Department of Social Development & SA Social Security Agency (SASSA) Budget & Strategic Plans

Meeting report

The Chairperson welcomed Hon Bathabile Dlamini, Deputy Minister of Social Development, and said that the Committee looked forward to a good working relationship with her and the Department.

The Deputy Minister replied that the Minister would be joining the Committee on the following day, and that the Ministry was committed to working together with the Committee to improve the quality of life of the people.

Department of Social Development (DSD) Budget Hearings and Strategic Plan 2009-2014
Mr Vusi Madonsela, Director General, Department of Social Development, firstly gave an overview of the Department and its work. He said that the Department’s vision was for a caring and integrated system of social development services that facilitated human development and improved the quality of life. The mission of the Department was to enable the poor, the vulnerable and those previously excluded citizens to secure a better life for themselves. The Department would work with the people and with all who were committed to building a caring society. The constitutional mandate was to provide sector-wide national leadership in social development by developing and implementing programmes for the eradication of poverty, and for social protection and development amongst the poorest of the poor and most vulnerable and marginalised.

Mr Madonsela outlined the pieces of legislation for which the Department was responsible. He then explained the structure of the Department, headed by the Minister for Social Development, Hon Edna Molewa, the Deputy Minister, then the Director General and seven branches led by Deputy Directors General, being Strategy and Governance; Financial Management; Corporate Services; Social Policy; Comprehensive Social Security; Integrated Development; and Welfare Services. He explained the responsibilities of the different branches. The DSD had nine provincial departments and there were a number of district and service points at community level.

The Social Development Sector included the Board of the National Development Agency (NDA) and the South African Social Security Agency (SASSA). SASSA was a Public Finance Management Act Schedule 3A public entity, responsible for the administration and payment of social grants. The primary mandate of the NDA was to contribute towards the eradication of poverty and its causes by granting funds to civil society organisations for the purpose of carrying out projects or programmes aimed at meeting development needs of poor communities, and by strengthening the institutional capacity of other civil society organisations involved in direct service provision to poor communities.

The Social Development Sector, which included the agencies SASSA and NDA, were in the cluster system of seven comprising Social Protection and Community Development, and were Co-Chairs together with the Department of Human Settlements. The DSD was also a key player in other clusters such as the cluster on Security and Crime Prevention; and in the Governance and Administration Cluster.

Mr Zane Dangor, Chief Operations Officer, DSD, outlined the key strategic priorities, as tackling issues of child poverty, adult and older person’s poverty, issues of social cohesion, which included substance abuse, youth development, sector capacity building, governance and institutional development and establishing regional and international solidarity and engagement.

He set out the annual performance targets. In the area of Comprehensive Social Security, these included reduction of poverty, vulnerability and risk exposure through social assistance, improving the tribunal effectiveness and efficiency, setting up a comprehensive appeals stakeholder liaison framework, and reviewing and proposing reforms on the social security legislation around appeals.

In the area of Welfare services, the targets were to improve welfare service delivery by developing, piloting, then implementing norms and standards. It hoped to reduce substance abuse by developing regulations by 2010, transform services to older people by service delivery guidelines to be drawn by 2010, develop policies and strategies on disability by 2011, and have an integrated plan for the Family Policy by 2009. A shelter strategy and victim empowerment policy was also to be developed in this year. The implementation of the Children’s Act would also be worked upon.

Community Development would be concerned with protecting and empowering vulnerable youth, and youth services would have been audited by March 2010. The DSD aimed to complete and launch the sustainable livelihood toolkit for Community Development Practitioners by March 2010. It would develop a concept document on community food banks by March 2010, and establish community food banks in the following years. A national Community Development (CD) framework would focus on professionalism and skills development plans. All non profit organisations (NPOs) would be registered within two months of receiving applications. Guidelines to try to mitigate vulnerability to HIV infection by promoting behaviour change would be set up.

Mr Coceko Pakade, Chief Financial Officer, DSD,  gave a brief overview of the DSD financial outlook for 2008/09. He noted that the DSD was also affected by the global economic meltdown. Its budget was never enough. He took members through the past performance in terms of budget and indicated the allocation for the current financial year (see attached document). He noted that over the past three years the Department had spent not less than 98% of budget. The bulk of last financial year’s allocation was for social assistance, all of which was spent, and the remainder was largely directed to social grants. He reminded Members that in 2008 there had been policy changes allowing men to receive grants at sixty years of age, and extending the Child Support Grant to children up to fifteen years of age. The underspending was small when seen against the total allocation.

Mr Pakade said that a challenge presented itself in the catching-up of the year on year rollover of commitments. Because of competing funding priorities on major projects such as the social assistance, some of the work that Mr Dangor had outlined had suffered. In 2007, the first part of the budget went to outstanding commitments from 2006. He noted that DSD was given a substantial allocation for implementing the Management Information System (MIS) through SASSA. In 2008/09 there were two large outstanding payments from the Eastern Cape Social Assistance, and DSD received only about R11 million rollover, despite requesting R40.4 million from National Treasury.

DSD had requested R7 billion in respect of the Social Development Bids, and there was R2.2 billion allocated for Child Support Grants and R2.5 million (as opposed to the R3.2 billion requested) for SASSA. The effect of the policy changes would really be felt this year. There were other allocations that could only be used for named purposes, and these were largely transfers to agencies and to other large institutions.

Mr Pakade outlined the reduction to the baseline figures; R86.2 billion was awarded. The vacancy rate, previously standing at 21%, had now reduced to 10%, but the effect was to put pressure on the goods and services budget. The budget allocations were growing at about 12%, which was fairly healthy, but most of that money was earmarked for specific purposes. He tabled a pie chart showing the distribution of funding, of which the bulk went to administration, which was critical to support implementation of programmes. IT costs were being monitored. The expenditure looked in order, but the Policy Development, Review and Implementation Support for Welfare Services was under pressure and some tough decisions would need to be made in terms of the funding.

Mr Pakade then summarised that there was insufficient funding to support work for the Ministry in the Democratic Republic of Congo, which would be reduced. The litigation costs on the grant applications and appeals put strain on the budget. There was serious pressure on infrastructure, especially office accommodation. The establishment of the Social Security Inspectorate and Appeals Tribunal would cost a lot of money. The implementation of the Occupational Specific Dispensation (OSD) for Social Work Professionals, backdated from 1 April, also placed pressure. All these points had been raised with National Treasury. SASSA would highlight some further problems. DSD and SASSA had requested National Treasury jointly for assistance to deliver on the key commitments, especially in implementing the new Children’s Act and the Older Persons Act.

Mr Madonsela added that there was not a lack of will in the Department, but a severe lack of resources constrained the DSD’s ability to deliver on its mandate.

Discussion
Ms H Lamoela (DA) thanked the Department for their presentation, and said the conclusion was as expected. She had always suggested that people be provided with skills because the day would come when the Department would be hard hit, especially with the current national economic crisis.

Ms Lamoela stressed that the alleviation of poverty could not be addressed just by means of grants. She asked if there was any strategy in place to uplift the people to alleviate poverty in other ways. She pointed out that not all those receiving grants were disabled and something could be done to get people back into the workplace, so they could regain their dignity and provide for themselves. Many people, especially in the rural areas, had applied for grants but had been waiting for months on end. Some strategy was needed to provide for them.

Ms Lamoela asked the Department to expand on cost saving measures implemented to decrease expenditure.

Ms Lamoela questioned the number of social workers who had completed their courses and yet had not been employed by the Department.
 
Ms N Gcume (COPE) asked for clarification as to why NDA was operating at a provincial and not in a district level, saying that people experienced problems in getting to the Agency. Few people in the rural areas even knew about it and she wondered what was being done by way of information, who was supposed to disseminate the information and what would be done to address the communication breakdown between communities and the department.

Ms Gcume agreed with the earlier point about dependence on grants. She noted that many communities had the mindset of depending on them, and said that the Department should have plans to change that mindset to one that recognised that grants were only for the truly needy, and to be very strict about that.

Ms Gcume said that it was a disgrace, as set out in the NDA presentation, that funds were given to a particular project when that project did not exist at all. She pointed out that child grants must be used for the child, and asked what criteria were used for monitoring and evaluation.

The Chairperson asked for an explanation of the link between social grants and the role these played in alleviating poverty.

Ms N November (ANC) congratulated the Department on a good job but said that she remained concerned about the loopholes evident in the monitoring, and also in the number of Early Childhood Development centres.

Ms Lamoela then said that she had many substantial questions and she suggested that, since time was limited, these should rather be put to the Department in writing, to receive a written response.

Ms S Kopane (DA) said she would also submit questions in writing to save time.

Mr Madonsela replied in general to the questions around social grant applications, but said that SASSA would also deal with this in more detail. He said that the turnaround time for social grant applications had improved remarkably, and he was surprised to hear that there were people who had applied for grants and were still waiting – he would like their names. He commented that whilst anybody could apply for a grant, not all would be found eligible and possibly this was the reason why some people complained that they were still waiting. Most people, however, would know before they left the SASSA offices whether their applications had been approved. The Social Grants were Government’s biggest and most successful poverty alleviation measure, but he agreed that attention should still be paid to uplifting the people. The primary responsibility of the Department was, in every way possible, to assist people who were poor, including a cash transfer programme. However, outside of that cash transfer, the DSD was working with beneficiaries of social grants to link them up to other opportunities. The Expanded Public Works Programme (EPWP) was one area that was targeting able-bodied people for longer-term jobs, who might, for instance, also be receiving child support grants, and trying to offer them employment opportunities and learnership programmes in government. The primary responsibility for creating economic opportunities was not, however, the responsibility of the DSD. DSD must concentrate on its mandate.

Mr Madonsela said, in regard to social workers, that the Department had a scholarship programme worth R350 million for the year. There was a sizable number of students studying social work, and the various provinces had placed those who had graduated. Social workers were indeed a scarce skill in the country as the numbers that universities could graduate in any year were less than the vacancies for them in the Department. DSD was also trying to balance the need for more social workers with the quality of the graduates; some could not do the work because they were not properly trained. DSD was working together with the universities to balance these needs.

Mr Pakade said that the former Minister of Finance had made it clear to Parliament that departments must look at cost saving measures. The nature of DSD work involved a lot of travelling, so the biggest cost driver was on subsistence and travelling. The DSD had tried to reduce both international and local travel by reducing the numbers of delegates and teams visiting projects. It was using internal skills for tasks such as setting up programme offices, instead of using external consultants, such as in information management and technology. It was also strengthening the project management office that would coordinate all the projects running in the Department. The donor coordination strategy was being strengthened. Most departments struggled to get donor funding, but DSD was fortunate with certain areas where there were willing donors.

The Chairperson welcomed the news that officials were travelling economy class. She pointed out that she would not only like to see a good budget, but also would like to see the Department receiving an unqualified audit report. She said that the Committee had empathy for the budget pressures. It was heartening that there had not been any drastic budget cuts, especially in the poverty alleviation programmes. The Committee was looking forward to the DSD showing creativity and ingenuity to assist their clients, who were poor and vulnerable people struggling to survive every day.

South African Social Security Agency (SASSA or the Agency) programmes and priorities
Mr Fezile Makiwane, Chief Executive Officer, South Africa Social Security Agency, gave an overview of the social upliftment programme that SASSA provided and the priorities going forward. The main governing pieces of legislation were named as the Social Security Act and the Social Assistance Act, both of 2004. He said that SASSA provided social assistance transfers that remained an important programme of society and government to reduce poverty and destitution in South Africa. SASSA provided coverage mainly for the State Old Age Programme (SOAP), the Child Support Grant (CSG), the Care Dependency Grant, the Grant In Aid, the Disability Grant, the Foster Child and Social Relief of Distress grants. It covered a quarter of the South African population under those programmes. Spending projections ranged between 3.3% to 3.4% of Gross Domestic Product (GDP)  over the Medium Term Expenditure Framework (MTEF) period and this level of spending put South Africa in the upper tier internationally in terms of spending on grants.

Mr Makiwane said that SASSA was pursuing the extension of the Child Support Grants, which were being phased in until children reached the age of fifteen. It was also dealing with a new tool in terms of disability assessment, and initiatives to improve the efficiency and effectiveness of the grant administration programme, and also the age equalisation in terms of the State Old Age Programme.

The Agency’s vision was to provide comprehensive social security services, to assist people to become self-sufficient, and also to support those in need. Its mission was to manage quality social security services effectively and efficiently for eligible and potential beneficiaries.

Key strategic objectives were to build a high performance institution that complied with good governance principles and to strive towards operational excellence with service delivery improvement to the beneficiaries.

SASSA supported values of social cohesion and families. It undertook to render services in a transparent way, to be equitable in service delivery, and to pursue integrity of its staff, confidentiality and a customer care-centred approach.

Mr Makiwane then gave more details of the main priorities. In terms of customer care-centred benefits he said that this covered policy issues around the extension and phasing in of the Child Support Grant up to the age of 18. SASSA would develop a beneficiary maintenance framework to ensure that beneficiaries in the system were properly audited and were still entitled to receive benefits. The payment mechanisms were currently structured so that beneficiaries either went to pay points to collect their benefits in cash, or money would be loaded into their beneficiary accounts. Over 70% were receiving payments in cash, and this was risky, but also expensive in that security guards would need to be hired and other challenges would be found. It was desirable to move more towards direct banking. The management model currently had the grants being managed by doctors and there were differing interpretations.

The second priority of improved organisational capacity included building infrastructure, which was currently inadequate; the Agency had no building of its own and this increased the risk for fraud to occur.

Mr Makiwane noted, under the third priority of working to an integrated and comprehensive social security administration, that SASS was part of a comprehensive social security system. It had to look at building an institutional model in line with the legislative mandate, to enable it to take the appropriate initiatives and policy decisions at the right time, and ensure it could deliver on them. The Case Management System meant that when a beneficiary was accepted into the social security system, not only would he or she receive a grant, but the associated needs (such as health or social development interventions) would also be identified and the necessary referrals made. A person who received a Child Support grant, but who was himself able-bodied, could be assisted to find work in the EPWP or by receiving training, to try to break the cycle of poverty.
.
Mr Makiwane noted that the budget allocation for transfers to households continued to grow and was at R80 billion. The funding remained a challenge, as it was inadequate and demand exceeded resources. Other challenges were identified as a 60% vacancy rate. The lack of funding delayed finalisation of important projects and impacted on SASSA’s rural benefit reach as mobile units were very expensive to maintain. The inadequate buildings and sharing of offices were problematic. There were challenges regarding communication and advice to the public as to how to access the various grants. He had previously mentioned the necessity to use direct transfers to bank accounts. Internationally, the cost of delivery to beneficiaries was around 2% to 4% but in South Africa, because of the large number of cash transactions, this rose to 8%. Beneficiary verification to minimise fraud was also vital to ensure sustainability and the Department of Home Affairs could help in this regard.

Mr Makiwane concluded by repeating the remarks in the State of the Nation address that social grants remained the most effective form of poverty alleviation. However, limited resources posed a huge risk for effective and efficient service delivery. SASSA must work closely with other departments. He pledged his commitment that the Agency would  work with the Committee to create a better life for the people of South Africa.

Discussion
Ms Gcume asked for clarification on non-compliance with systems and processes.

Mr Makiwane responded that SASSA had essentially inherited some legacy challenges. There were some functions done by the provinces, that were not centralised in the Agency. This was to relate to what was being done by associated departments at provincial level. This was an institutional challenge that SASSA wished to have addressed.

 Ms Kopane asked how often the beneficiary maintenance framework was upgraded, saying that many people who were not entitled to receive grants would do so, thus preventing access by the most needy. She agreed that inadequate communication processes were a challenge and asked why SASSA would not work together with other departments and utilise other existing structures, such as ward councillors being asked to disseminate information.

Mr Makiwane responded that beneficiary maintenance required that there be life certification, to ensure that the beneficiaries were still alive, for the old age grants annually. Those grants that related to temporary disabilities, having a shorter life span, would need to be reviewed more regularly. There were also linkages with other databases, which would indicate where a review was required, as also the time period for which the grants had been paid. Those cases that overstayed their normal time in the system would be referred to a number of other organisations. This was a labour intensive exercise. In other jurisdictions there would be a physical check up on the households as to whether people were in fact there, and whether they were using their grants properly. In SASSA there simply was not the capacity to do this adequately.

Mr Makiwane responded to the comment on communication issues, by saying that the whole stakeholder net and partnerships became important. Regular calls were made to NGOs to assist, and the Minister would often meet with them; most of those were partners with the Department. They assisted in disseminating information and making people aware of the services that were available. Parliamentarians were also an important communication network, as they could do outreach in their constituencies and through other Government departments.  A Social Security official must not only learn about social security but must also understand what, for instance, Department of Home Affairs could also provide for an applicant. Government imbizos and other forums were also important for dissemination of information.

Ms Lamoela noted that the urban areas had one-day walk in/walk out programme of applications for grants. She asked if there was any indication how long it took to access a grant in the rural areas and whether there were still problems around applications in the remote areas.

Mr Makiwane noted that the legislation provided for a three-month processing period. However, SASSA did not think it fair that a poor person should wait for ninety days for assistance. An applicant, simply by reason of making the application, was already vulnerable and generally assistance would be given within three days or in some cases even on the same day, depending on capacity. SASSA would not turn a person away and insist that the full period pass. Government did provide Social Relief of Distress to cushion a person immediately until the final grant application was processed.

Ms H Makhuba (IFP) asked what SASSA could do to address the situation where the mother of the child might be receiving the money, whereas it was the grandparents who were raising the child on their old age grants.

Ms Gcume asked whether there was anything that could be done if a woman was claiming and receiving both a Child Support grant from the DSD as well as child maintenance from the father through the Maintenance Court.

Mr Makiwane said that the maintenance and Child Support Grants were not on an integrated system. The building of such interface was important. There was a need to know if a child was receiving some support from Government, or the National Schools Nutrition Programme, or through other members of the family. Case management, which was presently lacking, would deal with that issue but presently SASSA had to rely on declarations of income.

Ms P Xaba (ANC) referred to the Disability Management Model, noting that sometimes doctors would decide a person was fit for work, thus stopping the disability grant.

Ms Lamoela asked whether epilepsy was regarded as a form of disability, saying that those suffering from epilepsy usually came from the disadvantaged or poorer groups, were often on constant medication and could not take that medication at work.

Mr Madonsela said that the current definition of disability would not cover epilepsy or any chronic illness that would not fall within the definition of a physical or other form of disability that would prevent a person from entering the labour market. Often, illnesses were not actually disabilities but he agreed that they could impact on people in different ways. This was a long-standing policy debate that the Department was working on, and it featured prominently also in the Southern African Development Community (SADC) structures, particularly in relation to people living with HIV. The Department would continue to interact with the Committee on how advancements to the policy debates, before a dispensation relating to chronic illnesses could be finalised.

Mr Madonsela thus confirmed that the mere fact of epilepsy would not qualify a person for a disability grant, unless the doctor were to certify that the person was unable to enter the labour market because of that condition. It was primarily a medical question and also partly answered the question about doctors, who made their assessments independently to Department of Social Development.

Ms Lamoela asked for clarification on the impact of appeal tribunal delays on access to grants.

Mr Madonsela said that the tribunals were an innovation and were still being set up, but in the meantime there was one central Tribunal in Pretoria, which then travelled to various provinces to deal with provincial appeal matters. These mechanisms would be set up in the various courts where the cases were pending. The Appeal Tribunal was doing its best to catch up with the backlog of the appeal cases, and had made some significant progress. It was true that while the appeals were pending, people might face hardship. The appeals would be made by those people whose applications for grants had been refused by SASSA, and it was very seldom found that SASSA had acted improperly in refusing the grants. Nonetheless, to avoid potential hardship, the process was to be speeded up. There might be some cases where SASSA denied a grant, perhaps based on inadequate information, and once that information was made available the appeal might be upheld. He added that about 90% of the appeals related to disability, and that not every disability would qualify a person to receive a disability grant.

The Chairperson asked about the vacancy rate and staff complement. In 2005 SASSA had a mass recruitment campaign. She asked whether the vacancies were funded or unfunded, saying that if they were not funded then SASSA should rather draw up a new organogram that it could afford to staff.

Ms P Adams (ANC) also commented upon the vacancy rate, noting that the State of the Nation address had said that jobs must be created.

Mr Makiwane noted that SASSA was given a blueprint for social security establishment, with a minimum requirement that was seen as the necessary capacity to enable SASSA to deliver on its mandate. However there was mismatch between the blueprint and budget. The review process would touch on that, as Cabinet would need to be advised. If the positions were simply to be unfunded, this would affect service delivery.

The Chairperson asked if SASSA had explored a partnership similar to that between DSD and Transnet, to use containers, to at least create some permanent sites in the rural hours. This would enable services to be offered for longer hours, as the mobile units would not have to travel, and would be a cheaper way to offer Multi-Purpose Centres.

Mr Makiwane said that SASSA had approached the Department of Public Works, and Transnet, and those processes were ongoing. However, the use of containers would not address the need to build adequate infrastructure suitable for applicants coming for services. The infrastructure requirements were enormous.

The Chairperson asked if the growth in social services was to be seen as positive or negative.

Mr Makiwane responded that social security was a spin-off from the industrial period, and tackled failures from paid work. The whole philosophy underpinning it was that those who could not derive their income from paid work must be assisted by society as a whole. The South African Constitution provided that the State must intervene to protect those who could not help themselves, to avoid having a society with destitute people.  There would be growth of social security where there was a failure of employment creation, as people must then sustain themselves either through paid work or State assistance.

The Chairperson asked how the links with other poverty alleviation tools would work to enable families to move away from dependence upon social security, so that future generations would develop. She also asked whether having perhaps three generations of one family depending upon social security was acceptable, saying that this was perhaps a subject for future debate.

Mr Makiwane said that internationally the graduation from social security was tied to creating decent work opportunities. SASSA’S mandate was to address the vulnerable people, when they fell through the net of having no paid employment and no self-employment. SASSA, in uplifting those people as part of its core mandate, must also be mindful that it must refer such people to other government departments who could assist them, so  that such people would not again fall back into the net of demanding continual Social Development or SASSA interventions. The EPWP would become the main programme that would integrate and graduate those people. Over and above that, referral for training, for counselling and other interventions might be suitable platforms to assist people. Even giving them basic information to advise where they could receive necessary assistance would help to graduate them from the social grants programme. The Department was looking at a number of welfare work initiatives that in the long term would assist people to go back to work.

The Chairperson noted that SASSA had a large system and many beneficiaries and she was not surprised if there were some errors that crept in; allowance should perhaps be made for that.

Mr Makiwane said that SASSA had been reviewing the question of the abuse of grants, based on both international and local evidence. It was a difficult issue of social engineering, where assistance was given on the one hand, but limited on the other to certain specific instances. The caregivers should be the ones who were receiving the grants of children. On the whole, however, the programmes remained a very important pillar of society, and should not be withdrawn because of the few that were abusing the system. The grants generally offered  the opportunity for schooling and nutrition within the households, providing a greater social benefit.

The Chairperson said that Government should ensure that everyone who qualified could access the system. She asked for some details on those who did qualify.

Mr Makiwane said that the programme SASSA provided within South Africa was not a universal one. It was a social assistance programme, targeted to certain categories, either old age, or people with disabilities, or poor and vulnerable families with children. The Agency used a targeting mechanism called a means test. If a person fell below a certain means-test threshold he or she could be assisted. The policy interventions that the Department was looking at, specifically related to retirement, concerned basic pillar retirement reform, which included those on the social grant and those who were able bodied and earning some income. That was one element of addressing the means test challenges

Ms Adams commented on the Comprehensive Management Payment System and recommended the banking system as most suitable, and of most assistance to SASSA.

Ms Kopane alluded to a report in the Sunday Times on 17 May that approval was given to a transfer of R4.3 million, that was allocated for poverty alleviation, instead being used to pay for President Zuma’s celebration. This would appear to be abuse of State funds, and she asked for clarification, and for comment on the report.

A representative of DSD responded that the assertion that public funds were used was not correct. The companies that worked with SASSA set up their own private social responsibility funds, which supported the constituency with whom they worked, either children or people with disabilities or old age people. It was always understood that this was a private issue. No organ of State could coerce a private fund to support what were seen as desirable issues within the community. The funds used were not part of the voted funds of Government, and were not earmarked by Government to support any person. The funds that were earmarked by the private companies were to support children, not to support a function. Such funding could be used by the private organisations to provide other functions as well, such as support to the elderly. The money was not derived from the fiscus.

The chairperson announced that the Committee would be meeting the Minister and Deputy Minister and the accounting officers of the Department on the following day. She asked that Members submit their written questions to the Committee Secretary by Friday, so that they could be forwarded to the Department and answered by 23 June.

The meeting was adjourned.