Poverty and well-being in post-apartheid South Africa: an overview of data, outcomes and policy

How have the South African poor fared since the end of apartheid?

By: Bhorat H, Kanbur R
Published by: Development Policy Research Unit (DPRU), University of Cape Town (UCT), South Africa , 2005
Via: Eldis

The introduction of democracy and de-racialised politics in the early 1990s in South Africa presented huge challenges for a nation with an extensive history of inequality, poverty, deprivation and discrimination. Have the hopes of the post-apartheid era been realised? This paper presents an overview of poverty and well-being in the first decade of post-apartheid South Africa. The authors argue that five clear trends have emerged in the analysis of welfare shifts in the post-apartheid period:

• an increase in both absolute and relative income poverty, when using the standard measures of poverty
• an increase in income inequality, which is notably being catalysed by a rise in the share of within-group inequality
• despite some employment growth, the rapid expansion of the labour force has resulted in increased unemployment rates irrespective of the definition used
• a large and swift fiscal resource shift has engendered widened access to assets and basic services to poor households
• these changes in poverty and well-being in the post-1994 period have occurred within, and have influenced and had been influenced by, an environment of tepid economic growth rates.

The authors conclude that, while ensuring that a conducive environment to realise higher growth is critical, this should not marginalise the issues of income vulnerability. In this context, it is the nature of growth, together with growth itself, that is crucial, and the results on the dissipating impact of inequality on economic growth is a key result. Given South Africa's severe income vulnerability, the growth-poverty-inequality nexus retains a particular relevance for the future.