The South African Social Security Agency (SASSA) presented its Annual Report for 2011/12. Its key focus areas were to address challenges, to improve service delivery, to deal with automation of the Grant Management and Administration system, to make improvements to the payment methods and to strengthen financial systems to achieve a clean audit. SASSA was the major delivery network for government, and had improvement of the financial systems in order to obtain a clean audit.
Ms Peterson reminded Members of SASSA's areas of delivery and width of its network, and said that it had 9 937 pay points. SASSA remained one of the major delivery networks for government with more than 2 500 service delivery points, 335 local offices, 902 service points and the 9 937 pay-points. Particular highlights in the 2011/12 year included the appointment of the Chief Executive Officer, that brought stability, the increase in recipients of the social assistance programme to 10.3 million recipients, and appointment of a new service provider for payments. A summary of performance against priorities was given. The projections for reaching people, and the award of grants for Old Age, Disability, War Veterans, Child Support, Foster Care, Care Dependency and Social Relief of Distress were set out. The War Veterans and Disability grants had dropped; the latter due to better processes for assessment of disability. Internal Reconsideration Mechanisms had been implemented in this year, and this had led not only to 52% of requests being adjudicated within 90 days, but to a reduction in the litigation against SASSA. Business processes had been streamlined, and there were now standardised, and much shorter, forms being used that were specifically directed to the information needed, whilst the objective was to ensure that no matter which office was accessed, the client would receive the same information and treatment. 89% of the 1.2 million new applications were processed within 21 days. In addition to the business processes, there was improvement of infrastructure, with 75 offices being upgraded. 366 paypoints had also been improved. SASSA had managed to recover R34.8 from dormant accounts but may have to write off in the next year. The first phase of a new payment system had started in March 2012. Beneficiary information was reviewed, and information was updated.
In relation to SASSA itself, although there were 19 051 posts listed, only 9 137 were funded, and 8 437 posts were filled at the end of March 2012. All posts targeted for filling in this year were indeed filled, with an emphasis on critical positions. SASSA had an Employee Wellness programme, and had done skills audits, which would be carried out in other provinces. It had concentrated on developing an integrity model to reduce fraud and corruption and ensure good governance. The numbers of cases reported, prosecuted, and civil suits for recovery of funds, were outlined. Community Outreach was successful and 88% of complaints lodged were resolved within five days. SASSA had spent 86% of the budget, with some overspending on capital assets. An unqualified audit was given.
Members asked about the litigation, wondered if employees gave permission for medical screening, and asked for explanations on what was described as “savings” and on expenditure and supply chain management requirements. Members were concerned about the continuing problem of queues and safety of the elderly, the use of consultants, the impact of the card system, whether refugees and asylum seekers could receive grants, and questioned if SASSA’s planning was correct in relation to building and ICT. The high vacancy rate, absenteeism, and assistance to the children of ex-combatants were queried.
South African Social Security Agency Annual Report 2012
Ms Virginia Peterson, Chief Executive Officer, South African Social Security Agency, presented the Annual Report of the Social Security Agency (SASSA or the Agency) for 2011/2012. She firstly reminded the Committee of the mandate of SASSA, which was a Schedule 3a Public Entity, established in April 2006, to transform social security in South Africa. Its founding legislation was outlined. The strategic priorities were listed as customer care, systems integrity and Increased access to social security services.
The key areas of focus remained to address the problems and challenges in SASSA, but some of the other priority projects were, in this financial year, service delivery improvement, automation of the Grant Management and Administration system, improvements to the payment methods and improvement of the financial systems in order to obtain a clean audit.
Ms Peterson reminded Members of SASSA's areas of delivery and width of its network, and said that it had 9 937 pay points. SASSA remained one of the major delivery networks for government with more than 2500 service delivery points, including 335 local offices, 902 service points and the pay-points. In 2011/12, there were various positive developments that informed the strategic and operational direction. The appointment of the Chief Executive Officer had brought stability.
By the end of 2011/12, approximately 10.3 million recipients were benefiting from the social assistance programme and the number of benefits stood at 15.5 million. She mentioned that approximately 1.2 million social grants were processed. A new service provider was appointed in January 2012 to pay social grants on behalf of SASSA for the next five years. SASSA embarked on preparatory process to facilitate migration of beneficiaries from old contractors to new payment providers.
Ms Peterson then presented a summary of the performance, against the priorities.
Priority 1 was listed as customer care-centred benefits and administration and management of systems. She said the Implementation of the Social Assistance Programmes drove SASSA’s existence. SASSA had projected that it would reach 15.7 million people, and had achieved 15.5 million, or 4.4% increase in the number of grants, with the old age grant increasing from 2.6 million to 2.7 million beneficiaries. The War Veteran Grant dropped from 958 to 753 beneficiaries. The Disability Grant beneficiaries dropped from 1.2 million to 1.1 million, and Foster Child Grant beneficiaries increased from 512 874 to 535 747. The Care Dependency grant increased from 112 000 to 114 000 beneficiaries. The Child Support Grant went up from 10.3 million to 10.9 million grants. Kwazulu-Natal had the largest number of grant benefits, by grant type and region, as at 31 March 2012, with 3.8 million. The percentage increases were then given. The Grant-in Aid benefits increased by 13.83%; the Child Support Grant benefits increased by 5.36%; Foster Child Grant benefits increased by 4.65%; Old Age Grant benefits increased by 2.7% and the Care Dependency Grant increased by 2.5%.
Ms Peterson moved on to discuss the implementation of the Social Assistance programme. She said that SASSA had achieved 99% achievement on extending the Child Support Grant (CSG) to children up to the age of 18 years. In relation to Social Relief of Distress (SRD) the target was to disburse 95% of allocated funds in accordance with approved guidelines. This was exceeded, and the total expenditure on social relief was R189 million, an over-expenditure. This money was spent largely on families experiencing undue hardships, individuals awaiting grants and assisting families where the breadwinner died.
Ms Peterson then explained that SASSA had an Internal Reconsideration/Review Mechanism (IRM). It had received 12 393 IRM requests, of which 6 420 (or 52%) were adjudicated within 90 days.
The focus in the management of the Disability Grant was on improving the disability assessment processes and ensuring quality assurance of medical assessments. Improvements in assessment quality led to the purging of ineligible beneficiaries during medical reviews, and a general decline in errors. There was a net decrease of 20 789 in the number of disability-related grants.
The objective in relation to service delivery was to streamline business processes to achieve optimal value for money, ensuring a shift in manual processes and improving services rendered.89% of all new applications were processed within 21 days, and approximately 1.2 million new applications were processed, of which 1.06 million were processed within the 21 days mentioned earlier.
SASSA had managed to standardise business processes. Grant application forms had been reviewed and reduced, to eliminate information that did not add value to the processes, and this had managed to reduce the length of the form from 20 down to 5 pages. SASSA tried to ensure that every applicant would go through the same business processes, regardless of where he or she chose to apply or do business with SASSA. Therefore, there was a focus on standardising across all offices.
Ms Peterson noted the improvements in local offices’ infrastructure and said that 75 local offices were upgraded to suit the new standardised application process. The improvements included changing the office layout, installation of ICT infrastructure, branding, and provision of adequate seating space for applications and beneficiaries.
The main aim of the project to have effective and efficient payment systems was to improve pay points nationally. SASSA had achieved its target and improved 366 pay points. She said that the total expenditure as at 31 March 2012 was R13.8 million. Improvements included repairs to and / or upgrading of existing shelters, the erection of shelters (tents), the purchase and/or upgrading of ablution facilities, the provision of chairs, the construction of access ramps and the erection of fencing.
In relation to the accounts, Ms Peterson said that at least R34.8 million was recovered from dormant accounts, but old payment contracts were terminated at the end of the financial year and most of the remaining amounts may have to be written off. In order to improve the payment systems, a new service provider was contracted, in January 2012, to implement the new payment solution. The contract formally commenced in April 2012. SASSA had to undertake preparatory work prior to commencement of the contract, and this had included system conversions and trials, preliminary re-registration of beneficiaries who were previously paid by contractors, and card swaps. In March 2012, the first phase of the new payment solution was implemented for new grant applicants in all nine regions.
Ms Peterson outlined the targets for effective management of beneficiaries (see attached presentation for full details). 900 000 reviews were targeted, and 797 011 were done and the applicants notified. SASSA aimed to do 700 000 life certifications, but had achieved 1 369 424. 585 580 grants were lapsed as a result of these processes.
The updating of beneficiary records involved looking at backlogs and new exceptions. 32% of beneficiary records with backlogs were updated, and 395 769 beneficiary records with exceptions were resolved. The matters investigated included incorrect ID numbers, incorrect banking details, incorrect addresses and undeclared means.
Ms Peterson then outlined the achievements under Priority 2: Improved System Integrity and Human Capital Management. The total number of posts in the SASSA establishment was listed as 19 051, but only 9 137 of these posts were funded. SASSA had 8 437 employees at the end of March 2012. The target was to fill 1 496 posts, and 1 489 posts were filled.
She then explained the Employee Wellness Programme, saying that this was an attempt to control absenteeism from ill health. SASSA ensured that wellness education was promoted through its Employee Wellness Programme, and 2 487 employees participated in health-screening exercises to evaluate their health status.
A skills audit was done. Time and motion studies resulted in the development of staffing norms for all standardised operations in local offices, as well as the development of a capacity model, which included the job profiling of positions in line with standardised processes. A skills audit in the Western Cape was intended to identify skills gaps and the implementation of the necessary training interventions. The Skills Audit for the Finance Branch was not achieved due to reprioritisation in the organisation.
In relation to internal and risk audit management, the main priority of SASSA was the implementation of an integrity model, to ensure a culture of commitment, professionalism and discipline, to reduce fraud and corruption, and to ensure good governance. SASSA developed and implemented the Integrity Policy and the Ethics Programme. An Integrated Fraud Prevention Strategy was also developed, which would enhance the efficiency and effectiveness of fraud prevention, detection, investigation and resolution within the Agency. 2 509 fraud cases were referred to law enforcement agencies, including the Special Investigating Unit (SIU) for further investigation and prosecution. 1 048 internal fraud investigations were conducted by the Agency’s fraud and compliance staff and 40 469 beneficiaries were verified for eligibility and existence throughout the Agency. 2 488 people were brought before the courts and 2 258 were convicted. 5 414 people signed acknowledgements of debt valued at R43.7 million, for the repayment of fraudulent grants.
Legal Services intended to provide efficient and effective legal services to the Agency, and through these frameworks SASSA was able to decrease the number of litigation cases, particularly those relating to the social grants, from 15 224 cases in 2008/2009 to just 249 in 2011/2012 - a 98.36% reduction in litigation over a period of four years.
Community Outreach programmes had done well. A target of reaching 44 rural wards was set, and because of the driving force of the Minister and Deputy Minister, workers worked faster. SASSA was pleased that 98 000 beneficiaries in the rural areas were reached and serviced through the Integrated Community Rural Outreach Programme (ICROP). The target of 65 600 beneficiaries for the period under review was exceeded.
99% of queries were attended to and 88% of the complaints were resolved within five days.
In relation to the financial performance, Ms Peterson noted that the SASSA’s main cost drivers were cash handling fees, communication, medical services, leases, travel and subsistence, and property payments excluding rentals. She said that total expenditure for the period under review amounted to R5.2 billion (86% of the allocated budget) and the Agency showed a saving of about R881 million. The reasons for variance on expenditure were largely due to compensation of employees and goods and services, as well as transfers and subsidies and payment for capital assets. SASSA had overspent on Capital expenditure, particularly ICT equipment, but there were some other reasons (see attached presentation).
Ms Peterson noted that both the Department of Social Development (DSD) and SASSA had, in this year, received an unqualified audit opinions. The Auditor General of South Africa (AGSA) had said that the financial statements were a fair presentation of the SASSA’s financial position.
Ms B Mncube (ANC, Gauteng) asked what the key challenges in other provinces were that led to litigation against SASSA. She asked if SASSA had received permission from the court to have employees do the screening tests.
Ms Mncube asked why “savings” appeared under expenditure. She then asked about the under-expenditure on personnel, and why SASSA refers to this as “savings” if it had in fact failed to fill critical posts.
Ms D Rantho (ANC, Eastern Cape) started off by commending SASSA for a job well done. She then asked if there were any offices and/or centres that needed special attention and if there was a record of them, along with the exact needs.
Ms Rantho also raised concern about the queues when people collected their grants, and said that there were safety issues in these queues.
Ms Rantho asked about the Skills Audit in Western Cape, and stressed that because the Eastern Cape was likely to be different, SASSA should have a different programme for this province.
Mr S Plaatjie (COPE, Limpopo) asked about the increasing use of consultants, and asked if there was a compelling reason for it. He too questioned the impact of the “savings” and asked about its impact on the audit. He wanted to know what SASSA had done to ensure that there was strict adherence to supply chain management requirements.
Mr M De Villiers (DA, Western Cape) asked what the situation was, and what had been done to rectify the shortage of commissioners in the Eastern Cape. He then asked for more information about people from outside the borders receiving grants. He was worried about the over spending on ICT, and said that SASSA clearly was not planning ahead. He also wanted to know why the Building Infrastructure Plan was not met, and whether it was necessary to make further investigations into that Plan, and what happened to the funding.
Mr de Villliers was also concerned about the high vacancy rate. He also noted continuing problems with the pay points and personnel, particularly in the rural areas. He lastly wanted to know how SASSA was playing its role to alleviate the problem of poverty in the society.
Mr W Faber (DA, Northern Cape) asked why only 75 offices were upgraded and when all of the offices would be completed. He then mentioned that, in relation to the predetermined objectives, 27 were not achieved, which was almost half of the targets. He wanted more information on this.
The Acting Chairperson mentioned that the standardisation of the offices was welcomed, and she hoped that it would work. She asked if there was sufficient monitoring and adherence to the supply chain management requirements, and wanted to know specifically what SASSA had done in relation to this.
Ms Peterson noted that many of the litigation challenges came from the beneficiaries. There was a substantial drop in litigation in the year under review, and this was largely ascribed to the fact that the appeals process was now working, which made it less necessary for people to litigate against SASSA. As far as she was aware, the DSD had dealt with most of the appeals. The amendment processes were working that introduced the appeals and IRM.
Ms Peterson noted that the employee health tests were all done on a purely voluntary basis, and nobody was compelled to take any tests.
She explained the reference to “savings”. In 2010, SASSA had faced some severe financial difficulties. Therefore the management had devised a plan to allow SASSA to save money in various areas. For instance, the kilometre allowance for District Managers was reduced, none of the officials travelled Business Class, and an austerity plan was implemented in general across SASSA and DSD. SASSA received a letter from National Treasury commending it for the savings, and its application to have the savings amounts (paid over to Treasury) was approved and the funds were given back.
Ms Peterson explained that the new system of issuing cards to beneficiaries was good, but people tended to forget their PIN numbers, so SASSA had been forced to levy a charge for replacement cards: some people were asking for cards to be replaced every month. Now, if the older people were not able to remember their PIN numbers, the cards could simply be swiped.
Ms Thandi Sibanyoni, Manager, SASSA mentioned that 72 offices were targeted for upgrade in this year, but now that SASSA had received funding, it planned to improve the number to 120 offices.
Ms Peterson added that SASSA aimed to have offices that were accessible to old people and therefore to have offices on ground floors, near public transport and main roads. She said that SASSA also planned to cut the long queues in front of banks. SASSA held monthly meetings with the Reserve Bank and had requested that the question of reducing or having differential bank charges for older people must be discussed. More attention and consideration must be given to older people at the banks. SASSA planned to invest in pay points, for example where ATMs were not found, in peri urban and or rural areas.
Ms Peterson clarified what the Standardisation and Upgrading of Offices entailed. Standardisation related to the processing of applications for grants. A six-stage process used to be followed, but SASSA had managed to cut that down to a three or four-step process or model. Upgrading, by contrast, referred to the physical upgrade or improvement in office facilities, such as making sure that there were benches, having water fountains for customers, and modernising the offices. SASSA would like to have a system showing queue numbers, so people knew how long they would have to wait and where they would not have to worry about losing their place in a queue.
Ms Peterson agreed that the skills audit done on the Western Cape was not the best example, but it was selected as a standards reference point. In the other provinces, due regard would be taken of the differences, including the distance. The Northern Cape had fewer people, and greater distances, and the rural nature of some provinces would be considered.
Ms Peterson assured the Members that in the 2011/12 year there had been a need to hire specialist consultants. This would not be repeated every year, and in the 2012/13 year the same figures would not show. SASSA’s work was ICT-based and for this reason specialists were needed.
Ms Peterson noted the comments on supply chain, but said that although the AG had gone through the audit three times, to ensure compliance with rules and regulations, it could not be find anything wrong. For this reason, SASSA was appealing against the judgment of the court in the case mentioned.
Mr Frank Earl, Acting Manager, SASSA, said that the issue of having a Commissioner of Oaths had been a challenge for many years, as currently SASSA relied on the SAPS to verify affidavits. SASSA had applied for its staff to be appointed as Commissioners of Oaths to assist the pressure on SAPS.
Ms Peterson mentioned that she was concerned about SASSA staff who were at level 5 being used as Commissioners of Oaths, and would rather keep the appointments at Level 7.
Mr Earl then dealt with the issue of foreign nationals. He agreed that SASSA had to make it quite clear who was entitled to access grants. From 1 April 2012, refugees, but not asylum seekers, had access to grants. There were processes to ensure that only the right people received grants. SASSA was working with the Department of Home Affairs. He noted that no asylum seekers were benefiting from the grants at the moment.
Ms Peterson said that the planning and priorities addressed customer needs. The aim, in this financial year, was to fill critical posts, and that meant filling of level 5 and level 7 posts. She had made a decision not to appoint more people, and buy more computers, for ICT. SASSA was aware that there was a lot of work to do.
Mr Clifford Appel, Chief Financial Officer, SASSA spoke on irregular expenditure and non-compliance, assuring Members that irregular expenditure had been corrected. He also explained the savings, and drew the distinction that not everything remaining at the end of the year was a saving, as there would still be money payable for certain items, and this could also include work-in-progress.
Ms Mncube asked how SASSA controlled absenteeism.
Mr Plaatjie also raised questions about absenteeism and leave, and asked whether SASSA had leave dispensation mechanism. He also wanted to know how effective the wellness programme was in reducing absenteeism.
Mr Plaatjie asked for more detail on the recent judgment against SASSA.
Ms Rantho asked what SASSA could do for ex-combatant’s children who might not have a South African Identity Documents, to enable them to further their education.
Ms B Dlamini, Minister of Social Development, noted that the DSD was working with the Department of Defence to deal with the issues affecting ex-combatant’s children who were South Africans.
She also noted that the Ministry of Social Development was trying to focus on preventative programmes to ensure employee wellness. SASSA needed to be encouraged to do more in this regard.
The issue of monitoring and evaluation followed the decision of a Ministerial Legkotla that SASSA must extend its footprint and reach out to wherever people were living. There were plans to sign a Memorandum of Understanding (MOU) between SASSA and Traditional leaders but there was a need also for local government to become involved. There was going to be some change to some of the traditional authorities. Another initiative was to try to ensure that people would be paid from villages and from paypoints closer to their homes and although this was still at discussion stage, she did want to stress, to the Committee, that the DSD and SASSA were intent on improving services to the people.
Ms Peterson pointed out that 57 000 days were taken as sick leave days in this financial year. She said that it meant that people were absent, on average for nine days extra, on top of their normal leave. Sick leave was seen as a problem across the whole public service.
Ms Peterson said that the ruling of the court recently was based on the affidavits of the company who failed to get the tender.
The meeting was adjourned.
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