Constitutional Court judgment: SASSA progress report

Social Development

15 August 2018
Chairperson: Ms R Capa (ANC)
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Meeting Summary

Members received a progress report from the South African Social Security Agency (SASSA) on the implementation of the Constitutional Court order. It highlighted the progress that had been made between April and August with regard to card swapping, payment challenges, risks, the phasing out of Cash Paymaster Services (CPS), as well as the payment plan for September.

SASSA had managed to successfully reduce the number of beneficiaries paid by CPS by 2 062 163, from 3 160 832 in April, to 1 098 669 in August. Since the issuance of the August pay-file, card swaps had continued and the number of cash beneficiaries had been further reduced by 196 802, to 811 009 by 6  August. The number continued to be reduced on a daily basis. There had been a general increase in the number of beneficiaries choosing to be paid into their own bank accounts. The August payment file included 9 795 132 beneficiaries who were to receive their grant payments at different banks. There were 936 680 beneficiaries in July who were to be paid through PostBank, using both the South African Post Office (SAPO) Mzanzi accounts, and the new SASSA/SAPO account holders. The number of beneficiaries paid through the PostBank increased to 2 542 543 in August. The increase was due to the intensified card swap programme aimed at migrating beneficiaries from the CPS payment platform to the new SASSA/SAPO card.

There had been payment challenges affecting over 700 000 beneficiaries using the new SASSA/SAPO card.  The root cause was mostly related to the inability of the SAPO systems to process real-time large volumes of transactions generated by the SASSA beneficiaries transacting on the National Payment System (NPS). Major issues identified were:

  • Late processing of the payment file by SAPO.
  • Failed transaction errors linked to transaction timeouts.
  • Connectivity and capacity of the payment link between SAPO and Bankserv Africa.
  • The over the counter (OTC) limit of R1 600, forcing some beneficiaries to perform multiple transactions to withdraw their full grants.

SASSA provided details of the actions being implemented to deal with these challenges, and Members generally expressed satisfaction with the progress made so far.

Members then discussed and adopted the third term Committee programme, where the focus would be on the initiatives being undertaken in the various provinces to deal with violence against women. Outstanding Committee meeting minutes were also adopted. 

Meeting report

South African Social Security Agency (SASSA): Progress report

Mr Abraham Mahlangu, Acting Chief Executive Officer (CEO): SASSA, began by apologising for not being able to present in person to the Committee in July, as he had been on the ground solving certain issues. He reassured the Committee that these issues had been solved successfully.

Ms Raphaahle Ramokgopa, Executive Manager: Strategy and Business Development, SASSA, presented on:

  • Progress achieved from April to August 2018;
  • Payment challenges and remedial actions taken;
  • Progress made in terms of phasing out Cash Paymaster Services (CPS);
  • Payment plan for September 2018, as well as the way forward for October 2018;
  • Risks and mitigations.

She said the total number of beneficiaries that were paid by CPS in August was 1 098 669. SASSA had managed to successfully reduce the number of beneficiaries paid by CPS by 2 062 163, from 3 160 832 in April 2018, to 1 098 669. Since the issuance of the August pay-file, card swaps had continued and the number of cash beneficiaries had been further reduced by 196 802, to 811 009 by 6  August. The number continued to be reduced on a daily basis through the daily card swap, and this net effect would be reflected only in the September payment file. 

There had been a general increase in the number of beneficiaries choosing to be paid in their own bank accounts. Following the provision of information related to the payment options available to beneficiaries, SASSA had received numerous requests for grant payments into personal bank accounts. The August payment file included 9 795 132 beneficiaries who were to receive their grant payments at different banks. The number of beneficiaries paid through other commercial bank accounts, excluding Grindrod and the South African Post Office (SAPO), was approximately 1 663 083 in August 2018.

Progress had been made on direct transfers to commercial bank accounts. Of the 9.7 million Automatic Clearing Bureau (ACB) beneficiaries, 5 589 506 were paid through Grindrod Bank. This included beneficiaries who were still using the old SASSA card in the National Payment System (NPS). The number of beneficiaries using Grindrod bank accounts had been reduced by 2 124 937 between June and August 2018.  This decrease was largely due to card swap /migration of beneficiaries from the old SASSA card to the new SASSA/SAPO card.  There had been no major reported challenges with the payment of beneficiaries receiving grants through commercial bank accounts, including the old SASSA card, except for those using the new SASSA/ SAPO card. 

There were 936 680 beneficiaries in July who were to be paid through PostBank, using both the SAPO Mzanzi accounts, and the new SASSA/SAPO account holders. The number of beneficiaries paid through the PostBank increased to 2 542 543 in August. The increase was due to the intensified card swap programme aimed at migrating beneficiaries from the CPS payment platform to the new SASSA/SAPO card.

Challenges and remedial actions

Ms Ramokgopa said payment challenges were experienced during the first week of the July payment cycle, affecting most of the 700 000 beneficiaries using the new SASSA/SAPO card. In terms of the Bankserv report, the transaction success rate for the new SASSA/SAPO card was at 25% and 50% for automatic teller machines (ATMs) and post offices (POs) respectively on 30 June, due to challenges in the system. There had been payment challenges affecting over 700 000 beneficiaries using the new SASSA/SAPO card.  The root cause was mostly related to the inability of the SAPO systems to process real-time large volumes of transactions generated by the SASSA beneficiaries transacting on the NPS.

Major issues identified were as follows:

  • Late processing of the payment file by SAPO.
  • Failed transaction errors linked to transaction timeouts.
  • Connectivity and capacity of the payment link between SAPO and Bankserv Africa.
  • The over the counter (OTC) limit of R1 600, forcing some beneficiaries to perform multiple transactions to withdraw their full grant.

To address the challenges in preparation for the August pay run which was scheduled for 31 July through to the end of the August payment cycle, SASSA, SAPO, Telkom/BCX and the State Information Technology Agency (SITA) worked in collaboration with industry partners, such as Bankserv and the Payments Association of South Africa (PASA) to upgrade and migrate the Integrated Grants Payment System (IGPS) system to the Telkom enterprise hosted environment. The current IGPS environment at the SAPO data centre would stay and serve as an interim backup.

The better server host capacity, as well as high availability on the server level, had resulted in improved capacity, which provide capabilities for the IGPS system to process up to 200 transactions per second (TPS) at peak time, from the previous 15 TPS. Connectivity with Bankserv had been improved by replacing the copper Diginet lines with high volume, high speed fibre dedicated links which can scale on demand. This had addressed issues of slow response and throughput. New upgraded links were used for connectivity for the end user devices. The splitting of the card issuing function from the transaction processing function on the IGPS system was completed on 12 July.  The splitting will allow for better load balancing between the two processes.

Subsequent to the implemented interventions, by 6 July the situation had improved and the transaction success rate was 99% for both ATMs and POs. The Inter-ministerial Committee (IMC) held a press conference to brief the public about progress regarding the transition and to apologise for the inconvenience caused by challenges experienced during the July payment run. Furthermore, the Minister, the Acting CEO of SASSA and the CEO of SAPO, had been on various news media to allay beneficiary fears. A workshop had been held with the payment industry/banking sector under the auspices of the Banking Association of South Africa (BASA) and the retail sector under the auspices of the Consumer Goods Council of South Africa (CGCSA).

For August, CPS was paying 1 098 669 beneficiaries at all 8 000 cash paypoints, except for the 1 000 that had been decommissioned. 7 252 589 received payments using own bank account, including approximately three million beneficiaries who were still using the old SASSA card in the NPS system. 2 542 543 beneficiaries’ payments were deposited through Post Bank account cards. SAPO will also pilot the cash payment solution at 18 sites across the country involving 4 201 beneficiaries

Plans to support August payments include:

  • SASSA-activated staff to support payments;
  • Presence at every decommissioned pay point to redirect any beneficiaries who may arrive;
  • Presence at post offices, major merchants and ATMs to support, respond to questions and assist beneficiaries;
  • Help desk at cash pay points still serviced by CPS;
  • Card swap desks at existing cash pay points to ensure the balance are issued with new cards;
  • Roving teams to move to smaller pay points for monitoring;
  • Dignity interventions on demand where queues are not moving

Generally there were no major challenges during the first week of August.  The majority of challenges received related to the IGPS system being slow in the morning hours, while the late arrival of cash-in-transit (CIT) affected some of the Post Office outlets. A number of reports were received of beneficiaries arriving at decommissioned pay points, and CPS paying beneficiaries. In some instances, SASSA officials were not allowed into the halls, and in a number of regions beneficiaries had challenges with regard to PIN resets -- both old SASSA cards and new -- as information on the location of PIN reset sites was not easily accessible or available at the local or national level. There were also instances of beneficiaries receiving less than their grants.  SAPO and SASSA were investigating the cases and Bankserv had been requested to assist. At limited service Post Office outlets, not all were paying or doing card swaps, and in most cases this was as a result of the system being down/offline, or no money having being delivered to the Post Office.

Ms Ramokgopa recommended that the Committee noted and supported their progress so far, and continue to support them until the end of September.

Discussion

Ms S Tsoleli (ANC) brought to SASSA’s attention that there was a payment problem in Mitchells Plain. She requested that more information be gathered about this. Although there were problems with the new system within her constituency, she was happy with how the problem was being handled. She asked how far SASSA was with refunding the cards that had been charged for transactions. Would the issues be processed internally through SAPO and SASSA, or would there be a tender for this? Not having a tender would increase government’s capacity and would also save money.

Ms C Dudley (ACDP) congratulated SASSA for handling the technical issues they had in an efficient manner. She proceeded to ask for more details on what exactly the automated card swap entailed. How much of this information was shared with the public? Was the SASSA office the only card swap facility? Were arrangements being made for people in hospitals and care facilities who could not leave these places? How did people access the home visits?

Ms B Abrahams (ANC) also congratulated SASSA on their progress. She asked what alternate arrangements could be made for people who could remember their pin numbers. Could seating be arranged at SAPO branches for the elderly? How much information was shared with the public with regard to the automated card swap system?

Ms V Mogotsi (ANC) gave credit to SASSA employees for the efficient work they were doing. She also raised the point of seating arrangements being necessary to assist the elderly at pay points. She made SASSA aware of some beneficiaries receiving double payments. Were the social workers not going to be in breach of their contracts where they were already employed, if they worked for SASSA as well? How were the elderly who were immobile going to be assisted with the card swap?

SASSA’s response

Mr Mahlangu began his response by acknowledging and appreciating the feedback from the Committee. He also appreciated the highlighting of beneficiaries who were in hospitals and care facilities, and said that there were teams designated to assist these beneficiaries. With regard to home visits, there was a number that could be called to request a home visit, or physically report to a SAPO or SASSA office. There had been collaboration with councillors in wards to help identify any beneficiaries that may be in need of a home visit.

The social workers that would be assisting SASSA would be new graduates that had not yet been employed, meaning that this would not clash with any existing contractual agreement. They would be paid a stipend. They would also be warmly accepted by the elderly that they would be assisting, as they were found to have good interpersonal skills. This would also put the elderly people at ease as they were likely to be less sceptical of the social workers collecting their grants for them through procuratorship.

Pin resetting was done at SAPO branches, as well as at SASSA offices. Now cash pay points would also have pin resetting facilities. Once the payment system was biometrically operated, remembering a pin would not be necessary.

The infrastructural problem was one that was rather tricky to address. In Gauteng specifically, the regional activities managers had been given the discretion to assess the situation at hand and then organise seating arrangements as required. This was an improvement from having the beneficiaries sit on the floor at pay points. Communities and NGOs were also assisting with ensuring the wellbeing of the elderly while they waited in line, which was much appreciated. The social workers would also function as queue marshals.

Mr Mahlangu said that the issue of double payments was one that he was not aware of.

Ms Diane Dunkerley, SASSA Executive Manager: Grant Administration, clarified that the reason why payments were not being made in Mitchells Plain was because they were still in the process of card swapping, which may be the cause of the problem.

The double payments that were being reported were a huge concern, as SASSA officials were not aware of this happening, and they would follow up on this issue.

With regard to the deductions, people were being asked to pay back charges that had never been charged before, and this was under investigation. As noted earlier in the meeting, the old SASSA card holders that were charged would be refunded.

8 453 home visits had been requested, and of that number, 2 403 still needed to be done. These visits were available only for people who were certainly not able to come into the office, and not for people who simply did not want to stand in long queues.

The Chairperson said that the reason why there had been an amendment to the invitation extended to SASSA was so that the issue of the panel of experts could be discussed. A Member did warn the Committee beforehand that when the panel of experts came into the picture, they might not want to leave. Their role was to ensure implementation, but it appeared that now they were playing an oversight role. It was clear that they did not report to the Committee. However, the Committee was in charge of the department of SASSA, and therefore a balance needed to be found between role of the experts and the Committee.
The use of private security companies, such as G4S, as well as cash payments, needed to be discussed with the Minister.

The Chairperson commended SASSA for their comprehensive report.

Ms Tsoleli requested more information on the cash payment points so that this information could be passed on to beneficiaries.

The Chairperson expressed satisfaction with the fact that SASSA was working with councillors at the ward level, as they are the ones who dealt more frequently with their constituents.

Third Term Committee Programme

The Chairperson referred to the oversight visits, and expressed concern over the number of women being murdered in the country, more specifically in the Eastern Cape. Most of these women were murdered because of suspicions of witchcraft. These suspicions resulted in violence against women, as they were hunted in broad daylight. After having approached various commissions to deal with this prevalent issue, none of them had taken on the responsibility of dealing with these murders. This was because most of these murders happened in traditional communities, where they were not necessarily considered crimes, but rather as fitting punishment for witchcraft. She was concerned about what happened to the children of these women who were murdered by communities. She would like to have the Superintendent, as well as the House of Traditional Leaders, present when the Committee visited the Eastern Cape so that this issue may be discussed with them.

The next stop on the trip would be KwaZulu-Natal (KZN). They would like to have insight on what the conditions of children living in extremely rural areas were like.

If the Committee agreed, the Chairperson would like to invite the Chairperson and CEO of the National Development Agency (NDA), as well as the Gender Commission. This was because neither of these organisations was investigating the murders of suspected witches in communities, and the victims’ families felt neglected by the government.

The Chairperson asked the Committee to have a look at the programme and determine whether or not it ws structured well enough for them to perform the oversight they would like to in all these areas.

Ms L van der Merwe (IFP) asked if there was any representation of non-profit organisations (NPOs) at these meetings. If the Department would be there talking about these issues, it would be useful for the NPOs to be there so that they could let the Department know what their problems were.

The Chairperson responded by saying that this should be highlighted as a concern.

Ms Mogotsi requested the NDA to give a progress report to the Committee about the work they did with NPOs.

The Chairperson agreed. She clarified, however, that the onus of helping citizens should be put on the Department of Social Development (DSD) and not on the NDA, as the NDA merely assisted the Department.

Ms Mogotsi replied that both the Department and the NDA needed to be called for a report back. The Department would give the Committee an overview of the NDA. The NDA would then give the Committee documents as part of the oversight process. They also needed to state how the funds they received from the Department were used.

The Chairperson said that the NDA did need to give the Department a breakdown of how they dealt with the issues they faced, as well as how exactly they supported NPOs. She requested that the rest of the Committee accept the proposal for a meeting on 22 August, where all these bodies would be present.

The Committee agreed.

The Chairperson brought to light that the Minister has requested that the Department and SASSA work on their tasks separately, as there tended to be tension when they worked very closely together.

Ms Mogotsi questioned why the Committee was going back to provinces that they had already visited. She was concerned about neglecting the rest of the provinces.

The Chairperson replied that they would be going back to evaluate the progress that had been made since their last visit. The trip to KZN could be rescheduled, as there was no pressing issue to be sorted out there, other than various crimes not being investigated.

Ms Tsoleli said that governance needed to be equal, and they needed to visit the rest of the provinces with the same purpose that they had when they went to the other provinces. The Committee would look at their mandate, the issues that they needed to provide oversight over, and attend all the conferences where the people voiced their concerns. After all the provinces had been visited, they could then go back to the Eastern Cape to follow up on the progress. She appealed to the Committee that they should visit the rest of the provinces before going back to KZN and the Eastern Cape.

The Chairperson replied that the problems of the North West were yet to be reported, therefore going there now would not necessarily help anyone. It would also disturb the ministries that were currently compiling reports of these problems. If Members felt that they really did want to go, then they may approach the coordinator of these ministries to request permission. She proposed that the visit to the North West be put on hold for now.

Ms Tsoleli replied that women were being murdered in all of the provinces. If the purpose of the visits was to deal with these murders, then the best approach was through the non-government organisations (NGOs) and NPOs that dealt directly with these issues.

The Chairperson replied that correspondence with the Department would determine whether or not they would be going to the rest of the provinces. Any Member was free to request the Department for a list of their projects in order for the Committee to know where they needed to go.

Ms Dudley said that the Western Cape was currently experiencing a “civil war,” and it was important that the Committee dealt directly with this issue. It was important that the Committee dealt with the provinces that were closer and had more pressing issues.

The Chairperson suggested that the issues of the Western Cape could be dealt with, as that was where the Committee was based. The rest of the provinces, however, definitely needed to be visited as some of the victims did not even have access to the NGOs that assist.

Ms Van der Merwe proposed that the provinces that had not yet been visited be prioritised, but the trip back to the Eastern Cape also be considered so that when the term of the Committee ended, they may at least be able to say that they had done justice to all the provinces. The Western Cape issue may be dealt with on a Friday, as that was when all portfolio committee members had time.

The Chairperson raised a concern that splitting the visits may not be doing justice to the importance of the issues they had to deal with.

Ms Tsoleli suggested that the oversight days be reflected on the programme, as they were not on the programme at all.

The Chairperson raised the point that the Committee was running out of time in office, and they therefore needed to get going on the issues they had to deal with as soon as possible.

The programme’s adoption was proposed by Ms Van der Merwe.

Ms Tsoleli seconded.

Ms A Khanyile (DA) raised the point that SAPS needs to be more cooperative when dealing with certain crimes. There was a missing teenage boy in the province of Mpumalanga, and it had been revealed that the police had investigated this case for only one week before leaving the case unsolved. Cooperation of SAPS with victims was therefore crucial.

The Chairperson strongly agreed.

Adoption of minutes

Ms Tsoleli expressed satisfaction with the capturing of the resolutions related to previous problems. She moved the adoption of the minutes of 30 May.

The Chairperson agreed.

Ms Tsoleli suggested that the issues that were on the white paper be included in the resolution, and dealt with as soon as possible.

Ms Mogotsi agreed.

The minutes of 6 June were adopted by the Committee.

Ms Tsoleli noted that the Social Development offices in each province needed to be reporting back on their respective progress.

Ms Abrahams brought attention to a spelling error of one of the delegate’s names. She then proposed adoption of the minutes of 4 July.

The meeting was adjourned.

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