source of income.

This number increased significantly in 2020, primarily due to the Covid-19 pandemic, rising from 20.4% of the population in 2019, to 28.8% in 2020.

By comparison, Half (50.8%) of people said they rely on a salary or wage as their main source of income, while 8.8% rely on remittances sent by friends or family members.

This shifting reliance on grants is most evident in the Eastern Cape, Limpopo and the Free State, while those in Gauteng and the Western Cape are typically more reliant on jobs.

Statistics South Africa said that a quarter (25.2%) of all individuals, and 40.5% of all households in metropolitan areas receiving some kind of social grant in 2020.

Individual grant receipts was highest in Buffalo City (32.8%), Mangaung (29%), Nelson Mandela Bay and eThekwini (26.7% each), and least common in Johannesburg (24%) and Tshwane (23.8%).

A similar pattern is evident for households at the metropolitan level, and the data shows that the receipt of one or more social grants was most common for households in Buffalo City (54.2%), Nelson Mandela Bay (48%) and Mangaung (42.5%) and least common in Tshwane (34.3%) and the City of Johannesburg (39.1%).

Unsustainable

The National Treasury has previously warned that the current system could become unsustainable.

In a presentation to parliament on 19 November, Treasury noted that 46% of the entire population currently receives social grants, representing an unusually high coverage for a developing country. If job creation continues to be poor, the sustainability of the system and the overall fiscal position will become a serious concern, it said.

“There are already 27.8 million people in the system receiving grants, 9.4 million receiving the Social Relief of Distress grant. Increasing grants beyond current levels would require tough decisions at the political level on how priorities should be readjusted in government.”

“The population is projected to increase from 60 million in 2021 to 71 million by 2040, resulting in a higher number of children and old people depending on child social grants, old age pension grants, basic education and health. The increased spending required from the government will place pressure on fiscal sustainability.”

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