Leading UJ Social Researcher: Social grants solve more problems than they may create

​​​“Social grants solve more problems than they may create”, says Professor Leila Patel, the Director of the Centre for Social Development in Africa (CSDA), a research centre based at the University of Johannesburg (UJ).


Patel was speaking at the annual Helen Joseph Memorial Lecture held by the University on Monday night (14 October, 2013).
During her lecture, Patel revealed findings from a study that the CSDA conducted in June this year. The CSDA study investigated the voting behaviour of grant beneficiaries in Doornkop (Soweto) and Riverlea, both poor urban areas with a high grant uptake, which was conducted partly in response to the current popular discourse regarding the effect of social grants in South Africa.
“Social grants, it is argued, create perverse incentives, such as buying votes, increasing teenage pregnancies, discouraging work seeking and a reluctance to take Anti-Retroviral medication in order to access the disability grants,” explains Patel.


However, says Patel, none of these assertions are true. “Teenage pregnancies started declining in the first half of the 1990s and this trend was already under way when the grant was introduced, and researchers have found that grant beneficiaries who were without work were extremely motivated to get work and… place a high value on paid employment”.
Further, Patel identifies concerns people have about the negative impact social grants have on the economy. “Social grants have increased from 3 million beneficiaries in 1995 to over 16 million today covering almost a third of the population,” she says, “and in the debate on fiscal issues, a trade-off is presented as a choice between grants and jobs”.
But is the current social assistance system sustainable? “Yes,” says Patel, “although the share of taxes going to grants increased from 11% to 13% since 1996, social assistance as a percentage of GDP is at around 3.3%. It seems then that the grants system does not present a significant sustainability problem”.
In fact, explains Patel, the costs to the economy in terms of poverty and inequality would be much higher without the grants. “There is now compelling evidence that the social grants system reduces poverty irrespective of which poverty lines are used”.
Patel points out that the figures do not mean people are no longer poor, but they show that the depth of poverty of poor people in the country has been reduced.
“Although overall inequality increased between 1993 and 2008,” she says, “grants do make a difference in reducing inequality. Without grants, income inequality would be much larger.”
One of the biggest recent issues of contention with regards to grant receipt, argues Patel, concerns “the use of state monies and human resources for electioneering purposes and the electoral power of grant beneficiaries and their role in securing electoral support for the ANC. Since grant beneficiaries make up a significant percentage of voters, many perceive it to be a vote buying mechanism that is used by the ruling party to win support from poor voters.”
The CSDA revealed that in their preliminary findings there is no evidence to support the claim that grant receipt gave the ANC an electoral edge over other parties.
“While some individual beneficiaries might change their behaviour to access a grant that might benefit them financially, this does not describe the average behaviour of beneficiaries. Respondents also did not think that grants were a form of bribery. But, two thirds of all respondents held the view that the handing out of food parcels before an election amounted to vote buying.”
Patel laments the current discourse surrounding grant beneficiaries and their voting patterns, which she says “represents [grant beneficiaries] as people who are easily swayed by politicians for their own ends. Beneficiaries are not credited with rational decision making powers and an ability to make rational choices about their lives. These representations of grant beneficiaries quite unknowingly amount to an attack on beneficiaries and poor people, blaming them for their misfortune”.
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