In South Africa, the number of people relying on welfare is dangerously high. There's actually more people in South Africa that receive government aid than have jobs. Which makes you start to wonder where all the money is coming from and how long it will last.
In a new budget set to be released tomorrow, the household tax burden is likely to rise even more than it has in the past. From 2007 to 2012, the household tax burden increased 3 percent, rising from 12 to 15 percent.
South Africa's welfare dependence has been on the rise ever since 1994 when the country had its first democratic election. Since that time, the unemployment rate has doubled.
Total government spending on social programs excluding education is estimated to be 22 percent. Compare that to South Korea at 9.3 percent, and Mexico at 7.4.
A total of 16.5 million people in South Africa are currently receiving government aid. Only 15.2 million are working and have jobs. The total percentage of the population receiving aid is 30.
While they spend less than more developed countries, that is still a huge amount considering how undeveloped South Africa is.
While some people are just fine with the fact that they receive aid and don't have to work, most unemployed people in South Africa couldn't find a decent job even if they wanted to. In many parts of the country jobs are hard to come by and most are in factories or farms. Most of these low-skilled jobs only pay workers minimum wage. And with the coming tax increase, more and more people will likely turn to welfare.
In some towns where jobs are extremely scarce, if welfare were to be eliminated the entire towns would likely just dissolve.
President of South Africa, Jacob Zuma thinks that they can continue this system of welfare even though it is continually growing.
"When we deal with the issue of social grants, it's not because we are saying this country is going to live on these. We are dealing with a problem that there is no other way you can deal with it, to help those who have absolutely nothing to have something to eat on the table." said Zuma on February 20 in parliament.
Is there another way to deal with this situation? How can more jobs be created in South Africa? Leave a comment and let us know what you think.
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