A costing model for the South African social assistance system

Figures & data

Table 1. The core grants.

Grant type		Age band	October 2019 grant amount^a	Description
OAG	Tier 1 (T1)	60–74	R1 780	Grant payable to age-eligible individuals who meet the means test.
	Tier 2 (T2)	75+	R1 800
DG		18–59	R1 780	Means-tested grant payable to disabled individuals in terms of Section 9 of the Social Assistance Act of 2004 (Act No. 13 of 2004)
CDG		0–18*	R1 780	Means-tested grant payable to a primary caregiver of a child who requires and receives permanent care or support services due to mental or physical disability
FCG		0–18**	R1 000	Grant payable to individuals who have foster care of a child by order of the children’s court.
CSG		0–18*	R430	Means-tested grant payable to a primary caregiver of a child who satisfies the criteria in terms of Section 6 of the Social Assistance Act of 2004 (Act No 13 of 2004)

Source: SASSA.

^a Minister Tito Mboweni, 2019 Budget Speech, 20 February 2019. https://www.gov.za/speeches/budget_vote. Accessed 18 November 2019.

*These grants are paid until the end of the calendar year in which the child turns 18.

**This grant is paid until the end of the calendar year in which the child turns 21 while the child is still in high school.

Table 2. The means-test criteria for the core grants.

	Income above which no grant is paid*	Income below which the full grant is paid*	Assets for single person above which no grant is paid	Assets for married couple above which no grant is paid
OAGT1	R82 440	R32 040	R854 400	R1 708 800
OAGT2	R83 400	R32 400	R864 000	R1 728 000
DG	R82 440	R32 040	R854 400	R1 708 800
CDG	R213 600	R213 600	Not applicable	Not applicable
CSG	R51 600	R51 600	Not applicable	Not applicable

* If the grant recipient is married, then the average income across the spouses is used.

Figure 1. Baseline projection.

Table 3. Comparison of model and national treasury projections

		2018/2019	2019/2020	2020/2021	2021/2022
Benefit cost	National Treasury	3.21%	3.24%	3.26%	3.25%
	Model (core grants)	3.16%	3.22%	3.17%	3.18%
	Model (all grants)	3.19%	3.24%	3.20%	3.20%
Expense cost	National Treasury	0.17%	0.15%	0.15%	0.14%
	Model	0.13%	0.12%	0.12%	0.12%

Figure 2. Model backtest.

Figure 3. Sensitivity of cost to benefit increases.

Figure 4. Sensitivity of cost to age-eligibility requirements.

Table A1. Baseline parameters applied across all grants.

Parameter		Assumption
Population model		Thembisa 4.2
OAGT1 start age (DG end age)		60
OAGT2 start age		75
FCG and CSG end age		18
2018/19 operational expenses (Rbn nominal)		R6.462
2018/19 GDP (Rbn nominal)		R5 059.1
Inflation per annum		4.5%
Real GDP growth	Pessimistic	1%
	Downside	1.5%
	Baseline	2%
	Upside	3%
	Optimistic	4%

Table A2. Baseline Coverage and Percentage Paid Parameters

	OAGT1	OAGT2	DG	CDG	FCG	CSG
Coverage	66.32%	66.32%	3.14%	0.78%	2.01%	64.78%
Percentage paid	99.46%	99.46%	102.66%	101.41%	106.19%	100.86%