Debate on the Motion Moved by the Congress Of The People
By Dr LPHM Mtshali MPL
Shadow KZN MEC For Economic Development and Tourism


 Kwazulu-Natal Legislature Pietermaritzburg: Thursday, 27 October 2011 


Honourable Speaker


The trouble with the call made by the Congress of the People for the future characterisation of South Africa as a welfare state is that South Africa already is a welfare state, albeit one without a sufficiently strong  economic base to support or justify such an ambitious description.


Honourable Gabela will be aware that the number of social grant beneficiaries in our country has increased by more than 300 percent in the last nine years. South Africa has effectively become a welfare state, with the number of social grant beneficiaries on a constant rise. Without adequate economic opportunities for the recipients of these grants, the social grants alone risk creating a dependency syndrome among the poorest of the poor.


In the 2009/2010 financial year our country had nearly 14 million social grant beneficiaries. The child-support grant made up the highest share with over nine million beneficiaries. The old-age grant was second highest, with over two million beneficiaries. The 2010/2011 allowance for social grants represented a 12 percent increase year-on-year.


Currently, more than thirty percent of the country's population of 49.9 million are receiving social grants. The National Treasury has predicted that by 2012 there would be 16 million beneficiaries of social grants. This is due to the inclusion of 18-year-olds, up from the previous age limit of 15, for eligibility for the child support grant.


In the current financial year, social grant expenditure is estimated at over R100-billion, a figure large enough to prompt some commentators, such as economist Mike Schüssler, to label South Africa as the "biggest welfare state" in the world.


This perception reflects the government’s tendency to constantly expand the social safety net which includes state pensions, disability allowances, child support, foster care, care dependency, and war veterans’ grants in the country. We also need to note that applicants can at present qualify for more than one grant at a time.


We, of course, understand and appreciate why this is being done. It is impossible for the government to close its eyes before poverty and ignore people when they are suffering and do not have anything to eat or anywhere to stay. But it is equally important to understand that social grants – with the exception of state pensions and disability grants – are a mere stop gap solution to the underlying problems of unemployment and poverty. 


By the ruling party’s own admission – and I quote former national Minister of Social Development, Honourable Edna Molewa here - the government grant system was never intended to be permanent, particularly in the area of young mothers.


Rather than expand the social security net indefinitely until it becomes unsustainable, the priority for government should be to develop marketable skills and establish workable programmes for empowering people who are on the social grant system, particularly the unemployed youth and young mothers, to become self-sufficient and economically independent of the state.


We need to remember that we need to grow the number of people who are able to actively participate in the economy, develop our country, fend for themselves and pay taxes so we can help those who genuinely cannot help themselves.


Rather than accept Honourable Gabela’s motion at face value, we need to vigorously debate its merits in this House and beyond when we communicate public policy to our constituents. And for this opportunity to debate a pertinent socio-economic issue of the day in this House today we in the Official Opposition are most grateful.


While we appreciate the need for an adequate social security net for those who rely on it, we also need to listen carefully to those experts who are critical of the current social grant system. South Africa's dependency ratio  .... ee beneficiaries of social grants to one taxpayer is unsustainable.


Welfare dependency culture is a thorny problem in that it obstructs a healthy self-empowerment culture. Welfare-dependent individuals tend to sacrifice their futures for what they see as ‘free’ social grants. Welfare may subject people to perpetual dependency for generations. It can easily turn into servitude.


Unearned grants obstruct development of the individual’s qualities, attitudes and efforts that support advancement and divert attention from development. In this regard, welfare pauperises its recipients. This culture has sapped communist, socialist and capitalist countries alike. Welfare dependency undermines the status and prestige of self-help and self- reliance and turns viable states into dysfunctional ones.


This public perception has some basis in reality when people observe that their government is giving some well-connected people a free ride. Work, including state employment, has to be depoliticised before a country can build an honest, equal culture geared towards personal achievement.


The IFP’s response to Honourable Gabela’s motion is therefore as follows: Rather than focus on building a welfare state for the sake of having one, we need to be encouraging people to think about what they can do for themselves and others, not to wait for government to do everything for them.


At the same time, we need to be approaching social welfare from a sustainable perspective, opting to build skills and protect basic health, as opposed to merely resorting to free handouts.


I thank you.


Contact: Dr Lionel Mtshali, 082 556 0224