SRD grant increase is “simply unaffordable” says Treasury
- Treasury, Sassa and the Department of Social Development are appealing a high court ruling that found several SRD grant regulations unconstitutional.
- These include the grant’s R370-a-month value, the income threshold and the online-only application system.
- Treasury says increasing the grant or expanding eligibility would be unaffordable, with cost estimates ranging from R70.6-billion to R139-billion a year.
- The SRD grant, introduced during the covid pandemic, has been extended to 31 March 2027. But the government insists it was never intended as a long-term poverty-alleviation grant.
The Department of Social Development, South African Social Security Agency (SASSA) and National Treasury want a ruling that declared several regulations governing the R370-a-month Social Relief of Distress (SRD) grant unconstitutional overturned. Archive photo: Ashraf Hendricks
The Department of Social Development (DSD), South African Social Security Agency (Sassa) and National Treasury have appealed a high court ruling that declared several regulations governing the R370-a-month Social Relief of Distress (SRD) grant unconstitutional.
In January last year, the high court in Pretoria ruled that several SRD regulations unlawfully limited access to the grant, including the online-only application system, the R624 monthly income threshold and the grant’s value. Judge Leonard Twala ordered the government to progressively increase both the grant amount and the income threshold to keep pace with inflation and the cost of living, and that gifts and once-off payments be excluded when assessing applicants’ income.
The SRD grant was introduced in 2020 as a temporary emergency measure in response to the covid pandemic and has since been extended annually. The current extension runs until 31 March 2027. Its value was increased from R350 to R370 in April 2024. To qualify, applicants must earn less than R625-a-month, with Sassa conducting monthly bank checks to verify eligibility. This process has often excluded people receiving money occasionally in their bank accounts as help from friends or relatives.
In October 2024, the Institute for Economic Justice (IEJ) and the #PayTheGrants campaign challenged the regulations, arguing they excluded millions of potentially eligible people. They challenged the online-only application system, the definitions of income and financial support, and the income threshold. They asked the court to declare that Sassa’s failure to pay successful applicants timeously, or at all, was unconstitutional and unlawful.
Judge Twala ruled in their favour, prompting the DSD, Sassa and Treasury to seek leave to appeal.
An increase is unaffordable
In its papers appealing the ruling, Treasury argues that Judge Twala treated the SRD as a general poverty-alleviation grant and assumed the state should have budgeted for around 18-million eligible applicants, rather than the current 8 to 10-million recipients of the grant.
According to Treasury, even extending the grant at its current value to 16.8-million people would cost R70.6-billion a year. Expanding it to 18-million people and increasing the value to account for inflation would raise the total cost to R93.5-billion. In March 2025, the total cost was R35.2-billion.
It said these figures must be considered in light of broader fiscal pressures, including cuts of up to R207-billion planned between 2024/25 and 2026/27. “Further increases to the SRD grant are simply unaffordable,” Treasury said.
Central to the appeal is the interpretation of “income” and “financial support”. The government argues that the SRD grant is assessed monthly and is meant to respond to immediate needs. “If a person receives a R1,000 gift one month, and nothing the next, he or she would not qualify in the first month, but would qualify in the second,” Treasury said. This, it argues, is consistent with short-term relief rather than long-term support like the other grants.
Treasury endorsed including loans and ad hoc assistance in the assessment of income, warning that excluding such funds would allow people who had sufficient means in a particular month to still qualify. It said its position has always been that “income” and “financial support” mean “any money which the applicant can use in a given month to survive”.
“Temporary provision”
Lawyers for the department and Sassa argue that the high court misunderstood the purpose of the SRD grant. They said the court’s finding that the SRD grant is a permanent feature and of equal status as the other social grants resulted in “the erroneous declarations” that the SRD grant’s regulations are unconstitutional and invalid.
They said the SRD is temporary by design. “When a new financial year kicks in, the Covid-19 SRD is deliberated on and a decision by Parliament is taken on whether to vote it in or not,” they said.
“Once it is voted in, it is voted in as a new provision… It is not an extension of the previous year, irrespective of the same name being used.”
The DSD and Sassa argue the grant was always meant to benefit people who are employable but whose income was temporarily disrupted by the covid pandemic, and not as a permanent poverty-alleviation mechanism.
On the issue of online-only applications, the department rejected allegations that digital access posed a barrier for beneficiaries. It argues that the IEJ and #PayTheGrants relied on complaints by SRD applicants on X (Twitter), which is a digital platform. “This is confirmation that the targeted Covid-19 SRD applicants have access to the digital platform and are able to apply for the Covid-19 SRD digitally, thus there is no alleged barrier in accessing the online platform,” the department said.
The government also criticised the court’s suggestion that in-person applications be made available to beneficiaries. The DSD and Sassa warned that setting up physical offices would be costly and slow, requiring tenders, new infrastructure and additional staff. Since the grant is “a temporary provision”, they said there would be no “reasonable justification” to use limited resources on this.
DSD and Sassa also defended the online verification system, saying it was the most reliable way to manage millions of applications.
If the appeal fails, Treasury warned that the immediate effect of Twala’s order would be severe. Bank and database checks would fall away, applications would have to be accepted in person, and the risk of fraud would be high. This, they argue, would not be “just and equitable” as required by the Constitution.
If any SRD grant regulations are declared unlawful, they want the declarations of invalidity suspended for at least 12 months to allow government time to respond.
This article was originally published on GroundUp.
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