The Portfolio Committee met with officials from the Auditor-General of South Africa (AGSA), the Department of Social Development and its entities -- the South African Social Security Agency (SASSA) and the National Development Agency (NDA) -- on a virtual platform. The purpose of the meeting was for the Committee to use the AG's audit findings to scrutinise and deliberate on the annual performance plans of the Department and the entities.
In their interaction with the AGSA, Committee Members expressed their disappointment at the DSD's lack of consequence management. There was an impression that officials did things which undermined the state, and were getting away with impunity. They were equally frustrated at the high vacancy rate in the Department and its entities and sought explanations. Among other issues, they wanted details of 83 contracts referred to in the presentation, what the Department was doing about officials without proper qualifications, the material loss caused by making payments to non-existent individuals in the absence of a vetting system, the fate of field workers affected by the closing of post offices, as well as the basis for the disagreement between the AG and the accounting authority.
In the interaction with the Department, Members expressed concern at its lack of action in implementing the recommendations contained in the AG’s report, which was why the same issues were being flagged year after year. Among other issues, they enquired about the implementation of the basic income grant, the annual reports of non-profit organisations, the employment of social workers, the amendment of legislation to enable the continuation of the R350 grant, youth development programmes, the R1.5 billion top-up for the Child Support Grant, the DSD's mechanisms to assess its performance and work, and migration issues at the local government level. Other concerns were the prolonged periods of the Department’s outstanding investigations, its uncompleted projects in the procurement chain, the falsifying of SASSA cards, the poor service at many SASSA offices, as well as the high vacancy rates in the Department and its entities that were severely undermining performance across the board. Members stressed the importance of having a robust database to verify applicants’ information so that only eligible individuals could receive the R350 SASSA Social Relief of Distress grant.
During the discussion with SASSA, Members asked why it did not include children under the age of one as recipients of the Child Support Grant and complained about the onerous procedure to register newborn infants for the grant. They enquired about the operation of SASSA’s record management centres, the reduced number of cash pay points, the lack of state doctors for disability grant approvals in George, skills development programmes for grant recipients, control measures to effectively monitor the grant funding dedicated to the KZN floods, the number of eligible individuals who had not received their grants, the process of amending legislation to allow for the continuation of the R350 grant, as well as fraud and incorrect grant payments made to ineligible individuals.
Members expressed concern over SASSA’s poor customer service, the long processing time for grant appeals and the lack of ablution facilities at some of its paypoints, and stressed the importance of providing viable alternative solutions in areas where post offices were about to close.
The Committee’s last engagement was with the NDA, where questions were raised about the appointment process for the Agency's new board.
The Minister concluded the proceedings by giving an assurance that the DSD was committed to ensuring that all disaster-related resources would be spent for their designated purposes
Briefing by Auditor-General of South Africa
Mr Faizel Jogee, Senior Manager, Auditor-General of South Africa (AGSA), provided the Committee with its audit reports on the Department of Social Development (DSD), and its entity, the South African Social Security Agency (SASSA).
The status of records review for the Department was provided to the Committee.
The Office of the Auditor-General flagged several areas that it found concerning in the Department’s performance. Those areas included financial management, performance management, procurement and contract management, compliance management, human resources, information technology (IT) management, and the entity’s financial health. Some of the highlighted issues included the R350 grant payments being made to ineligible individuals, failure to institute consequence management measures against employees responsible for irregular and fruitless and wasteful expenditure, and a high vacancy rate, including that of the Director-General.
The status of records review at SASSA was provided to the Committee. With the same focus areas, the AG’s office also found the oversight and monitoring aspect of SASSA concerning. Only 49% of the planned initiatives had been implemented as at 30 October 2021. This created a risk that those findings may recur in the current financial year if the necessary preventative controls were not implemented. Among other concerning issues, there was a high vacancy rate among senior posts, and recurring fruitless and wasteful expenditures were common themes.
A material irregularity report was presented to Members. This included the payment of social assistance fees for services not rendered, the R350 grant paid to ineligible applicants as well as the overpayment of R316 million to a service provider.
The Office concluded the briefing with a recommendation report, as well as a preventative control guide to the Committee.
Ms L Arries (EFF) said that it was worrisome for the Committee to note the lack of consequence management in the DSD, and demanded that the Department institute action plans adhering to the recommendations of the AG. For instance, she wanted to know what consequence management measures had been instituted against those who were responsible for the asset register as well as those who had incurred the irregular, fruitless and wasteful expenditure amounting to R100 million at the National Development Agency (NDA).
She called for a time frame for an update of the Department’s asset register and stressed the importance of updating the register on a more regular basis. She was frustrated at the high vacancy on the NDA board, which had led to its dysfunctionality. She sought clarity on the 83 contracts shown in the presentation, wanting to know what those contracts were for. Were they for builders, car rentals, or service providers?
She urged the DSD to fill vacancies in crucial positions. She did not understand that some officials had been under investigation since 2011, and why those vacant positions still could not be filled.
She asked for more details about the three million grant applicants whose financial information still had not been verified by SASSA. The regular fraud cases happening within the realm of SASSA were indicators of the flaws in its system.
What vetting had been in place prior to the appointment of those officials who now had been exposed as having no relevant qualification?
Ms A Abrahams (DA) requested that the guidelines be re-circulated among Committee Members.
She asked the AG to name the service providers indicated on its slides 26 and 27.
Ms Abrahams recalled that there had been three pages of preventative controls presented by the AG in the meeting on 30 September 2020, but noted that those three pages had been reduced to only one page in the current presentation. She wanted to know if that meant that the other two pages of preventative measures had been put in place by the Department. She asked the AG if its office kept a dashboard on the progress of the DSD's implementation of those preventative controls so far. If there was, she requested to see the dashboard.
She enquired about the performance agreements for officials, and whether performance agreements were also extended to senior staff members in the Department’s entities.
Commenting on the high vacancy rate in the DSD, she said that this issue had been going on in both the Department and its entities for years. The DSD currently had an Acting Deputy Director in Welfare Services, an Acting Director-General, an Acting Chief Financial Officer, and an Acting Deputy Director for Strategies and Transformation. She wanted the AG’s office to tell her what more the Committee could do so that the Department could fill its vacancies, as it always attributed its high vacancy rate to the moratorium and COVID-19.
She wanted the AG’s Office to give her an assessment of the performance of the Department of Social Development compared to other government departments in the social cluster.
Mr D Stock (ANC) asked the AG to explain the probable causes for the lack of consequence management in the Department. He was certain that there were material losses incurred by ineligible individuals taking advantage of the lack of control systems at SASSA. What was the disagreement between the AG and the accounting authority on this issue?
Ms J Manganye (ANC) asked the AG to comment on the statement that “some performance indicator targets did not reflect performance in reality.”
Ms G Opperman (DA) read out Ms B Masango’s (DA) question, as she could not log herself online. Ms Masango asked when the Department’s Director-General would be appointed permanently.
Ms Opperman noted that some Departmental officials did not have valid qualifications, and asked the AG what processes the Department had adopted to address the issue.
She wanted to know why the National Development Agency had still not completed its turnaround strategy.
Ms P Marais (EFF) commented on the closing of post offices and the plight of those affected field workers who were never appointed permanently but had been working in those offices for more than ten years. She asked the AG’s view on that because no one was taking responsibility for what was happening.
Which officials would be responsible for the failure to identify who the real recipients of the R350 COVID-19 social relief grant were?
She commented that many issues included in the presentation had been repeatedly mentioned by the AG year after year, but still there was nothing that got done about them.
Ms A Motaung (ANC) enquired about the material losses incurred through payments that were made to invisible individuals due to the lack of checking and verification measures in the Department. She also asked what the basis of the disagreement was between the AG and the accounting authority.
The Chairperson noted Members’ questions and remarked that some of them should be directed to the Department.
Mr Lourens van Vuuren, Business Executive, AGSA, explained that although some questions were very important, those such as the high vacancy rates in the Department and its entities should be directed to the Minister since the Minister was responsible for making appointments.
Commenting on the R350 grant issue, he confirmed that his office had indeed picked up instances where many ineligible individuals had been registered and been paid the R350 grant. He recommended that SASSA should implement internal processes and controls in order to identify and filter out the ineligible applicants because once the money was paid, it became very difficult to recover.
He explained that the disagreement between his office and the accounting authority emanated from the difference in their views of identifying eligible individuals for grant payments. The Department and SASSA’s management had implemented internal control processes to identify and filter out unqualified individuals. However, his office believed that SASSA was relying on old databases. Given the challenging environment, AGSA believed that SASSA should get as many databases from government as possible, as well as collaborate with banks to utilise their systems in order to pick up any irregular cash flow into the bank accounts of those ineligible individuals. The AGSA felt that SASSA should recover that debt.
Mr Jogee concurred with his colleague’s view that the AGSA was just as concerned with the Department’s slow progress in implementing action plans as Members were.
He confirmed that his office did do follow-ups on the action plans. He also reminded Members that the DSD and its entities did their own internal audits in the beginning stages. He recommended that Members should ask the Department and its entities for more details.
He said that the majority of the 83 contracts were rental property leases for the Department’s entities.
The Department and its entities were in a better place to respond to the question of the human resources (HR) officials with no qualifications.
The AGSA's Preventative Control Guideline which it had presented in August 2021 could be submitted to the Committee.
Mr Jogee affirmed Members’ concern that many important preventative measures had not been fully implemented, which had led to ineligible applicants being paid the R350 grant. The material loss, as of August 2021, had amounted to R230 million. The loss incurred during the period of August 2021 to March 2022 still needed to be determined. Some of the loss had been recovered.
He responded to the comment around the social cluster and said that at the moment the AG’s Office was not comparing the performance of the DSD with that of other social clusters. However, the Office worked closely with the auditors of the South African Post Office (SAPO) to analyse issues that regularly occurred with grant payments, as well as their negative impact on grants. He agreed that this input was valuable and would be something which the Office would consider in its new strategic plan.
Mr Jogee clarified that although SASSA did verify applicants’ information against its own databases, the way SASSA did the verification was not up to what the AG believed the process should be. For instance, when databases were received by SASSA two months later for grant applicants’ details whose payments had been made in February, SASSA usually did not run the test, whereas the AG was of the view that it should still run the test in April for those databases that it had received late.
He commented on the question on the link between performance indicators and the reality on the ground. He clarified that the AG reviewed only the details that had been reported, as well as checking whether the numbers were accurate and correct. However, it did not go into much detail in evaluating whether the performance indicators were directly correlated to what was happening on the ground.
On the Post Office issue, he explained that the AG’s auditing focus was on the financial statement. It was through the auditing of the financial statement that the AG had noted this concern and flagged that payments had been made to ineligible individuals, and had asked the post office what measures were in place to prevent this from happening. The AG’s Office had also enquired about the post office’s processes for recovering the money that had been paid to ineligible individuals by error. The AG was working with SAPO's auditors to address this issue. He added that there were service level agreements (SLAs) between SASSA and SAPO pertaining to certain preventative provisions to specifically deal with overpayment issues at pay points. The Department also had a responsibility to oversee and ensure that no payment was being made to ineligible individuals.
Mr Van Vuuren added to the AGSA's response on the technical indicators and targets and highlighted that those indicators should be linked to the mandates of the entity. It was important to ensure alignment between the performance indicators and the legal mandates of the entity. The Committee should be involved in that process because they had to satisfy themselves with those targets for their oversight work. He affirmed that it was within the Committee’s prerogative to request the adjustment of targets should Members find them unsatisfactory.
Ms M Sukers (ACDP) sought clarity on the databases to which the AG was referring. She also wanted to know how those databases were procured.
Mr Van Vuuren said that currently, SASSA’s focus with SAPO was more on the implementation of the existing SLA. Although the Office agreed with Members that the closing of post offices in certain areas would affect some communities, SASSA generally did not focus on that unless the closure would result in a breach of the SLA, and SASSA would then impose a penalty.
He said that the database regulations had come in at the beginning of COVID-19. SASSA had a provision which allowed it to get access to the data in the government arena. Having access to such databases could assist SASSA in identifying unqualified individuals. Ideally, the AG believed that SASSA should obtain as many databases as possible. In the beginning, SASSA had obtained only a few databases, and AGSA had then flagged its dissatisfaction. He highlighted that this process should be a continuous process until SASSA could have another more effective and efficient control method. In the absence of that, he highlighted the importance for SASSA to contact all government institutions and verify all applicants’ information.
Mr Van Vuuren said that the databases consisted of those obtained from the National Student Financial Aid Scheme (NSFAS), the South African Revenue Service (SARS), the Unemployment Insurance Fund (UIF), and payroll information from various governmental departments across all three spheres, pension funds, etc. The objective was to verify whether someone was unduly benefiting from the R350 relief fund. He stressed that the databases were not 100 percent accurate, and urged SASSA to look at other control measures, such as partnering with banks to look at cash flows in applicants’ bank accounts.
The Office of the Auditor-General was excused.
DSD's strategic plan, annual performance plan and budget 2022/23
Mr Linton Mchunu, Acting Director-General, DSD, suggested that the Committee should start with the presentation of the Department before it moved on to SASSA and the National Development Agency.
Minister’s opening remarks
Ms Lindiwe Zulu, Minister of Social Development, offered an apology for her poor network connection, as she was in KwaZulu-Natal (KZN), assisting in the flood area. The Deputy Minister was also in KZN visiting areas that were terribly affected by the disaster. She herself was about to attend a memorial service for those who had lost their lives.
She had listened to the AG's report and had noted the concerns of Members and the Chairperson.
She wanted to use the platform to send a message of support and condolences to those people who were affected in KZN and the Eastern Cape, as well as those in the Western Cape who had been affected by the fire in the informal settlements. In all those instances, she guaranteed that the Department would do all in its power to assist those affected. The DSD understood the importance of peoples’ livelihoods. As the President had declared the flood a national disaster, it would be able to free up more resources and direct them to areas where assistance was needed.
While poverty and unemployment were pervasive in South African society, the series of shocks and disasters, from COVID-19 to the July unrest, and now the flood, were testing the government’s readiness to respond to people’s call for help. Although those disasters were damaging, they were also learning lessons for government to develop and build capable, resilient and innovative future institutions.
Minister Zulu anticipated that all the tabled annual reports and their five-year strategic plans would be fruitful. Given the time constraint, she believed that it might be a bit challenging for Committee Members to receive so much information all at once.
She highlighted the mandatory objective of the Department, which was to improve the lives of people by coordinating various social protection imperatives which were also outlined in the National Development Plan. Therefore, the performance of the DSD and its entities ought to be measured by human-level outcomes, as well as its wider impact on communities and society. Those APPs demonstrated that people’s vulnerability was being addressed, and were the embodiments of people’s dignity, development and prosperity.
She pointed out that the APPs marked the mid-point of the sixth administration. She and her deputy have made it clear to the Department and its entities that their expectations of them would be higher this year. They had demanded to see positive outcomes from those various programmes and to see their operational plans being translated into reality. The design of the APPs factored in inputs from the State of the Nation Address, the Minister’s performance agreement with the President, the Economic Reconstruction and Recovery Plan, and the Budgetary Review and Recommendation Report.
She indicated that her Department was learning to innovate programmes across the government sphere through the District Development Model (DDM). She acknowledged that the DDM service implementation approach was people-centred and encouraged community responsiveness and active citizenship, as evidenced by the recent disaster in KZN.
She welcomed the Committee’s oversight role of scrutinising the Department’s work and fully understood the important value of this role.
The Department was committed to stimulating resource modelling and the implementation of the basic income grant. It anticipated that there would be an increase in the demand for SASSA services, and the entity would continue to pay to people who could not support themselves and their dependents in 2022/23. That population would amount to 18.9 million by March 2023.
Minister Zulu guaranteed that SASSA would continue to improve its verification system to ensure that ineligible individuals would not be paid the grant. She indicated that the R350 social relief of distress grant would continue to be provided.
The National Development Agency had also come up with ways of ensuring that people were being empowered through its social entrepreneurship programme.
DSD's annual performance plan
Mr Mchunu expressed his satisfaction at the Department’s annual performance plan (APP), informing the Committee that the DSD had come sixth out of 14 in terms of the quality of its draft annual report in government. He was confident that the quality of the report would be in the top three after revision.
He explained how the Department’s APP was aligned to the Presidential SONA 2022 and the Economic Reconstruction and Recovery Plan. The APP was not only closely aligned to all those government and sectoral priorities, but also showed engagements with other stakeholders such as the Department of Planning, Monitoring and Evaluation, the Department of Women, Children and Persons with Disabilities, the National Treasury and AGSA. The Department had submitted all the engagement reports.
The Department’s APP included five programmes -- administration, social assistance, comprehensive social security, welfare services policy development and implementation support, and social policy and integrated service delivery.
He said that R248 billion, R212 billion and R224 billion would be allocated for social grants for eligible individuals in 2022/23, 2023/24 and 2024/25 financial years respectively. Details of other programmes in the Department’s APP could be found in the presentation slides.
During the current 2022/23 financial year, the Department received a baseline budget of R214 billion. It was anticipated that the budget would be increased to R215 billion and R225 billion in the 2023/24 and 2024/25 financial years respectively.
On social assistance grants, the Department clarified that:
- An amount of R44.0 billion had been additionally allocated for the extension of the Special COVID-19 Social Relief of Distress Grant for one year covering 10.5 million eligible persons;
- Amounts of R5.5 billion would be allocated in 2023/24 and R7.6 billion in 2024/25 for inflationary increases to social grants; and
- R687 million in 2023/24 and R871 million in 2024/25 would be allocated for the extended/ top-up child support grant for double orphans in the care of relatives.
A summary of the Department’s budget allocation for each of the five programmes was outlined.
Ms Abrahams proposed engaging the Department before the Committee moved to receive SASSA’s briefing. The Chairperson agreed with the proposal and opened the floor to Members.
Ms Arries enquired about slide 24 of the presentation, which stated that the population between the ages of 18 to 59 would receive a basic income grant, and that would be a draft policy in 2024/25. She sought clarity on whether it meant that the basic income grant would be an approved policy only until the 2024/25 financial year. She further sought clarity on whether this had the implication that the R350 social relief of distress (SRD) grant would remain in force until that legislation for basic income support was in place.
She asked the Department how many NPOs’ annual reports it had received in this financial year. She wanted to know how possible it would be for the Department to process 80% of the NPOs’ annual reports within two months.
She reminded the Department of the high number of unemployed social workers, as well as those that had taken to the streets in protest in KZN. She therefore wanted to know what the Department’s plan was to employ more social workers in this financial year.
In which three provinces was the Department locating its piloting sites for electronic monitoring?
Ms Arries wanted to know about the 170 social workers which the Department had indicated it would provide training for in its adoption policy framework. She asked whether those social workers were social workers currently in the employ of the DSD, or if they were new additions.
How did the DSD plan to continue to roll out the R350 SRD grant, given that there was no provision for the grant in the Social Assistance Act?
How many young people had benefited from the Youth Participation skills development programme?
Mr Stock questioned the Department on its inability to finalise investigations into its own fruitless and wasteful expenditure cases and wanted to know what the cause of the delay was. He asked the Department whether those implicated employees were still in the employ of the Department and if any disciplinary action had been taken against them. He highlighted the risk of having such officials on the Department’s payroll.
When did the Department plan to fill the position of Director-General with a permanent employee?
Ms Abrahams expressed her disappointment that little emphasis had been given to the R1.5 billion that was needed for the top-up child support grant. Given that the government had often been accused of neglecting children, she found it unfair and unacceptable that the government could find R44 billion for the R350 grant but still provided no clarity on the R1.5 billion for children.
She asked the Department to confirm whether the decrease in the compensation of employees (COE) over the next few years was a direct contributory factor to the Department’s struggle to fill its 60 vacant posts. If those positions were not filled, would the National Treasury reduce the Department’s budget further for failing to fill the vacancies?
Ms Abrahams commented that Members needed to see a more detailed report than the presentation. The presentation slides did not adequately explain the "how question," and it was the how question that could assist Members to understand the Department’s implementation plan and operational processes. For instance, slide 29 mentioned the DSD's monitoring tools and guidelines without providing much detail on what those monitoring tools and guidelines were. It was the same with the maternal support policy shown on slide 31, as well as the anti-gang strategy on slide 30. She asked whether new Child and Youth Care Centres (CYCC) had been established. She emphasised that there was a lack of detail in the presentation.
She sought clarity from the Acting CFO on slide 42, where she noted that there was a decrease in the number of households and transfer subsidies. She wanted the CFO to give her an explanation for the decrease.
Ms N Bilankulu (ANC) questioned whether the turnaround period for policy development approval and implementation, which usually took about two years, was not too long.
She asked the Department how it assessed its policy outcomes for the various frameworks and guidelines it had designed. She wanted the Department to provide Members with more measurable outcomes.
Which of the Department’s programmes addressed the SONA commitments which aimed to provide people with work and link them to opportunities? Were there integrated outcomes from such programmes?
Ms Bilankulu asked the Department how it was working with other social partners such as organised labour, the private sector and civil society, to migrate beneficiaries to developmental opportunities. She wanted to know about the Department’s plan for training municipalities on migration issues. She noted that many rural municipalities were burdened with squatter camps. Furthermore, there were people coming from outside the country and impregnating women in South Africa and returning to their countries of origin, despite having had a record of doing that in their own countries. Those pregnancies were increasing the burden on the social welfare system, and she asked whether the Department was regulating these matters.
She commented that although the DSD's COE budget was decreasing, there were district and local offices where people were being paid despite the fact that they had passed on, and it usually took the Department on average about three to four years before a replacement could be appointed. She expressed confusion and frustration as to why it was so difficult to find replacements, and why the Department was not closely monitoring the ghost payments made to deceased people’s bank accounts.
Ms Sukers reiterated her colleagues’ view that the same issues were being repeated year after year. She wanted to know what had been done to address such chronic dysfunction in the Department and its entities.
Had the Department’s database information been checked and updated? Did the Department have a master data system to ensure that there was accurate and quality information to verify against?
She highlighted the importance of consequence management and noted that the Department had outstanding investigations that had not been completed. She asked what the Department was doing, and recalled that there had also been outstanding investigation cases the last time they met with the Committee. She asked the Department to give an indication of the average time it took to finalise those cases.
Ms Sukers sought clarity on how the Department was translating its key performance indicators across the board to ensure that those issues that had been highlighted were incorporated into the tangible line functions of the Department and its entities.
What was the status of the post office’s compliance with the SLAs, and had any penalties been incurred?
She expressed concern over the Department’s procurement contract management since the presentation showed that only a small percentage of its procured work had been completed, and most were still outstanding. Why were those projects still not completed, as those uncompleted projects could be costly to the Department?
What was the Department doing to combat the illegal falsifying of the SASSA grant card?
Ms Sukers recalled that the DSD had made a submission to the Committee for an IT system that the Department had at that time planned to purchase at a cost of millions. That item had been in the Department’s APP for the 2019/20 financial year. At the time, the Department was confident that this system would ensure correct payments were made to the correct recipients. Now, given the huge number of wrong payments made to ineligible recipients, she questioned how inter-connected the Department’s and SASSA’s systems were. Furthermore, she wanted an indication from the DSD on what it was doing to ensure that the money was being provided to the right recipients, as well as how much had been spent on that IT system.
Ms Marais asked the Department what its plans were to ensure that the performance indicators in the APPs of the Department and SASSA were being implemented. From her own experience and oversight visits, she had found that SASSA employees were very rude to grant recipients. She had also never seen any DSD officials or SASSA senior managers doing their oversight work on the ground.
Ms Manganye remarked that those same issues which the AG had flagged had been there for years, and lamented that no progress had been made. She expressed her dissatisfaction at the lack of progress.
She noted the high number of vacancies in senior positions in the Department and expressed doubt on how it planned to meet the target of employing the 55 000 social workers contained in the National Development Plan 2030.
Mr Mchunu confirmed that the Department had drafted regulations to ensure the continuity of the R350 SRD grant. What the Department required now was the amendment of the current legislation to assist in that regard.
Mr Peter Netshipale, Deputy Director-General, explained that the Non-profit Organisations (NPOs) Act required all NPOs to submit their annual and financial reports to the Department. Since there were different ends of financial years for different NPOs, their reports were also submitted at different times. According to the Act, the Department was mandated to look at those reports submitted by the NPOs. When those reports satisfied the Department’s scrutiny, it would issue a compliance letter to that NPO. The DSD was committed to making sure that at least 80% of those submitted reports were scrutinised quarterly. It was a huge task since there were over 250 000 NPOs in the country.
He said the national Department annually trains approximately 600 youths on one programme by engaging with various government departments, small businesses, the agricultural sector, etc, to provide those youths with platforms to learn and be trained. In addition, it was also responsible for the monitoring of youth development projects in all nine provinces. The purpose was to mobilise youth and then provide them with skills so that they could become employable. He commented that the youths benefited immensely from those programmes.
The Department responded that there were three piloting sites which the DSD had chosen. It was currently consulting those provinces and finalising its own analysis report. It would be making a presentation on the issue in due course in May.
Mr Khumbula Ndaba, Acting Deputy Director-General, said the employment of social workers was an ongoing process. The Department planned to make the employment a joint bid, including sectors and other governmental departments. The aim was to come up with an agreement by June or July. Currently, there was no budget for the employment of social workers. In the meantime, the DSD had engaged various departments as well as provinces with regard to those who had contracted before 31 March 2022. An agreement had been reached with the provinces that they should look at the possibility of extending those contracts until the matter is finalised.
Ms Isabella Sekwana, Acting Deputy Director-General, explained that all identified social workers must have a minimum of three years of experience. It was part of the minimum requirement in the adopted framework.
Mr Fanie Esterhuizen, Chief Financial Officer, informed the Committee that there was only one outstanding case of fruitless, wasteful, irregular expenditure involving R1.5 million that had not been resolved. The reason was that no proper procurement process had been followed between the Department of Justice and the Department of Social Development. The DSD was still waiting for feedback from the Department of Justice.
He said that in the 2021 financial year, there was one case under investigation which was related to the Department’s procurement of a Wendy House in the Eastern Cape region for one of the centres. The amount was about R390 000. The Department was considering turning it around and using the house so that this wasteful expenditure item could be taken out of its financial statement.
The decrease under household items of the Department’s financial statement was because of the dropping of the R44 billion SRD grant. As the President had lifted the state of disaster on COVID, the payment of that fund would not continue, and this would result in a decrease.
Mr Esterhuizen said the Department currently had cases involving officials facing allegations of wrongdoing. It had referred them to legal services for opinions, as most of the officials who were caught claimed that they had done those things in the interests of the state. He clarified that the DSD was not in a position to make a decision, as the matter was between the Department’s HR unit and organised labour.
Mr Mchunu commented that in some instances it was not about the dismissal of employees, but rather recovering a loss that would incur fruitless and wasteful expenditure in the Department’s financial statements.
Ms Siza Magangoe, Chief Director: Families, DSD, described the Department’s anti-gangsterism initiative which it had started in the 2020/21 financial year. It had focused on rolling out 31 CYCC secure care centres countrywide. After that year, its monitoring report indicated that instances of violent crimes had reduced drastically. It therefore took a decision that from the 2022/23 financial year; this initiative would be carried on outside of those facilities. It was targeting nine districts with high gangsterism in the country, which included Metro North in the Western Cape, Johannesburg metro in Gauteng, eThekwini South in KZN, Dr Kenneth Kaunda District in the North West, Frances Baard municipality in the Northern Cape, Xhariep District Municipality in the Free State, Gert Sibande Municipality in Mpumalanga and Vhembe District Municipality in Limpopo.
She responded to the question about the University of Cape Town (UCT) treatment centre and said that this initiative had started in the 2021/22 financial year and had targeted to open seven centres. That process had been completed, and the Department aimed to open another seven centres this year, making it 14 in total. So far 95 health professionals, including social workers, nurses and psychologists, had been recruited for those centres.
Mr Mchunu said the vacancy issue was a moving target, as people came and went, and there was no way of forcing someone to stay. However, there were a number of posts that were in the recruitment pipeline at the moment. He clarified that the decrease in the COE was not the reason that the Department could not fill all of its vacant posts. In 2021, National Treasury had decided to cut COE budgets across all government spheres and departments, and the DSD also had to find funds for the R235 million budget required for the R350 SRD grant funding in the second quarter. This meant that the Department could not fill all the posts in the medium term, so it was now prioritising the filling of certain crucial positions. He reminded Members that the Department had not been consulted when the National Treasury had decided on the sudden budget cut.
He said Members could find answers to the "how question" in the Department’s more detailed annual report and operational plan, but could not go into details in the meeting because of time constraints. However, he gave an example to illustrate how the DSD did its work in real situations. For instance, for child support, the Department provided community-based intervention services through its community care drop-in centres that were staffed with child and youth care workers. There was a package of services being provided at those centres, such as child protection, HIV and AIDS support, economic strengthening, food, nutrition and psycho-social support, as well as health promotion. In terms of monitoring, the Department reviews the performance indicators of this programme which indicate how many people had reached out to those services, so it can make a critical analysis and identify any possible gaps to improve on.
Ms Brenda Sibeko, Deputy Director-General, was delighted to inform the Committee that the DSD had extended the top-up child grant and would be able to implement it within this financial year. The Department had engaged in discussion with the National Treasury, and regulations around the grant had been completed. She was confident that the top-up could be implemented in May.
The Department assured the Committee of its commitment towards helping the youth to integrate into the labour market. Its approach began with profiling communities and households in certain areas and then mobilising young people to join various training programmes. For instance, in Mpumalanga, some were trained through youth centres and others were referred to government departments for various training programmes. The Department had MoUs with other government departments to facilitate the empowerment of youth. Youths attending those programmes were gaining skills such as farming skills, supplying vegetables, computer skills, etc. The Department also did regular follow-up checks to ensure that skills acquired by those youths were compatible with the demands of the labour market.
The DSD confirmed that it had a specific unit that gathered evidence to support policy development, which required careful calibration of various interest groups and stakeholders who might be affected by changes of policies. There was a dedicated unit that dealt with regular data collection as well as a unit dedicated to policy programme evolution. The Department was also in close collaboration with the Department of Planning, Monitoring and Evaluation (DPME) on evaluating the effectiveness of policies.
The Committee was told that a migration conference had been held, during which a forum was established. One of the key decisions which were reached in the face of all the unwarranted conflict was how to ensure that migration issues had been integrated into the Integrated Development Planning for local government.
Ms Sekwana elaborated on the digital piloting programme and said that the programme had initially been conducted in a face-to-face setting prior to COVID-19. The pandemic had significantly changed the way in which the programme was conducted, as high technology had now been roped in to facilitate the empowerment of teenage parents. She indicated that there were a large number of teenage mothers who were in need of help to carry out their parental responsibilities. The programme provided exactly what they needed.
Mr Mchunu confirmed that the issues raised by the AG were being incorporated into the performance agreements of all senior managers in the Department. These performance agreements were also being reviewed in each quarter.
He said the Department had raised the issue of risk mitigation with SASSA and was currently finalising the SASSA Act. He hoped that the amendments that would be made to the SASSA Act would help address some of the systemic challenges, given that it was one of the biggest entities that received the largest budget allocation in government. The Department was also reviewing and implementing the recommendations in the forensic reports. There had been many one-on-one engagements between the CEO of SASSA and the Department, so he wanted to assure the Committee that risk mitigation measures had been taken care of.
He agreed with Members’ consensus that ensuring customer care was provided at a certain standard was important for SASSA, because it was linked to the value of the organisation. He asked Members to alert the DSD where the unfriendly or rude services had taken place, and help it to identify those offices. Good customer service was part of SASSA’s indicators in its APP. He would also communicate with SASSA’s management to ensure that they were "going to the ground" and were engaging with clients.
SASSA Annual Performance Plan 2022/23
Ms Totsie Memela, SASSA's Chief Executive Officer, presented the entity’s annual performance plan (APP) for the 2022/23 financial year. She highlighted that the entity’s strategic policies were informed by critical national policies such as the National Development Plan, the 2022 State of the Nation Address (SONA), the entity’s five-year strategic plan, the signed Minister’s performance agreement with the President, etc.
A summary of programmes 1 and 2 of the APP was provided, with details of the intervention methods to achieve those targets being indicated in the presentation slides. Overall, the entity aimed to reduce poverty levels, improve customers' satisfaction levels, enhance economic transformation, as well as improve organisational efficiency.
Mr Tsakeriwa Chauke, Chief Financial Officer, SASSA, presented the entity’s 2022/23 MTEF budget. Its allocations over the next three years amounted to R7.499 billion, R7.57 billion, and R7.91 billion.
He said that since no additional resources were available for the 2022 MTEF Budget, departments and entities must not submit any requests for baseline increases. The cost of upgrading salary levels and the relocation of records management centres would be additional cost drivers for SASSA in this financial year.
Ms Abrahams referred to the number of fraud and theft cases around SASSA’s grant fund, which even involved SASSA employees in some cases. In light of that, she asked if SASSA would re-consider conducting an overall vetting of its officials.
She highlighted the importance of efficient service in disaster situations such as the floods in KwaZulu-Natal. She was waiting to see how quickly SASSA could distribute the SRD grants and food parcels to the victims who were affected.
She wanted SASSA to confirm that all its offices were operating at 100% capacity.
She asked for more details about SASSA’s new queue management service, and what the pilot sites have shown about this new initiative.
She drew SASSA’s attention to those new mothers who were struggling to register their newborn babies for the child support grant. In some worst cases, mothers managed to register their children for the grant only when they were two years old. In light of that, had it occurred to SASSA that clinics and hospitals could be used for pre-registration? Since government always emphasised the message of taking government services to the people, she believed that was what SASSA should be doing.
She urged SASSA to reduce its appeal processing time from ten to five days and to respect those beneficiaries’ basic rights to receive grant payments.
Referring to the teenage pregnancy issue in the DSD's annual report, she asked if SASSA could determine the ages of those teenage mothers and fathers and whether it was working with the Department to put them on to this newly proposed digital programme.
She urged SASSA to respect people’s dignity by providing toilet facilities at payment points. She noted that the location of toilets at some paypoints were not practical, as they were near to the office safes.
Why were there no armed guards outside post offices on the R350 payment day? There were normally two armed guards during a normal payout week.
She asked the CFO for clarity because she could not find the line item which spoke to losses due to robberies and fraud in SASSA’s financial statement.
Ms Abrahams asked if SASSA had backup plans to deal with load shedding and the continuous closure of post offices. She emphasised the importance of providing viable payment solutions to people if they knew that a particular office was about to close.
Ms Arries enquired about the legislative amendment process that would enable the R350 grant to have legal standing. She asked how long the whole process would take.
What was the status of SASSA’s investigations into grants that had been paid into ineligible individuals’ accounts, and fraudulent SASSA cards?
How many of the qualified individuals were not collecting their grants? Did SASSA have any measures to trace those people, considering that many of them were probably based in villages and rural areas?
How many SRD grant cases were currently being appealed, and had not been finalised yet?
Ms Arries asked SASSA how many post offices had been closed and what alternative measures it had in place to ensure that the closures would not affect grant recipients.
She expressed gratitude that there had been an increase in the amount of grant relief for the victims of the KZN floods. However, given the culture of corruption in this country, she wanted to know what measures SASSA was implementing to ensure that funds would not be stolen.
She commented that 47% of South Africa’s population -- which amounted to 28 million people -- were dependent on social grants. She therefore wanted to know what other programmes were in place to help the ten million people who were currently receiving the R350 grant after the R350 grant period came to an end. She particularly wanted to know if there were any programmes that were related to skills development and training for those people.
She criticised SASSA for the poor service that it provided at many of its offices in areas such as Gugulethu. She also referred to the poor management of queues at some SASSA offices in George that had resulted in people having to pay for their places in queues.
Ms Arries told SASSA that she had received complaints from her constituents that there had been no state doctors in George to approve disability grants since last year, and wanted to know what the situation was like now.
Ms Opperman said that she had submitted her questions in writing, and would thus expect her responses from there. However, since her colleague Ms Masango was still struggling to log online, she read out her question in her place. SASSA intended to reduce its cash pay points by 50 percent. She wanted the entity to provide a list of cash pay points that would be facing the cut per province, as well as to indicate how this would impact cash-reliant beneficiaries in rural-based areas without banks, cell phones and transport.
Ms Sukers noted the organisational change process which had taken place since last year. She asked for clarity on whether that process had been equally aligned across the entities and the tangible outcomes from that change. Her observation was that she could not see any positive change happening on the ground because SASSA seemed to be jumping from crisis to crisis.
She enquired about the implication of SASSA’s budget and asked the entity to give an indication of where the additional money would come from.
She referred to the record management centres, which had been flagged as a potential financial risk. Labour-related claims amounted to more than R14 million, upgrading salaries amounted to R230 million, and there was also the relocation of management centres amounting R130 million. Given the huge costs, Committee Members still did not know how the whole thing worked, which prevented them from conducting their proper oversight role. She therefore asked SASSA to explain how the record management system worked, since a new service provider had now been appointed,
Ms Motaung asked SASSA for details of the support it provides for small, medium and micro enterprises (SMMEs). She urged it to work with the Departments of Health and Home Affairs to develop a robust system in order to filter out those ineligible children who were receiving the child support grant currently.
Ms Memela said that a substantial amount (19%) of SASSA’s budget went to SAPO. In return, it assisted SASSA with grant payments to all its recipients. There was a service level agreement (SLA) in place between the two entities. SASSA was continuously monitoring if SAPO was adhering to the SLA or not. It was also within its prerogative to impose penalty clauses, and last year it had deducted R17 million from what was due to SAPO.
She described SASSA’s alternative channels for grant disbursement. Although there was an SLA between SAPO and SASSA, the observation was that not many beneficiaries used SAPO’s services. Only 500 000 of SASSA's clients used the SAPO service to receive grant payment, and fewer than 200 000 were using SASSA’s cash paypoint service, so the number of clients that would be impacted by post office closures was few. Since COVID-19, SASSA had also discontinued the issuing of cards at post offices. Overall, SAPO had lost seven million of the 12 million SASSA clients who were using SAPO services.
Ms Memela assured the Committee that all its offices were 100% staffed.
Ms Diane Dunkerley, Executive Manager, SASSA, said SASSA was engaging in regular meetings with SAPO with regard to all the fraud and theft cases so that it could trace and demand reimbursement from the unqualified individuals. SASSA had strengthened its working relationship with the Fusion Centre, which helped it to refine the criminal prosecution aspect should it become a necessity. SASSA was very clear on its position that it would not tolerate fraud.
SASSA had already distributed vouchers with more than the usual allocation amount to more than 1 500 KZN flood victims and was monitoring the disbursement of that grant very carefully. What SASSA had learnt from its food parcel distribution during COVID-19 was that the manual process was partly to blame for maladministration and corruption. There was no manual process this time around and all information was being processed on a system which was tied back to the money it provides.
She said it was usually a challenge for new mothers to correctly submit all documents for their newborn children if clinics and hospitals were to be used for registration. In many instances, new mothers did not have those documents with them. However, SASSA did provide information to clinics to inform pregnant mothers. It also sought to reinforce the message that the sooner a baby was registered, the better the outcome would be for the child in the long term. Amendments to those documents were in progress, as some of the required documents would no longer be systematically verified by the DHA. She pointed out that the challenge around registering one’s child for the child support grant was people’s misunderstanding of the means test. This required better communication from SASSA’s side. In the more urbanised provinces such as Gauteng and the Western Cape, many people thought they would not qualify for the grant simply because they had some casual jobs or were part-time employed.
Ms Dunkerley denied that the entity was planning to reduce its cash paypoints, but was rather exploring alternative channels. It closed off cash paypoints only where the conditions of those paypoints were not ideal, such as having no seats or ablution facilities. In the event of reducing a paypoint, the entity was guided by strategies to either relocate to a nearby facility that provided shelter and seating, or another alternative channel. In some cases, SASSA was looking into mobile infrastructure.
Referring to the pilot queue management system at the Benoni office, Ms Dunkerley said that SASSA was considering a phased roll-out of the system over the next two years. However, it would require additional infrastructure in the offices. When this measure was in place, she hoped that there would be fewer people being preyed upon while waiting to receive grants.
Because of SASSA’s contractual arrangement with the banks on means testing, it had not been able to attend to the R350 appeals that had been made since August last year. The number of registered appeal cases had fluctuated from one million at the beginning, to 300 000 last month. Discussion with the banks was near to finalisation, and this would see the contracts going through until 2023. People who were waiting for the outcome of their appeals would still be paid. The entity had amended its internal process so that qualified individuals would get the grant in April this year. As the means test was part of the validation process, it would be dealt with separately by the appeal tribunal.
Ms Dunkerley said the current grant regulations had to be amended to accommodate the R350 grant since the state of disaster had been lifted otherwise, SASSA could not continue with payment of the grant.
She confirmed that there were people who were not collecting grant money due to them. SASSA was able to inform its clients only through SMS notifications. There were about 300 000 uncollected grants from the first grant disbursement date in early 2022. She said that creating additional channels for grant collection, such as post offices, the post bank and retailers, had drastically reduced queues and significantly improved the efficiency of collection. The entity had seen an increasing trend towards the collection of uncollected grants.
Ms Memela said SASSA was not a bank and clarified that the bank system which is used belonged to SAPO and post bank. People’s misconception around that emanated from SASSA’s brand image on the card.
Commenting on the organisational design change, she said there were programmes to train leaders in order to provide more support to teams at all of the different levels within the entity. She described it as a journey that had just begun and had not yet been completed. She had received reports from these programmes and was currently looking to the implementation to change the business culture and mindset at SASSA. She said this programme would run for 24 months.
Mr Abraham Mahlangu, Chief Information Officer, SASSA, commented on the lack of grant disbursement sites in Gugulethu. He said four or five sites in Gugulethu had been closed due to social ills such as gangsterism. In high crime areas like Nyanga and Mitchells Plain, the entity could not even set up mobile sites, as laptops could make its employees targets of violent crime. However, the entity had approached the Department of Public Works requesting two additional offices to be built. SASSA could not work on its own and had to be assisted by other stakeholders to ensure that grant payments were safely delivered to people.
He was aware that some people may be experiencing lack of access to state doctors in George, which had resulted in them wrongly believing that there were no state doctors. He said he would look into this issue.
National Development Agency (NDA) Annual Performance Plan 2022/23
Mr Bongani Magongo, Acting Chief Executive Officer, NDA, led the entity’s delegation team and designated Mr Ben Morule, Senior Manager: Office of the CEO, to make the presentation.
Mr Morule provided the contextual analysis of the NDA’s APP, and emphasised that its main focus was to lay the groundwork to increase interventions that would create more job opportunities, partner with key stakeholders to increase resources, empower civil society organisations (CSOs) as their service delivery platform, and coordinate service delivery at the district level.
The impact of the NDA programmes included the creation of 3 000 job opportunities, as well as various programmes to fight poverty and reduce unemployment.
Mr Morule presented the NDA’s APP, which consisted of three programmes, with their indicators and MTEF targets provided.
(See attached document for details)
Referring to the entity’s MTEF budget for the 2022/23 to 2024/25 financial years, he said the NDA’s transfer allocation for the 2022/23 financial year amounted to R219.2m, which was a R26.7m (11%) decrease on the prior year allocation of R245.9m, which had been supplemented by a special budget adjustment of R30m for implementation of the Volunteer Programme. The allocation remained substantially the same in the 2023/24 FY, increasing by R842 000 (0.4%), which was well below projected inflation of 4.4%. In the outer year of the MTEF, the budget would increase on the prior year by R9.8m (4%), which was more in line with expected inflationary increases. The NDA expected to earn R1.9 m in interest income in the 2022/23 FY, which would increase the total revenue budget to R221.27 million.
The budgets allocated for each programme were also provided.
Ms Abrahams sought clarity on the appointment process of the NDA's new board, since the names were being recommended to the Cabinet, and she did not recall any processes having passed through the Committee.
She asked Mr Magongo to confirm the statement that the “compensation of employees is a fixed cost that directly comes from National Treasury and cannot be spent on anything else." She also sought clarity on Programme 2, where it was stated that the amount had to be fundraised from either the Department or the National Treasury.
The Chairperson said she was certain Ms Abrahams had missed something, as she herself could recall some forms of interviews and short-listing that had taken place and gone through the Committee.
Ms Lindiwe Ntsabo, Committee Secretary, informed the Committee that the appointment process for the NDA board was different from that of the Central Drug Authority (CDA) board. The CDA Act required that the appointment of the board should be conducted by Parliament and Parliament had to come up with a list of names for recommendation, whereas there was no such requirement for the NDA.
Mr Magongo confirmed that the appointment of the NDA board rested with the Minister. The Minister presented a list of recommended names to the Cabinet for approval. The NDA Act did not require the Minister go through Parliament. However, since the Chairperson had indicated that she recalled a certain briefing of some sort; he was uncertain whether other ministers had been apprised of the process.
The Chairperson recalled that the Committee had been consulted by the Department.
Mr Magongo confirmed that s3.2 of the NDA Act states that the NDA may use its own allocation from the National Treasury to grant funds, but s3.1 states that it must raise funds to grant money to CSOs. So combining those two clauses, it meant that the NDA grant funding resources must come from third parties, or it may use its own funds. The money from the National Treasury was for the administrative purposes of the entity.
Minister's closing comments
Minister Zulu said she had listened to the Members’ questions and thanked them for their input. She understood that some questions may not have been adequately responded to, and thus invited them to send questions to the Department. She gave an assurance that the DSD was committed to ensuring that all disaster-related resources would be spent for their designated purposes.
The meeting was adjourned.
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