SA plans R36bn relief measures over Covid-19, riots

Finance minister Tito Mboweni. File photo.
Finance minister Tito Mboweni. File photo.
Image: Esa Alexander/Sunday Times

South Africa plans about R36bn ($2.4bn) of relief measures to support businesses and individuals affected by recent unrest and Covid-19 restrictions, the finance ministry said on Wednesday.

The interventions would be funded by better government revenues and by shifting around some spending, senior officials told a news conference, expanding on measures announced by President Cyril Ramaphosa on Sunday.

Ramaphosa tightened lockdown restrictions at the end of June as coronavirus cases spiked, but he eased them on Sunday as the peak of a "third wave" appeared to have passed. His government's economic recovery drive was dealt a major blow by arson and looting triggered by the jailing of former president Jacob Zuma this month.

"We are funding this package within available resources currently. We are not going to be going for borrowing," National Treasury director-general Dondo Mogajane said.

Edgar Sishi, acting head of the budget office, said increased revenue linked to higher commodity prices meant R36bn of new spending could be accommodated "so long at those measures are temporary".

The largest component of the relief package is the reinstatement of a R350-a-month social relief grant until the end of March 2022, which will cost around R27bn. State insurer Sasria will get R4bn to help pay out claims related to the unrest and support via the Unemployment Insurance Fund will amount to roughly R5bn.

REASSURING INVESTORS

Finance minister Tito Mboweni said his ministry would allocate more money to the police and military, and that Sasria would start paying out claims immediately.

Mogajane said he had spoken to investors to reassure them that the country's economic fundamentals were intact and reforms were happening.

Zuma turned himself in to police late on July 7 to begin 15 months in jail for contempt of court, after defying an instruction to give evidence at an inquiry into corruption during his nine years in power until 2018.

Sporadic protests erupted in his home province after his imprisonment, before quickly escalating into an explosion of violence and destruction fuelled by the poverty and inequality that persist almost three decades after the end of apartheid.

Zuma denies there was widespread corruption under his leadership and has asked the country's highest court to rescind his jail sentence.


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