WP15/2010

Efficiency and equity effects of social grants in South Africa

Stellenbosch Working Paper Series No. WP15/2010

Author(s): Servaas van der Berg, Krige Siebrits, Bongisa Lekezwa

JEL Classification: H31, H53, I38

Keywords: Social security, social grants, social pensions, child support grants, effects of social assistance, South Africa

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Abstract:

This paper discusses the nature and effects of social grants programmes in South Africa against the backdrop of international trends in the reform of social assistance systems. It shows that South Africa has a well-developed social assistance system that significantly reduces extreme poverty, in part because the grants are very well targeted. The review of existing literature and new evidence presented in this paper suggest that the grants influence the behaviour of recipients and potential recipients in various ways, not all of which are necessarily benign. The paper also highlights the scope for further research on the potential of workfare programmes, conditional cash transfer programmes and other innovative social assistance schemes in the South African context.