SRD grant a “material risk” to government, declares Treasury

On Wednesday, Finance Minister Enoch Godongwana announced that the Social Relief of Distress (SRD) grant would be extended for another 5 months.

While this plan was partially celebrated, it also gives the government time to work on a long-term solution.

This plan may include efforts to prevent the grant from bankrupting National Treasury.

Does the government have money for the SRD grant?

The Social Relief of Distress (SRD) grant was one of three risks the government highlighted in its Medium Term Budget Policy Statement (MTBPS).

In the section highlighting fiscal risks, National Treasury explained that the “legal challenges” surrounding the grant meant it was a risk to the country’s expenditure.

The section references the January 2025 High Court ruling declaring parts of the grant, including the means test threshold, invalid.

Now, Treasury awaits a decision by the Supreme Court of Appeal, which heard the case in August 2026.

If the SCA upholds the High Court ruling, Treasury suggests “beneficiary numbers and the total cost of the grant could increase substantially.”

Treasury suggests that this would double spending on the grant.

The decision would increase the grant’s annual funding requirement from R36 billion to R74 billion.

However, Treasury estimates it would only add 3 million beneficiaries to the current 13 million eligible for the SRD grant.

Tight-fisted Treasury Running Out of Room

In January 2025, the state argued that because the grant was temporary, it didn’t need to meet the provisions of the Social Assistance Act.

The High Court disagreed.

In that case, the state admitted it only budgeted for 10.5 million beneficiaries to receive the grant.

According to the South African Social Security Agency (SASSA) June 2026 report, 7.9 million people receive the grant.

At the time of the report, only 89% had been paid out.

This suggests the government is actively pursuing its 10.5 million cap, despite 18 million applicants.

By extending the SRD grant in its current form until 31 March 2027, Treasury also has the opportunity to reshape the grant based on the SCA ruling.

In the 2026 National Budget, Treasury budgeted R36.9 billion for the SRD grant.

But the budget also reveals that Treasury only allocated R1.72 billion for the grant in 2027.

The MTBPS confirms this.

In changes to the budget’s non-interest expenditure, Treasury reduces spending on the SRD grant by R6.7 billion over the next 2 years.