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Riots spur SA to consider paying stipends to poor

To address the high levels of poverty and inequality that fueled the unrest.
Image: Bloomberg

A week of deadly protests in South Africa has given impetus to proposals that the government pay out cash stipends to address the high levels of poverty and inequality that fueled the unrest.

“The basic income grant is being given serious consideration,” President Cyril Ramaphosa said in an online lecture on Sunday. “It is being discussed in the governing party and at government level.”

Discussions about the aid are taking place as the Treasury and the presidency consider a separate support package for businesses and individuals affected by the turmoil, in which at least 212 people died. The violence left key infrastructure damaged or destroyed and may slow the nation’s recovery from a 2020 economic downturn.

South Africa has one of the world’s most unequal societies. The top fifth of the population receive more than 68% of income, compared with 47% for an index of emerging markets, data published by the International Monetary Fund in 2020 showed.

South African civil rights organisations and the country’s largest labour group, the Congress of South African Trade Unions, last week called for the urgent introduction of income grants to bring relief to millions who are jobless or been adversely affected by the coronavirus pandemic fallout. The nation’s unemployment rate stands a record 32.6%.

Ramaphosa acknowledged the need for change in his weekly newsletter on Monday.

“We need to fundamentally transform our economy and our society, deepening our efforts to create employment, lift millions out of poverty and ensure that the country’s wealth is shared among all its people,” he said.

A document circulated by the ruling African National Congress last year suggested that paying grants to all South Africans aged 19 to 59 who aren’t normally eligible for other aid would cost the state R197.8 billion ($13.7 billion) a year. As much as 60% of that amount could be recouped by levying extra taxes on those with jobs, it said.

© 2021 Bloomberg

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Failed state.

As useless at creating jobs as deploying the defense force.

Let them work for it. Wipe your own backside!!!!

There is NO reason to loot. NOTHING!!! Only people with no dignity and self-respect loot.

Or the ANC.They loot all the time. Have been for 26 years. Plus ANC caused this alleged inequality by stealing all the tax-money meant for the poor. The ANC fool Gordhan gave it to SAA and eskom and Transnet to be looted by the overpaid cadres like Molefe and Dudu.. Many many billions.Again and again. What rubbish.

Mmmm, and let’s just have an Annual riot/ loot at increase time as well!!!

Exactly right, FAILED STATE!

Is this a joke…???

to these peoples everything is a joke….no sense of responsibility!

All economic problems created by Mr. Zuma

Redistribution of taxes is not the answer. 6% of the population cannot continue paying >90% of the income tax and expect anything to get better. Government needs to stay out of the way and allow the private sector to create wealth and improve the economic prospects of all south africans. The government could start by removing all of these inane “lockdown” measures. The destruction of wealth and people’s livelihoods over the last 1.5 years due to the lockdowns is entirely the government’s fault. That, combined with the government’s corruption and misuse of existing taxes, is the reason for the current environment.

Just in time for the local elections

Instead of saying it like it is, that the ANC has destroyed the economic prospects of its people, by giving gutter education and by looting away the cream of our resources.

Looking at the current situation in SA a Basic Income Grant could actually work.
Lets assume an amount of R1500 is paid to every South African over the age of 21yrs

BUT along with the following needing to happen to fund it:

Minimum wage is abolished
BEE legislation is abolished
Labour Laws are totally rewritten to allow hiring and firing at will (because one will have the safety net of the BIG in place)
Child grant is abolished (this will put a stop to young girls just having children to generate an income as the young will have an income from age 21))
No zero rating of VAT on ANY goods
Stop all payments to tribal leaders/kings and distribute the Tribal land into individual title deeds in KZN and Eastern Cape so that individuals can use it as security to raise finance and start becoming economically active.
Stop cadre deployment at the SOE’s (turn these entities from a cost centre to a profit centre)

The monthly BIG is likely to be spent by all which means that very roughly around a third of it should come back to the fiscus in the form of VAT (if the zero rating of all goods is implemented) and taxes on company profits. The economic boost from implementing the other suggestions coupled with the savings mentioned above should fund it.
Absolute Poverty is greatly alleviated.
The gap in income distribution is to a degree addressed
Economic activity is enhanced
Land is distributed and real ownership acquired.

I know this is wishful thinking and the numbers are a total thumb-suck, but just maybe we as a country need to turn things upside down and think totally out of the box because the direction we are going in is the road to disaster.
A BIG as mentioned in the paper circulated in the article above and funded by taxing working people more is definitely a continuation of poor policy and likely to keep us on the road to disaster.

“and ensure that the country’s wealth is shared among all its people” what “wealth”? Please stop creating this narrative that there’s lots of money floating around that could sustain the levels of unemployment we have currently. The reality is that we’re broke as a country.

So now we’re going to pay them not to loot.

You can’t make this up.

Don’t pay them feed them.

How the …. do you expect this to be able to work with money?

Just feed them!!!!!!!!!!!!!!

I’m against that too. Government is wholly inefficient and corrupt. Using tax-payer money to feed people is backwards. Reduce taxes, get government out of the business of stealing, then there will be more money to go around. People are inherently charitable and private charities are much more efficient than government.

So, the overburdened taxpayer now has to sponsor illegal riotous behaviors!

In other words, the government is to reward such savagery.

This is aimed at the destruction of the middle class (a worldwide phenomenon) as the head of the World Economic Forum stated: “You will own nothing, but you will be happy”

We will just have more riotous behaviour as the ‘stipend’ for being professional looters will not be enough!

About time law and order becomes a priority over empty promises and lies, but then again, would those in power want to upset the 70-odd per cent who were promised Utopia for a vote and got nothing whilst those elected live the extremely high life?

Hmm, forcing the high income earners to leave is really not a clever way to close the gap between (relatively) rich and poor. Too few earners, too many destitute. Good luck.

One can not pay people to procreate and expect it to end well.

This has been tried and tested but the current ignoramusses are too stupid to learn from history.

Nicolae Ceausescu tried something similar and he was captured and killed by protestors, that would not have been born, hadn’t he made the Decree 770.

Not only do they want to use tax money to pay people to procreate, now additional tax has to be used to feed them.

Progressives imagine that they can ignore the laws of economics. But they cannot ignore the consequences of ignoring the laws of economics. They imagine that their policies, that pay people not to work, do not result in fewer people working. They are shocked, shocked, at the very suggestion. When the government pays people not to work, that means fewer people producing fewer goods. And that means a poorer society. More government spending won’t change this fact.

End of comments.

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