No money for Julius Malema’s dream

Efficient Group chief economist Dawie Roodt said that the state does not have the money to increase social grants to R4,400, as EFF leader Julius Malema proposed.

He shared his comments on the Truth Report podcast following Malema’s comments at the EFF’s Mpumalanga Provincial Manifesto Rally on Saturday, 5 September 2026.

He argued that the ANC cannot take away people’s SASSA support grants because these payments are funded by the taxpayers.

Malema added that financial aid, such as the R350 grant, is a right rather than a political gift from the ANC.

He added that the EFF will double social grants when it takes power. “We want it to start grants from R4,500,” Malema said.

The EFF leader also called on the government to guarantee employment or allowances for young people graduating from schools and universities.

“You are the powerhouse of the economy of South Africa. A child must go to school and come back, but they are not working,” he said.

“From the classroom, you must go to work. The government must either give you jobs or give you an allowance.”

Roodt said that Malema’s proposal is unrealistic, as the state does not have sufficient funds to support it.

“There are 26.5 million grant recipients in South Africa. The majority are children receiving a grant of R580 per month,” he said.

“Then there are roughly 8 million grant recipients receiving about R600 per month, alongside elderly people receiving approximately R2,400 per month.”

He said that if South Africa increases grants to R4,400, it will break the bank. “The fiscal account cannot support this, and the tax base in South Africa is far too small,” he said.

“This is just cheap politics by Julius Malema, and a grant increase to R4,400 will not happen,” Roodt added.

“It is impossible for the tax base to carry that kind of support, especially given the weak state of the South African economy.”

South Africa has 8.3 million taxpayers who must support 26.5 million grant recipients

South Africa is in an unsustainable financial situation with a narrow tax base of 8.3 million income taxpayers supporting a social safety net for 26.5 million people.

This was revealed in the National Treasury’s 2026 Budget Review and in a Parliamentary question-and-answer session.

The 2026 Budget showed that, in the current financial year, South Africa has 8.338 million individuals and taxable income.

These are people who earn over R99,000 per year and who pay personal income tax. Simply put, they are the cornerstone of the country’s tax base.

What is concerning is that around 1 million income taxpayers account for 62% of all personal income tax.

On the other side of the spectrum, South Africa has 26.5 million social grant beneficiaries funded through tax revenue.

Spending on social development will increase from R412.2 billion in 2025/26 to R466.4 billion in 2028/29.

This supports poverty reduction by providing social grants, risk benefits through social insurance, and welfare services.

Social grants constitute the largest share. Excluding the social relief of the distress grant, spending will increase from R246.6 billion in 2025/26 to R276.5 billion in 2028/29.

The social relief of distress grant is allocated an additional R36.4 billion to extend payments until 31 March 2027 at the current rate of R370 per beneficiary per month.

To put these numbers in perspective, there were around 2.5 million social grant recipients in South Africa in 1994.

That means that the number of grant recipients increased by 960% to 26.5 million over the last 32 years.