The number of South Africans receiving social grants have almost doubled since 2003, climbing to about 13.2 million people, President Thabo Mbeki said Tuesday.
Delivering the Presidency's Budget Vote in the National Assembly, Mr Mbeki cited the latest figures from March this year, which are almost double the 6.8 million people who were receiving social grants four years ago.
This increase in the social wage has been accompanied by more people entering the labour force as a result of the growing strength of the economy, with more than 500 000 jobs created since September 2004, he said.
By September this year, the South African economy would have seen its longest-ever period of sustained growth.
"Our current rate of growth has remained at a steady high level for longer than ever before in our history," he said in the National Assembly.
"The extent and depth of income poverty has been significantly reduced, especially since 2001."
Since 2004, real incomes per person, on average, have risen at around four percent per year, while investment has risen from 14,7 percent of gross domestic product in the first quarter of 2002, to 19,2 percent of GDP in the last quarter of 2006.
By the last quarter of 2006, investment grew at an annualised rate of 16 percent.
This was "well ahead of our AsgiSA [the Accelerated and Shared Growth Initiative of South Africa] target of 10 percent per year", he said.
Deputy President Phumzile Mlambo-Ngcuka added later that much of this gross fixed capital investment was in infrastructure, which is also the largest component of money - R415,8 billion - committed by government as it moves to meet AsgiSA targets.
However, President Mbeki also cited the crucial importance of the South African manufacturing sector to increase the supply of capital goods which are vital to infrastructure expansion, after he warned of supply constraints in his state-of-the-nation address in February.
He referred to the Competitive Supplier Development Programme announced by the Minister of Public Enterprises, Alec Erwin, in his ministry's budget vote on May 17, which aims to boost the sector to relieve supply constraints.
Public Enterprises said that local supply industries had not seen such high expenditure for at least 30 years, and that the Competitive Supplier Development Programme (CSDP) will focus on demand-side and supply-side measures aimed at boosting the competitiveness, capacity and capability of the local supplier base.
"The importance of this [the CSDP] in developing our manufacturing sector and our economy as a whole cannot be overemphasised," President Mbeki said on Tuesday.
An annual Industrial Policy Action Plan to realise the objectives of the National Industrial Policy Framework will be finalised by Cabinet in the next few weeks, he added.
This framework will focus on key sectors of the economy and "will indicate how best to leverage public spending for industrial development".
The action plan will be incorporated into government's programme of action from next year onwards.
The President also announced a key survey of household incomes that help government to better target interventions in the provision of services.
Fieldwork for the National Income Dynamics Study will be undertaken between January and April next year, with the first sets of data emerging in 2009.
This data will create "the baseline against which we will be able to follow up changes in income and expenditure among these households for many years to come", he said.
Combined with a comprehensive anti-poverty strategy, this data would help government with "specific interventions required in specific households to make the maximum impact" against poverty.
Related to increased service provision, President Mbeki said that government had started implementing a five-year strategic agenda to support local government as it moves to strengthen the capacity of government as a developmental state.
The three strategic priorities of the five-year action are to ensure practical and co-ordinated, hands-on support to municipalities by provinces and national government, including through programmes like the Project Consolidate intervention.
Another element is through strengthening the policy, regulatory and fiscal environment of the local government sphere, and addressing the "governance arrangements" of this sphere.