Social Grants get R292.8bn boost

Finance Minister Enoch Godongwana has allocated R292.8 billion to social grants in the 2026/27 financial year, covering old-age, disability, child support, foster care and grants for war veterans.

“Old-age, disability and care dependency grants will rise by R80 to R2,400 per month,” Godongwana said in his budget speech to parliament, adding that the war veterans’ grant would increase to R2 420. 

Foster care grants will increase to R1 290 in April and R1 300 in October, while the child support and grant-in-aid grants will rise by R20 to R580.

The social wage, which accounts for more than 60% of non-interest spending, will provide services to 13.6 million schoolchildren, healthcare to 84% of the population and social grants to 26.5 million beneficiaries, the minister said.

Basic education, health and social protection together represent 70.3% of the social wage.

Godongwana said the government had identified R12-billion in savings through its targeted and responsible savings initiative, which were reallocated to support social services, the judiciary and security sectors. 

Upgrades to the South African Social Security Agency’s biometric and income verification systems led to the termination of nearly 35 000 incorrect or fraudulent grants, he added.

Social grants remain a critical support in the context of South Africa’s 31.4% unemployment rate, affecting roughly 7.8 million South Africans, including many youth and low-income workers. Godongwana said these grants provide a monthly lifeline for households facing economic hardship, helping cover food, healthcare and school-related expenses.

“The government recognises the essential role social grants play in sustaining families and communities,” he said. “These increases are part of our continued commitment to protecting the most vulnerable.”

Peace and security allocations, including R2.7 billion to the South African National Defence Force, support operations alongside the police in tackling illegal mining, gangsterism and organised crime. “Stability in communities is essential to ensure that social grants reach those who need them most,” Godongwana said.

The budget also proposes measures to ease financial pressure on households, including raising the VAT registration threshold from R1 million to R2.3 million and increasing the capital gains tax exemption for small businesses from R1.8 million to R2.7 million. Personal income tax brackets and rebates will be adjusted fully in line with inflation.

Education and early childhood development remain linked to grant support. The budget allocated R12.8 billion over three years to expand early childhood development grants to 300 000 additional children, while the national school nutrition programme continues to feed over 9.9 million learners, adjusted for food inflation.

Health allocations include R26 billion to HIV/Aids programmes and R21.3 billion to cover shortfalls in doctor compensation and goods and services. Godongwana said these investments, alongside social grants, form part of a comprehensive social protection system, supporting households across multiple dimensions of need.

These increases come as the country continues to face high unemployment, with about 63% of young people aged 15 to 34 unable to find jobs. While the overall unemployment rate is at 31.4%, the expanded definition of unemployment, including discouraged work-seekers, is around 45%.

Municipal funding, including R86.9 billion for free basic services to 11.2 million households, ensures that social grant recipients in urban and rural areas can access water, electricity and sanitation. 

“Social grants are not only financial transfers; they are essential to the well-being and dignity of millions of South Africans,” Godongwana said. 

“They form the backbone of a social safety net that sustains communities in the face of persistent unemployment and economic pressures.”

Despite these increases, the 2026 budget did not increase the Social Relief of Distress (SRD) grant, which continues to provide R370 a month to roughly eight million beneficiaries. 

Labour federation Cosatu welcomed the 9.6% above-inflation increases for existing social grants, including old-age, disability, foster care and child support grants. It however sharply criticised the budget for failing to provide any inflationary adjustment for the SRD recipients, calling this a “shameful failure”.

Parliament should redirect politicians’ salary increases to these destitute grant holders, Cosatu argued, highlighting that the most vulnerable South Africans remain without adequate support in the face of unemployment and widespread economic pressures.