A New Fund for “Back to School” Initiatives Has Been Suggested for South Africa
- by Mamparra
The Pietermaritzburg Movement for Economic Justice and Dignity suggests that the government of South Africa institute a unique ‘back to school’ fund across the country to provide financial assistance to family members so that they can better help their children in gearing up for the start of the fresh academic year.
The statement made by the organization read, “We endorse that the government offers some form of supplemental funding distribution each January to aid parents with their children’s current school year costs, thus further retaining a stronger foundation to invest in education, whilst decreasing the debt racked up at the start of the year, which torments parents during the entire year.”
“This unique Back-to-School fund, which is aimed at the new school year, would offer a concentrated investment for enhanced academic performance while also relieving some of the economic burdens that are placed on parents,”
The National Minimum Wage and other social grants are not sufficient to assist the bulk of the population, according to the PMBEJD, which contends that the methods, such as those already in place, are not adequate to address the rising living expenses in South Africa. This is the context in which the proposition is being made.
The government, acting through the Department of Labour and Employment, is suggesting boosting the NMW by 8% in 2023, which would bring the hourly wage up to R25. Nevertheless, according to the PMBEJD, this is simply insufficient. “The National Minimum Wage is a basic wage – it decreases productivity in the work environment, it slows down the economy’s growth, it harms workers’ wellbeing, it puts laborers’ children’s futures at risk, it causes workers to vulnerable, and it puts laborers in debt,” it said.
The National Minimum Wage is considered to be too low; it is insufficient to cover the 3 main workforce costs of food, transportation, and electricity. The argument says that prior modifications to the NMW didn’t necessarily include inflation for the coming year, but rather concentrated on what inflation had been for the previous term (inflation records backward), and then simply added on a few additional percentage points just above overall inflation at a specific period.
This implies that wage rates are constantly trying to catch up: the wages from the preceding year are diminished by the rising prices of that particular year, and so using previous inflation information again places the laborers back exactly where they started in 2022, without safeguarding wages against inflation expectations or enhancing laborers’ wage rates for the forthcoming year.
The consensus reached by the government was that anticipated inflation for the term 2023, at least for the three key workforce expenditures of food, transportation, and electricity, must be factored into the yearly modifications to the minimum wage.
“Furthermore, the purpose behind the pay rises ought to be made crystal clear. As a result, a component of equality to right the wrongs caused by the apartheid inheritance of poor wages must be taken into consideration. One of the initial mandates of the NMW was to gradually enhance the benchmark income of low-paid laborers.
If it is implemented correctly, the NMW has the potential to be a useful tool that can enhance not just our economic cohesion, educational opportunities, and medical results, but also our economic future. It is essential to hold discussions every year regarding the level of the NMW, according to the PMBEJD.
Supplemental Government Grants
To assist South Africans in meeting their day-to-day needs in the face of high rates of inflation, the central government is under pressure to either implement new funding or broaden and raise those that are already in place.
As of right now, the R350 Social Relief Distress grants have been prolonged to March 2024 to provide a modest amount of support to the millions of South Africans who are currently having trouble finding employment as a result of the pandemic and lockdown that occurred in 2020/21 due to the Covid-19 virus. On the other hand, the ANC has the goal of making this grant an integral component of the nation’s ongoing social initiatives and making it a component of a widespread grant for basic wages.
The Department of Social Development’s studies has shown that this could be a feasible option to reduce poverty throughout the country; however, for it to be successful, it would require funding from the nation’s taxpaying citizens. In December, President Cyril Ramaphosa stated that the National Treasury is also reportedly modeling a unique fund to aid job applicants in the country.
Even so, because the Treasury only has a finite amount of funds at its disposal, it would be forced to make challenging choices regarding which extra social relief programs should be the easiest to put into effect, who should be the focus of those programs, and where the funding for these kinds of proposals would come from.
More Than 18 Million People in South Africa Are Recipients of Grant Money
Throughout his presentation of the Medium Term Budget Policy Statement in October, the Minister of Finance, Enoch Godongwana, announced that the SRD fund would be extended until March 2024. According to the minister, other subsidies, like those for the elderly and people with disabilities, will see increases that are less than the rate of inflation as a direct consequence of the extension of the SRD grants.
The Pietermaritzburg Movement for Economic Justice and Dignity suggests that the government of South Africa institute a unique ‘back to school’ fund across the country to provide financial assistance to family members so that they can better help their children in gearing up for the start of the fresh academic year. The statement made by the…
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