South Africa’s social grant recipients are set to receive a much-needed financial boost in 2025, as Treasury has proposed significant increases aimed at keeping pace with inflation.
The proposed adjustments come in response to rising living costs and economic pressures, ensuring that millions of vulnerable individuals and families receive adequate support.
Finance Minister Enoch Godongwana’s Budget Speech, originally scheduled for February but postponed to March 12, includes an additional R23.3 billion allocation for social grants.
This increase was intended to counteract the now-rejected proposal for a 2% VAT hike, which would have disproportionately impacted low-income households.
Increases
The proposed grant increases for 2025 are designed to provide financial relief to over 25 million South Africans who rely on these payments.
The old age grant will increase by R150, with R140 applied in April and the remaining R10 in October, bringing the total to R2,340 per month.
The child support grant, which benefits nearly 13 million children, will rise by R50 to R580 per month. Additionally, the foster care grant will see an R80 increase, bringing it to R1,260 per month.
Godongwana had planned to announce these increases with the following statement:
“Spending on social grants is allocated an additional R23.3 billion. This is to ensure that low-income households are not left worse-off by the increase to the VAT rate.”
Below is a breakdown of the proposed grant increases:
| Grant Type | Old Amount (R) | Increase (R) | New Amount (R) |
|---|---|---|---|
| Old Age Grant | 2,185 | 150 | 2,335 |
| War Veterans Grant | 2,205 | 150 | 2,355 |
| Disability Grant | 2,185 | 150 | 2,335 |
| Foster Care Grant | 1,180 | 80 | 1,260 |
| Care Dependency Grant | 2,185 | 150 | 2,335 |
| Child Support Grant | 530 | 50 | 580 |
| Grant-in-Aid | 530 | 50 | 580 |
SRD Extension
In addition to these permanent increases, the COVID-19 Social Relief of Distress (SRD) grant has been extended until March 2026.
This grant, which supports over 8 million beneficiaries, will cost the government approximately R35 billion.
President Cyril Ramaphosa has emphasized that the SRD grant is a stepping stone toward a long-term basic income support system for unemployed individuals.
Arthur Kamp, chief economist at Sanlam Investments, has raised concerns about the long-term sustainability of the SRD grant.
He noted that expanding the grant could result in increased annual spending of over R30 billion, creating financial risks for the country’s fiscal policy. However, in the short term, Treasury believes these adjustments are necessary to support the most vulnerable citizens.
The proposed grant increases highlight the government’s commitment to social welfare, but they also raise questions about long-term financial sustainability.
While millions of South Africans will benefit from these higher payments, the challenge remains in balancing social support with economic stability.
As the country moves forward, discussions around funding, tax policy, and social welfare reforms will continue to shape South Africa’s financial future.
