Social Assistance Amendment Bill: briefing; DSD Audit & BRRR action plan; with Deputy Minister

Social Development

13 November 2019
Chairperson: Mr M Gungubele (ANC)
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Meeting Summary

The Deputy Minister encouraged the Committee to process the Social Assistance Amendment Bill as quickly as possible so that it can enable DSD to provide better social security and reach more in the fight against poverty and create security for children that are raised by their own extended families.

She noted that the Amendment Bill is not content-heavy. At the heart of this Amendment Bill is the kinship care grant. It will reduce the burden on the Foster Care Grant system but also reduce the burden on adoption because now people will reach out to look after their own families as they will receive some assistance as they are struggling with their own poverty.

The main objectives of the Amendment Bill are:
• To empower the Minister, with the concurrence of Minister of Finance, to make additional amounts available for social grants
• Implement the extended Child Support Grant policy approved by Cabinet in December 2016
• Regularise the practice of paying additional amounts on the Older Person’s Grant for those over 75
• Removal of the reconsideration provision in the Act
• Facilitate the establishment of an Inspectorate.

Members asked when the Bill will come into effect; how soon it would minimise the Foster Care challenges and reduce the backlog of cases; what reduction in foster care applications did the Department anticipate; what the role and duties for the inspectorate are; by bringing the inspectorate into the Department, is this removing independent checks and balances; and about the assumption that relatives will be non-abusive carers of children within their extended family.

DSD outlined its audit action plan to respond to the Auditor General’s 25 audit findings and qualified audit opinion for 2018/19. DSD provided an action plan to respond to the Committee’s Budgetary Review and Recommendation Report (BRRR) which had given recommendations on governance, expenditure and service delivery.

Meeting report

Opening remarks by Chairperson
The Chairperson reminded Members they had agreed to work differently. If the lack of bringing an Amendment Bill to Parliament in a timely manner is the reason the DSD and Portfolio Committee are in this situation, then the tune must be changed. A new gear must be started, a legislative gear – because one cannot go to the court and apologise when the legislative processes are not in place. It has been advised that while the Children’s Amendment Bill is key with all its 300-and-something clauses, experts have advised that it will take two to four months. If the Social Assistance Amendment Bill which is able to be implemented within a short space of time, is in place, it can resolve many concerns. That is the spirit in which the Committee and DSD will be moving.

Opening Remarks by Deputy Minister
Deputy Minister Hendrietta Bogopane-Zulu said that the DSD is happy to resuscitate the Social Assistance Amendment Bill [first brought to Parliament on 13 April 2018 at the end of the Fifth Parliament] and they are hoping and praying that the Committee will keep it alive within the time frame so that it does not lapse again because if we adjourn in December before the Committee can really interact with it, it will have to be resuscitated again next year. The DSD is present to ask the Committee to assist DSD with processing this Bill and to show that the Amendment Bill is more administrative and technical than content-heavy. If the Bill is passed within the time frame that the Committee will set for itself, the DSD will be in the position to create an environment that will not only enable the DSD to provide better social security, but it will also enable the Department to reach more as they fight poverty and create security for children that are raised by their own extended families.

This is at the heart of this particular Amendment Bill. It is a known fact that when parents die the family takes in the children and they do not appear before any court, the children are never processed through the foster care system, the children are never adopted but they belong to the family. However, the burden of looking after these children is what makes families disintegrate, so in the spirit of strengthening families and providing support for those families that would look after the children as their own, the DSD is bringing forward the top up, in the original Act it was called Kinship Care which are children being looked after by their family members. DSD is asking the Committee to approve this as it will really fight child poverty. It will reduce the burden on the Foster Care Grant system but also reduce the burden on adoption because now people will reach out to look after their own families as they will receive some assistance as they are struggling with their own poverty.

The other two amendments are administrative. The DSD wants to make the inspectorate a directorate and not a department as it was initially drafted. The DSD is requesting the Committee enable this so DSD is able to roll out the inspectorate that will process cases faster, as the Committee needs them to. It is smaller but it will focus on investigation which is what the DSD wants. The DSD wants an entity that will process cases faster and on time, focused on fraud happening in the South African Social Security Agency (SASSA) but also provide quality assurance in systems administration. The last point is the technical amendment of the realignment of the Act itself, in terms of different clauses for administrative implementation purposes to enable the DSD to align the decisions taken.

Social Assistance Amendment Bill: briefing
Ms Brenda Sibeko, DSD Deputy Director-General: Comprehensive Social Security, said that the main objectives of the Amendment Bill are:
• To empower the Minister, with the concurrence of the Minister of Finance, to make additional amounts available for social grants
• Implement the extended Child Support Grant policy approved by Cabinet in December 2016
• Regularise paying additional amounts on the Older Person’s Grant for those over 75
• Removal of the reconsideration provision in the Act
• Facilitate the establishment of an Inspectorate.

• Implement the extended Child Support Grant policy approved by Cabinet in December 2016
Ms Sibeko said the current Act makes provision for all the different grants and specifies the circumstances under which those grants may be given. The Regulations determine the amount that may be given for each grant and the criteria under which those amounts may be given. The gap is that there is a problem with the Foster Child Grant (FCG) system. The Act requires that for SASSA to give a FCG, the child applicant must be able to produce a court order that says which parent is the foster parent. So in the absence of the foster care order, SASSA is not supposed to give a FCG. And in the Children’s Act – the provision there is that all foster child orders must be reviewed every two years. The result of that combination is that whenever a foster parent is in place looking after a child they are subject to a two year review and SASSA is unable to give the FCG in the absence of that review. Given the extreme levels of poverty and the large numbers of orphans in the country, all of them end up clogging the foster child system as they all have to go through the court process to get the court order to access the grant.

The difficulty with that is every two years they come back into the system for the court review and that puts a huge burden on the whole foster child care provision programme. This amendment intends to reduce the burden on the FCG. The reason many people approach the court for the FCG is because it is a larger amount of money than the CSG. The intention of the FCG was only for it to deal with children in need of care. Children in need of care are those who do not have family to look after them. The way we operate in South Africa, is when a family member dies someone else within the family will take in the child of the deceased. Due to their own financial situation it may be difficult for them to support the child which then leads them to apply for a FCG even though they do not want to foster the child as the child is part of their family. The intention is to reduce the burden on the foster care system by offering those who are taking care of children from their own family and giving them additional financial support than the CSG which is a small amount of money intended to support actual parents who may not have the means to look after their own children.

• Regularise paying additional amounts on the Older Person’s Grant for those over 75
The Act does not have an enabling clause to allow the Department to pay an additional amount for older persons above the age of 75. The DSD is doing this primarily because the tax system  gives a slightly higher tax rebate for persons above the age of 75 so DSD wanted to match that with a slightly higher amount for those above 75.

• Removal of the reconsideration provision in the Act
The Department has an appeals tribunal which is responsible for appeals against SASSA’s decisions. Any time someone applies for a grant and SASSA does not give them the grant and they want to complain, the present requirement is that they must go to SASSA and ask SASSA to reconsider their original decision and the legislation makes provision that this should be done in three months. If SASSA continues to say they still will not give the grant after the three month period, then the complainant has the right to approach the appeals tribunal. The appeals tribunal has another three months in which to consider the appeal and make a ruling on it. The effect of this is that anyone who is unhappy with a SASSA decision has a period of 180 days for their problem to be resolved because of those two processes. What DSD has found is that it is not necessary. The extent to which SASSA’s decisions are reviewed by the tribunal are very minimal. Currently there is 98% coalition between SASSA’s reconsideration process and the Department’s tribunal process so the only thing it does is to delay the process for the appellants. In that sense, DSD is recommending that the reconsideration requirements based at SASSA should be removed so that anyone who is unhappy with a SASSA decisions can go directly to the appeals tribunal which will shorten the appeal to a three-month period instead of 180 days.

• Facilitate the establishment of an Inspectorate.
DSD wants to facilitate the establishment of the Inspectorate. At the inception of the Social Assistance Act an inspectorate was envisaged but that inspectorate did not get implemented. The Act provides for the inspectorate to be a department and in terms of its functioning. It does not have policy making functions, it primarily has to do with fraud investigations and dealing with complaints and audits SASSA activities. These functions do not require a big departmental structure and DSD is therefore proposing that it should rather be a directorate or component within DSD, rather than a department.

Discussion
Ms B Masango (DA) thanked the DSD for the clear and straightforward presentation. The introduction mentioned that this is an intervention for the FCG backlog. How does it help politicians to explain the situation as there is still the court deadline of 28 November.

Ms D Ngwenya (EFF) asked what the terms of reference are and who compiles the terms of reference for the inspectorate as there is a need to understand its role and duties. She asked DSD to elaborate on the statement that the inspectorate is an investigative arm. Does the DSD know when exactly the Bill will come into effect and how soon it will be able to help in minimising the FCG challenges. Can a number be put on the reduction of cases due to this Bill

Ms A Abrahams (DA) said as the FCG is R1000 and the CSG is R400, people who are desperate are going to be more inclined to apply for the FCG instead of the CSG. What will SASSA put in place to restrict people from applying for the FCG and prevent them from clogging the system? We need to be careful when generalising that all families will take in the children of relatives, because some people can be cruel. They can be even crueller when they are desperate and hungry and in the end the child suffers. By bringing the inspectorate into the Department, this is removing certain checks and balance by not keeping it separate. With all the existing capacity and management problems, to incorporate another body into the department may just create more problems. She noted the two appeal processes will become one with the tribunal incorporated into the department. Will people be losing their jobs or are those same people going to be pulled into the department. Is there budget for it since there is a capacity problem?

Deputy Minister & DSD response
Deputy Minister Bogopane-Zulu replied that when the Social Assistance Act was drafted, it was always made very clear that the inspectorate will be independent; so even with this amendment, it does not take away the independence. What is being corrected is just the word "department" to "directorate" which simply indicates that it will not be a department with a Director General and stand on its own – but it remains an independent investigative entity. The powers and functions are in Chapter 4 of the Social Assistance Act. It is already there in the Act and that section is not being amended at all so the institution remains intact. The only thing DSD is doing is to ensure it is able to function. What the DSD at the time called a Kinship care grant is the grant between the CSG and FCG estimated to be about R650 when it was presented to Cabinet and the Cabinet approved it at that level. The Kinship care grant is intended for grandparents who inherit their grandchildren. So the principles of what this constitutes means the chances of it being abused are very narrow as it is already defined. What was outstanding was the actual activation and implementation. It was called Kinship Care as it is precisely meant for families. There must be blood relation with the child, whereas foster care is any child from anywhere, so there is a clear difference. We note the matter of children being abused and DSD is very conscious of that because even with cases where there are pensions the parents worked for, children still get abused. While being very conscious about abuse, the DSD wants to assist families that want to keep their own blood relative but are struggling.

The Deputy Minister replied that DSD and SASSA will not be able to put a number to the reduction in foster care cases. At the moment, because the FCG is higher, people will take in the children in their families just so they can get some assistance from the state. With the Kinship care grant they will get assistance without a social work report and without infringement. Therefore DSD will only know the impact once it is implemented. It is hoping that the number of children waiting to go to court for foster care will be reduced.

The Deputy Minister replied that DSD does not look forward to not meeting court deadlines. It will stay alert to the court deadline and continue working to meet the deadline. This amendment provision will be part of the SASSA administration permanently. The court order DSD is sitting with will not necessarily be affected in any way. The Bill is futuristic. The Committee passing the Bill depends on how quickly the Bill is processed. She noted that these are technical amendments and the Bill is amending a principal Act. As soon as the National Assembly and NCOP passes the Bill, it will come into effect 30 days thereafter as it does not require a Presidential proclamation. All it requires are concurrent functions between Social Development and Treasury.

Ms Sibeko replied that the current way in which the tribunal operates is that it has a panel of doctors and a panel of lawyers who deal with appeals as and when they occur. The Department acts only as an administrative support to the tribunal. The tribunal itself is made up of independent people who hear the challenges so the case load for them is expected to increase slightly.  However, a much larger number of tribunal members was appointed than the DSD has had before, in anticipation that there are going to be more appeals now that they come directly to DSD and not to SASSA. The DSD is ready for this as they already have the funding and a much bigger tribunal to deal with all the cases. There will not be any job losses. The admin system is in the department but the tribunal is independent and people will get called as and when there are appeals to hear.

The Chairperson requested that what Ms Sibeko has explained should put in writing in a narrative as it improves the intelligibility of the process and makes the Committee interact very effectively.

Ms Masango agreed with the Chairperson about requesting a narrative report.

The Deputy Minister accepted the request and said that they will provide a narrative report.

DSD Action Plan in response to 2018/19 Audit Findings
The Deputy Minister said the Minister and herself wished to sincerely apologise to the Committee for the poor quality of the content brought to the Committee last week. The Department hopes that the apologies are accepted and promise to strive to do better. The DSD will present the Audit Action Plan for dealing with the issues raised by the Auditor General. DSD will be in a better position than they were last week to provide the requisite information on the plan of action put in place by the Acting DG and his team. The DSD has found that its challenge is sometimes putting it down on paper but they are actually implementing what needs to be implemented. DSD hopes that this time round they will be getting it right. The Deputy Minister handed over to the Acting DG.

Mr Mzolisi Toni, DSD Acting DG, explained DSD received a qualified audit opinion with findings on its 2018/19 annual financial statements. He outlined the audit action plan to respond to findings on:
- Accuracy of social assistance payments
- Accuracy of social assistance grants
- Assets (minor and major)
- Expenditure management
- Procurement and Contract management
- Review of policies in line with changes in regulations
- Supply chain and contract management
- Payments made without certification
- Non-compliance with National Treasury instruction notes
- Deviation not consistent with National Treasury approval and Treasury Regulations
- Consequence management: Limitation finding
- Consequence management: Recovery not requested within 30 days
- Inventory management
- Inconsistency between fixed asset register and financial statements
- Repayments and advances
- ICT governance
- Human resource management
- Non-compliance with IIA Standard 1312 - Internal Audit
- High vacancy rate – Directorate: Internal audit services

DSD Action Plan in response to BRRR
Mr Toni outlined the DSD action plan in response to the Committee’s Budgetary Review and Recommendation Report. It addressed recommendations on service delivery, expenditure and
governance (see document).

Discussion
The Chairperson said that this briefing was a huge improvement but time frames are needed across the board as there are no time frames at all. If one looks at the fight that the Committee has put up, it has produced useful documents for further oversight. When they go to Free State or Tshwane they will have these documents and will know what to look for because it is clear as the area, intention and manner of intervention is articulated, except DSD will not have time frames which are essential. Times frames must be added as soon as possible.

Ms Masango thanked the DSD and said that the clearer the presentation is, the more worrisome the picture. This is because the root cause has eight bullet points and all of them point to management not doing their jobs. It makes one wonder what management was actually doing. The moratorium did not reach management and management was not doing anything. Where the moratorium was applied the root cause is that there were no people doing the work. It leads one to wonder that the people who were there, were they ever going to do what they were supposed to be doing? This is such a scary picture

Ms Ngwenya agreed that it is very scary but at least there are action plans in place so time should be given to see what happens. There is an interest in all the cases taken to human resources. There is hope that the Committee will soon get the verdict and the sanctions for those cases finally.  

In his closing remarks, the Chairperson said that the more intelligible the reports are, the more effective the oversight is going to be and the more the Department will benefit. If honest information is not given, the Committee will not critique and when there is no critique, the Department will get comfortable. The Committee is very grateful for the evolving positive cooperation with DSD.

The Deputy Minister replied that DSD will send the narrative reports and add time frames.

The meeting adjourned.

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