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Expanding the Social Security Net in South Africa: Opportunities, Challenges and Constraints

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Author Info

  • Kalie Pauw
  • Liberty Mncube

    ()
    (Development Policy Research Unit, University of Cape Town)

Abstract

For a large proportion of the South African population social welfare grants are an important source of income. Rapid increases in government expenditure on social security between 2000 and 2006 has further increased poor households’ reliance on welfare grants and has been important in the fi ght against poverty. Given these apparent successes, many are calling for further expansions in social security provisioning, with the idea of developing conditional cash transfer schemes surfacing in policy circles from time to time. However, as we argue in this paper, various constraints to such expansions of the welfare net exist. Whereas in the past much of the increased expenditure on social security provisioning could be fi nanced out of government revenue overruns, it is likely that further increases will only be possible through a reallocation of government expenditure. Already there is evidence of a substitution taking place within the social budget: expenditure on education and health seems to have declined in favour of increased welfare transfer expenditure. This, we argue, is untenable and may harm the already weak education and health services in South Africa. Conditional grants linked to school attendance and visits to health clinics will only put further pressure on health and education services, as well as the agency responsible for disbursing and monitoring welfare payments in the country. We argue, therefore, that budgetary and service delivery constraints, at the present moment, present a strong argument against any expansion of the social welfare system in the immediate future.

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Bibliographic Info

Paper provided by University of Cape Town, Development Policy Research Unit in its series Working Papers with number 07127.

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Length: 52 pages
Date of creation: Sep 2007
Date of revision:
Publication status: Published in Working Paper Series by the Development Policy Research Unit, September 2007, pages 1-52
Handle: RePEc:ctw:wpaper:07127

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Keywords: social security net; social welfare; welfare grants; South Africa;

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References

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  1. Case, A. & Deaton, A., 1996. "Large Cash Transfers to the Elderly in South Africa," Papers, Princeton, Woodrow Wilson School - Development Studies 176, Princeton, Woodrow Wilson School - Development Studies.
  2. Esther Duflo, 2000. "Grandmothers and Granddaughters: Old Age Pension and Intra-household Allocation in South Africa," NBER Working Papers 8061, National Bureau of Economic Research, Inc.
  3. Rawlings, Laura B., 2004. "A new approach to social assistance : Latin America's experience with conditional cash transfer programs," Social Protection Discussion Papers 30165, The World Bank.
  4. Servaas van der Berg & Ronelle Burger & Rulof Burger & Megan Louw & Derek Yu, 2006. "Trends in Poverty and Inequality since the Political Transition," Working Papers, University of Cape Town, Development Policy Research Unit 06104, University of Cape Town, Development Policy Research Unit.
  5. Thurlow, James, 2002. "Can South Africa afford to become Africa's first welfare state?," FCND briefs 139, International Food Policy Research Institute (IFPRI).
  6. Murray Leibbrandt & Laura Poswell & Pranushka Naidoo & Matthew Welch & Ingrid Woolard, 2005. "Measuring Recent Changes in South African Inequality and Poverty using 1996 and 2001 Census Data," Working Papers, University of Cape Town, Development Policy Research Unit 05094, University of Cape Town, Development Policy Research Unit.
  7. Das, Jishnu & Quy-Toan Do & Ozler, Berk, 2004. "Conditional cash transfers and the equity-efficiency debate," Policy Research Working Paper Series 3280, The World Bank.
  8. Laura B. Rawlings, 2004. "A New Approach to Social Assistance: Latin America’s Experience with Conditional Cash Transfer Programs," World Bank Other Operational Studies 11813, The World Bank.
  9. Fabio Veras Soares & Sergei Suarez Dillon Soares & Marcelo Medeiros & Rafael Guerreiro Osório, 2006. "Cash Transfer Programmes in Brazil: Impacts on Inequality and Poverty," Working Papers 21, International Policy Centre for Inclusive Growth.
  10. Servaas van der Berg, 2002. "Issues in South African Social Security," Working Papers 01/2002, Stellenbosch University, Department of Economics.
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Cited by:
  1. Margaret Grosh & Carlo del Ninno & Emil Tesliuc & Azedine Ouerghi, 2008. "For Protection and Promotion : The Design and Implementation of Effective Safety Nets," World Bank Publications, The World Bank, number 6582.
  2. Haroon Bhorat & Morne Oosthuizen & Carlene van der Westhuizen, 2012. "Estimating a poverty line: An application to free basic municipal services in South Africa," Development Southern Africa, Taylor & Francis Journals, vol. 29(1), pages 77-96, March.
  3. Haroon Bhorat & Carlene Van Der Westhuizen, 2012. "Poverty, Inequality and the Nature of Economic Growth in South Africa," Working Papers, University of Cape Town, Development Policy Research Unit 12151, University of Cape Town, Development Policy Research Unit.
  4. Wiebelt, Manfred & Pauw, Karl & Matovu, John Mary & Twimukye, Evarist & Benson, Todd, 2011. "Managing future oil revenue in Uganda for agricultural development and poverty reduction: A CGE analysis of challenges and options," IFPRI discussion papers 1122, International Food Policy Research Institute (IFPRI).

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