Social Development: Minister's Budget Speech

Budget vote speech by the Minister of Social Development, Mrs Edna Molewa, National Assembly, Cape Town

23 April 2010

Honourable Chairperson
Honourable Deputy Minister of Social Development
MECs of Social Development
Honourable Members of Parliament
Distinguished guests
Ladies and gentlemen

During the course of last year, and against the backdrop of the persistent legacy of apartheid deprivation, and in the context of the worst global financial and economic crisis since the 1930’s, social development continued to prevail, to make real and measurable progress and brought hope to millions of South Africans. “Hope that is not just a dream, but a way of making dreams becomes reality.”

Social Development has implemented its mandate through its three key areas of social security, welfare services and integrated development.
In executing the social security task, we increased access to social assistance, further developed policy proposals for a social insurance system and supported efforts to draft improved regulatory proposals of oversight of private pension funds.

The scope of our welfare services grew at an unprecedented rate as we again brought support to children at risk, supported many women in achieving their emancipation from oppressive conditions, brought hope and meaning to youth in despair, empowered many people living with disabilities, sustained vulnerable older persons, and many more.

Our integrated development programmes of community development has removed the impediments for multitudes to engage in sustainable livelihoods; significantly increased access to public works programmes to find the dignity that comes with work, supported people living with HIV and AIDS to enjoy life more fully, and more. It is to these challenges that we will continue to devote our attention, to make progress and bring hope, sparing no measure of effort in executing our mandate. Re bolela se ntle lego tšhoga, gore ditekanyetšo tšeo palamente ye ere abetšego tšona ngwageng wa go feta wa ditšhelete, re e somisitše gabotse.

Re sa tšwela pele go hlokomela badidi, gomme retlo tšwela pele go dira jwalo ka gobane mošomo o sale o montši, le leeto la rena e sale le le telele. Re ikemišeditše, gomme re le holofetša gore reka se nyefiše go tšwela pele go thuša ba dikobo di magetleng.

Honourable chairperson,

We are still waging a war for economic opportunity, social justice and social inclusion. “The contradictions in our society is explosive”, to quote Franz Fanon, author of The Wretched of the Earth.

Many millions of our people eke out a living as they are preoccupied solely with survival. Over 5.2 million South Africans are jobless. For many, when work is available, pay is low and conditions often barely tolerable. Social security such as unemployment insurance, retirement savings, sickness or death of a wage earner remains elusive.

Permanent insecurity is the condition of the poor. Flood, drought or disease affecting people or livestock can destroy livelihoods. These vulnerabilities are exacerbated by the environmental factors such as climate change and global warming.

Persons with disabilities constitute the most vulnerable section of our society as disability is linked to poverty, the elderly face abuse, over and over again, and that by members of their own households. In the midst of such despair the poor turn on themselves in violent ruptures, and social convulsions. Women and children often suffer the brunt of such paroxysms and their ability to make choices is extremely limited. Choices about sexual orientation, resource allocation and reproduction often lead to women being lampooned and lambasted. The youth turn to gangsterism, abuse drugs and other conducts of self destruction in their sense of hopelessness.

The combination of malnutrition, illiteracy, disease, underemployment and low income closes off the avenues of escape. It is a picture that I see all too often as Minister of Social Development. And it brings a lump to anyone’s throat and tears to the eyes.

And yet, there are those amongst us who blame the poor for the conditions they find themselves in. They convincingly forget that poverty is systemic. “Give them a rod to fish,” they say. Franz Fanon said so poignantly: The life of our nation is shot through with a certain falseness and hypocrisy, which are all the more tragic because they are so often subconscious rather than deliberate. The soul of the people is putrescent and until that becomes regenerate and clean, no good work can be done.”

George Bernard Shaw argued that “Progress is impossible without change, and those who cannot change their minds cannot change anything.” The ANC’s 2009 manifesto while building on the progress made, is about change in gear, no pun intended. The measures are responsive, it makes real commitments and gives hope for a better tomorrow for the majority of our people.

The ANC’s manifesto is clear and achievable

Our programme is based on clear objectives and achievable plans. It proposes:
* continued democratisation of our society based on equality, non-racialism and non-sexism
* National unity in diversity which is the source of our strength
* Building on the achievements and the experience since 1994
* An equitable, sustainable, and inclusive growth path that brings decent work and sustainable livelihoods; education; health; safe and secure communities; and rural development
* Targeted programmes for the youth, women, workers, rural masses, and people with disabilities.

We made these commitments, we promised to deliver them, and budget vote 18 contributes to their realisation. These commitments flow from the tenets of the Freedom Charter of the ANC, and they are encoded in the Constitution: whose main drafter is the ANC.

In line with the President’s call we will make this “a Year of Action” in executing our social development initiatives. We’ll make good on the President’s promise by “further expansion of public employment programmes, home-community based care and early childhood development initiatives and work harder to build a strong developmental state.”
We have heard the President’s exhortation to contribute to “a state that responds to the needs and aspirations of the people” and “a state that performs better, faster, harder and smarter.”

Honourable members,

Social Development’s expenditure grew from R61.7 billion in 2006/07 to
86.5 billion in 2009/10 at an average annual rate of 11.9 percent. That’s an MTEF budget of R210 billion. The allocation for this year, which we present to this house today, is more than R94 billion and increases to R114 billion by 2012/13. An MTEF budget of more than R300 billion is projected. 95.4 billion (99.4 percent) of the budget allocation are transfers.

Provision of social grants makes up the largest portion of the budget, approximately 93 per cent (R89.4) in the current financial year. The other major transfers include R5.6 billion to the South African Social Security Agency (SASSA) to administer the grant system and R87.2 million to the National Development Agency (NDA) to strengthen civil society organisations and support development initiatives in rural areas. A further R226 million goes towards social work scholarships and R43.4 million to Love Life to implement HIV and AIDS prevention programmes.

I will now detail some of the salient features of the expenditure programme.

Comprehensive social security

Our envisaged comprehensive social security system has three pillars which are: Social Assistance, Social Insurance and Voluntary Savings.

The first pillar, the social assistance programme already covers just over 14 million South Africans. And true to our Manifesto promise, we have extended the child support grant to all children born on or after 31 December 1993; all those born in the year of our democracy. The extension of the child support grant will be phased-in to cover over 2.1 million eligible children under the age of 18 years by 2011/12.

As promised in the manifesto, we equalised the old age pension on 1 April. Men of 60 years, who meet the means test criteria, became eligible for the old age pension.

In a related development and in giving effect to a Polokwane resolution, we have this year introduced in Parliament the Social Assistance Amendment Bill, which seeks to amend the definition of disability and provides for the introduction of a common, harmonised assessment tool, to ensure a uniform and objective assessment of disability. The Bill will give effect to Parliament’s original intention: those that are disabled, to the extent that they cannot be gainfully employed as a result of one or the other impairment, should qualify for the disability grant.

In excess of R140 million will be available for social relief of distress to provide income support for those who may be left vulnerable as a result of a sudden catastrophe. We will in the course of the financial year bring to Cabinet the Social Relief Bill which will seek to shift the delivery responsibility of the programme to provinces. This should make our response to people’s emergency needs faster and more efficient.

We will respond to President Zuma’s appeal to make “government work faster, harder and smarter”. The SASSA will embark on a number of innovative service delivery improvements over the MTSF period. Central to these is the improved grant application process, which seeks to resolve challenges relating to the grant application process. Our intention is that social grant applicants should be given the outcome of their applications on the same day.

Honourable members,

Leakage in the social assistance programme is an affront: We will uproot fraud, eradicate corruption and will spare no effort to bring to justice those who compromise the integrity of the grants system. We have scrutinised hundreds of thousands of dormant bank accounts of beneficiaries to assess their eligibility. We will make an announcement on the outcome in due course; suffice it to say we will save hundreds of millions of rands.

In response to the Minister of Finance’s petition to do more with less, we have assessed the cost of paying social grants. There is a need to change the current model of paying 80 percent of our social grant recipients through the cash payment contractors system. This method is inefficient, ineffective and not financially sustainable.

Chairperson, reviewing the payment system is no easy task. The public demands a system that is transparent and where the costs of providing such a key service are reduced. As government we are obliged to source cost effective and perhaps more developmental means of providing these services.

While we are embarking on all these business process redesign initiatives, we have no intention to force social grant recipients to migrate to a payment system and thereby adversely affect them.

We regret that so many have waited so long for their appeals to be dealt with, especially those applicants in KwaZulu-Natal and Eastern Cape. We will prioritise their plight. We say: Thokolathemba amathunzi ayewukela ukulungisa lesosimo umyango usungule uphiko oluzimele ukubhekana ngqo nalezozicelo zezibonelelo ezazingaphumelelanga. Kuyintokozo ukunazisa ukuthi kunesamba esingangezigidi ezingamakhulu ayisikhombisa nanye
(171 million) sesibekelwe loluphiko ukuze lukwazi ukubhekana nalengqinamba ezwenilonke.

Honourable chairperson and members,

The second pillar of our social security system is Social Insurance.
While social assistance aims to alleviate poverty, the goal of social insurance is to prevent poverty. Regrettably, too many previously employed people in South Africa fall into poverty because: we do not have a mandatory retirement system, millions of workers do not insure against disability and, yet millions more breadwinners, do not save to ensure that their surviving dependents have income in the event of death. Many employed people are also not covered for unemployment insurance and the system for compensation for work related injuries is fragmented. Consequently, millions of former employees become dependent on the social assistance system.

In addition to the consolidated government document on social security reform, we have developed detailed reform policy proposals that will inform the implementation over the MTSF.

The key social security reforms relate to setting up a mandatory system of social insurance, especially a retirement system, with disability provisions and benefits for surviving dependents in the event of the death of the breadwinner.

The Minister of Finance will provide detail on the reform of the private pension funds. But I dare say, we will take on the big insurance companies and the bureaucracies to bring down the costs of retirement and healthcare savings, to remove the opacity of products, to improve governance of funds, ensure trustees exercise their fiduciary duties, etc.

A business case to reform the institutional arrangements for social security has also been completed. The aim is to integrate social security policy development to ensure coherence, and consolidate service delivery of the various social security benefits to achieve economies of scale and make service provisions seamless.

We view our participation in the International Social Security Association (ISSA) activities as important, particularly as we embark on the process of developing the comprehensive social security system. We will, in the course of the current financial year host the 30th ISSA General Assembly and the World Social Security Forum from 29 November to 4 December 2010. Key amongst others, the conference will discuss issues pertinent to our own social security system such as the extension of social security coverage.

Welfare services

The Great Mahatma Ghandi once asked, "Recall the face of the poorest and the weakest women/man whom you may have seen and ask yourself if the step you contemplate is going to be of any use to him. Will he gain anything by it? Then you will find your doubts and yourself melting away.” We can and must bring hope in the midst of such despair.

Our pursuit of our welfare services intervention is vast. Maatskaplike diens intervensies is wyd in omvang. Dit sluit onder andere in kwesbare kinders, die jeug, gestremde persone en die oue van dae. Een van die Departement se eerste prioriteite is die implementering van die Kinderwet, 2005 (the Children’s Act of 2005 soos gewysig) sowel as die Wet op Ouer Persone, 2006 (the Older Persons) wat aanvang geneem het op 1 April 2010. Die implementering van dié twee wette sal die grontwetlike regte van kinders en ouer persone in die land bevorder, en realiseer sowel as ander beleidsdirektiewe en internasionale ooreenkomste. Daar is hoop en ons, die ANC, maak vooruitgang.

Chairperson, just as these pieces of legislation are the product of a remarkable partnership between government and civil society, the effective implementation thereof will require a continuation of that partnership, at all levels, to achieve the objects of the acts.

Worthy of note is that our reach of care and support services will be enhanced through a laudable partnership with the German Development Bank to address the plight of child headed households.

The Child Justice Act also came into operation on 1 April this year. This landmark piece of legislation is designed to provide our country with a twin-track child welfare and justice approach which focuses on prevention, early intervention, diversion from crime and rehabilitation of children in conflict with the law. The Deputy Minister will provide more specific details on our state of readiness to implement the new provisions; our interventions to support vulnerable children, people with disabilities and older persons, and on the growing phenomena of substance abuse and human trafficking.

Integrated development

My department will support initiatives to develop, implement and evaluate a set of activation strategies for care givers of children who access the child support grant. This will involve skills development initiatives for potential work opportunities. In this respect we are in concert with Jeffrey Sachs, who in his book “The end of poverty”, argues: "The key to ending extreme poverty is to enable the poorest of the poor to get their foot on the ladder of development”. We have tested a poverty alleviation model that seeks to improve the abilities of the poor to be active in the economy. Two flagship projects under this model, namely HEMP and Vondelig Upliftment Craft, have yielded impressive results.

Non profit organisations (NPOs) have a major role to play in identifying, developing and implementing programmes and projects that promote genuine social development. In this respect we have made an additional allocation of R17 million over the MTEF period to strengthen the capacity and efficiency of the NPO registration unit, including the recruitment of additional personnel.

We must channel the energy and enthusiasm of young people in a more constructive manner. To this extent government initiated a number of interventions. One worth mentioning one is the Masupatsela Youth Pioneer Programme in collaboration with our Cuban counterparts. Collaborating and replicating the Cuban experience we want to make the youth active agents of change in communities. So far we have recruited 2 099 young pioneers and 120 mentors, making significant progress in our youth interventions.

Honourable chairperson,

The HIV and AIDS epidemic remains an immense challenge. We will, as we must, double our efforts with respect to tackling its further spread and reduce its socio-economic impact. Guided by the national strategic plan for HIV and AIDS and Sexually Transmitted Infections (2007 to 2011) we will work harder to contribute to the national goal of halving new HIV infections, particularly among young people in vulnerable communities including the farm areas. For this purpose, we have increased the allocation to Love Life to complement ongoing interventions.

In 2009/10 financial year, NDA funded 77 community projects to the tune of R95 million. These benefitted 7 185 direct beneficiaries, the majority of which is women, youth and people with disabilities. This year the department will allocate R87.2 million to the NDA, primarily to fund poverty alleviation initiatives of community-based organisations and cooperatives in poor communities. These initiatives contribute to the national goal of eradicating poverty, creation of decent work, education, food security and rural development.

Over the MTEF period we shall make conscious efforts to contribute to government’s goal of creating decent work through the Expanded Public Works Programme (EPWP) particularly targeting people with disabilities, women and youth outside the labour market. To this end we have accelerated our investments in the home community-based care and early childhood development. We will also continue our partnership with United Nations Children's Fund (UNICEF) and civil society organisations in the area of Early Childhood Development. It is my belief and that of our government that education is both a tool of social justice as well as a fundamental driver of economic development.

A very concrete partnership with the private and non-profit sectors centres on the community food bank initiative. Social Development has supported the establishment of four food banks with a R3,3 million contribution. These are in Cape Town, Johannesburg, Durban and Port Elizabeth. These food banks have provided close on 1.9 million meals on a monthly basis to poor households and created 91 full-time jobs. The department will support four provinces during the implementation of rural food bank projects in partnership with FoodBank SA. This programme is intended to cover the entire country.

Chairperson, our poverty reduction strategy coordinated by the Presidency seeks to pool of our resources. Similar to the NBI initiative, we have commenced to mobilise the entire donor community to partner with government in this endeavour. We continue to engage the business sector with a view to harnessing the approximately R4 billion that is spent on corporate social investment programmes per annum. This will do in order to “crowd in” this private sector investment in some of our country’s most underserviced municipalities.

Moves are afoot to set up the advisory board on social development so that we can on a more regular basis harness the support of the business community and other stakeholders.

Honourable members,

The policy plans and programmes outlined in budget vote 18 demonstrate that this government is responsive to the struggles of our people. We have made progress, and will continue to advance in this battle to bring hope to more people.

I would like to thank and acknowledge all the organisations and individuals that selflessly give of themselves to contribute to upliftment and care of other. In particular, I want to thank organisations such as the Gift of the Givers and Tiger Brands that have assisted people in distress at home and in places like Haiti.

Truly, together we can do more.

Before concluding, I need to inform this house about two important matters: the CEO of SASSA was taken through the disciplinary process and he has been dismissed. With regard to NDA, the appointment of the CEO of NDA is before Cabinet.

In concluding I want to express my heartfelt appreciation to my colleague and comrade, Mme Bathabile Dlamini, who has worked passionately, and will continue to work relentlessly to make this country a better place, to MECs for Social Development, Members of the Portfolio Committee, the Director-General, the acting CEOs of SASSA and NDA, the staff of the Department of Social Development and all NGOs and CBOs for the positive contribution they make to our work.

And I close with the most famous of all quotes on hope from our great icon: “It is an ideal which I hope to live for and to see realised”.

I thank you.