Department of Social Development 2023/24 Annual Report

Meeting report

Deputy Minister’s overview

Mr Ganief Hendricks, Deputy Minister for Social Development, referred to the Department’s endeavours in social service delivery and the challenges in eradicating food poverty as envisaged in the National Development Vision 2030. There is an urgent need to address the needs of vulnerable groups. He thanked the previous governments for tackling the challenges in social services despite the unprecedented disruptions caused by COVID-19. He spoke to the Ministry's initiatives to combat alcohol abuse. He emphasised the importance of hiring more social workers to tackle gender-based violence. The expenditure report highlighted operational savings and cost containment measures implemented during 2023/24 resulting in an underspend for the DSD to carry forward to 2024/25.

Department of Social Development 2023/24 Annual Report
Mr Jacques Van Zuydam, DSD Senior Director: Population & Development, presented an overview of DSD programme performance against set targets and as well as an analysis of targets not met. Ms Thandeka Ngcobo, DSD CFO, presented the financial expenditure report. The DSD audit results were down on previous years with it receiving an unqualified audit opinion with findings. This was attributed to material errors in performance reporting; deficiencies in financial management; inability to prevent irregular and fruitless expenditure; insufficient consequence management for officials responsible for financial mismanagement; and delays in policies and legislation such as the SASSA Amendment Bill. DSD will implement the Auditor General recommendations from its forensic investigation.

DSD reported total expenditure of R259 billion against an approved budget of R260 billion, representing a spending rate of 99.39%. The R1.5 billion underspend was largely due to operational savings and cost containment measures. It also faced the challenge of fully disbursing allocated social grant funds due to variances in demographic projections.

Certain policy initiatives such as the establishment of the social security database and the employment of 55 000 social service professionals were not fully realised due to budgetary constraints. There were delays in the finalisation of key policy frameworks, including the National Development Agency Amendment Bill and the Sustainable Livelihood Framework, which impacted on its strategic objectives. In addition, irregular and useless expenditure continued to be a concern with 25 cases identified during the financial year. DSD has since conducted forensic investigations and disciplinary hearings to address these.

Overall 50 of the 65 planned goals were achieved while 15 were not. Key achievements included implementation of the electronic benefits system in the North West Province; implementation of an anti-gangsterism strategy in nine high-risk districts; provision of HIV/AIDS services to 88% of targeted orphans and vulnerable children; successful creation of over 200 000 job opportunities through the Expanded Public Works Programme (EPWP).

The report indicated some of the critical gaps in the provision of gender-based violence (GBV) support services. Although GBV shelters were established in 44 districts, eight districts continued to lack access to such services. Similarly, delays in finalising the policy on prevention and treatment of substance use disorders hindered the expansion of services.

The report emphasised the need to improve internal controls and financial oversight. Challenges included continued irregular spending due to ineffective procurement practices; delays in implementing the inspectorate for social assistance and a lack of accountability mechanisms. The Ministry has committed to strengthening administrative structures; improving record-keeping processes and enforcing stricter compliance with legal requirements. The report emphasised the importance of proactive budget planning to prevent future financial shortfalls. The report emphasised the need to restore public confidence in social assistance programmes through greater transparency and efficiency. Recommendations included improving monitoring systems such as for the disbursement of grants; efficient financial controls and strong consequence management within the DSD and its agencies.

Discussion
The Chairperson noted that whilst progress had been made in some areas, significant challenges remained.

Ms T Breedt (FF+, Free State) raised questions about the delays in policy and legislation drafting for the draft SASSA Amendment Bill, which had been delayed since the previous government. Her concerns also centred on the changeover of cards from the SASSA Gold Card to the Postbank Black Card. This change had led to long queues, system offline problems and non-functioning cards, which particularly affected the most vulnerable beneficiaries. She asked about the financial impact of the dismantling of USAID on DSD funding. She expressed concern about the slow progress in resolving 29 cases of fruitless and wasteful expenditure. She asked why disciplinary action had not yet been finalised and consequence management put in place for accountability.

Ms N Du Plessis (DA, Gauteng) also expressed concern about the fruitless and wasteful expenditure, and she cited financial mismanagement on the part of the department. She expressed concern about the delays in policy implementation on fruitless and wasteful expenditure. She emphasised the need to distinguish between the executive and legislative branches. She expressed concern about the employment of social workers. She questioned consequence management of the DSD and asked why an interim committee had been set up. Who was the consultant for drafting the amendments to the SASSA Act and why were none of the staff used? How much money was spent on this? She asked if this was an efficient use of resources.

Mr M Sibande (ANC Mpumalanga) asked questions about the Department's Zero Alcohol Campaign and asked for statistics on the provinces that have participated. He wanted clarity about the financial rollove. He also repeated the question about consequence management and asked if any arrests had been made. He was not convinced and asked for a clear timeline to resolve the cases.

Ms J Adriaanse (DA, North West) asked for a specific breakdown of irregular expenditure, including cases where procurement processes were circumvented by missing order numbers. She reiterated questions about consequence management. What sanctions were imposed and how was the money repaid? She also asked about awareness raising workshops to tackle the root causes of non-compliance

Ms L Arries (EFF, North West) expressed her concern that the target of recruiting 55 000 social workers had not been met and only 15 000 had been recruited. She asked for clarity on the distribution of these posts and the impact of this shortfall on service delivery. She enquired about the DSD and Cooperative Governance & Traditional Affairs (COGTA) plan to have an integrated social development programme and asked for the timeline. She raised concerns about DSD’s consequence management.

DSD and SASSA response
Mr Peter Netshipale, DSD Acting Director General, clarified that the report was for the financial year 2023-24 and reported on DSD's achievements and challenges. DSD, SASSA and NDA executives and officials were present to answer the concerns and questions.

Mr Brenton Van Vrede, Executive Manager Grant Operations SASSA, reported on the SASSA card changeover saying that the Portfolio Committees on Social Development and on Communications and Digital Technologies are working tirelessly overseeing the matter and SASSA is submitting weekly parliamentary reports to them on the matter. The DSD is prioritising resolving these challenges to ensure that all beneficiaries can access their April grant without difficulty.

On amendments to the SASSA Act, extensive consultations have been conducted at staff and management level and with the SASSA Board.

On consequence management, disciplinary procedures have been initiated and action taken to prevent repeat offences. SASSA has recovered overpayments. Disciplinary action has been taken for staff members who were ineligible beneficiaries.

Mr Netshipale added that the SASSA Amendment Bill was presented to Cabinet but was delayed due to the requirement of an accompanying policy framework.

Ms Ngcobo said that the high level of fruitless and wasteful expenditure was a recurring problem. R1.5 billion was transferred and another R1.6 billion was allocated, totalling R3.1 billion for expenditure adjustments to cover the shortfall in SRD grants. The consequence management was for administrative issues relating to the Loss Control Committee (LCC). DSD has set up an interim committee consisting of external members who are not part of the Department which will preside over all cases.

Mr Van Zuydam replied that DSD relies on its employees to develop policies and implement them. He did point out that the department does not work full-time in specific areas and that short-term projects require external consultants. Another element that often requires consulting is the large-scale training initiatives and research and trend analyses. Consultancy services are only utilised when internal capacity is insufficient and there are financial oversight mechanisms in place to monitor expenditure efficiency.

Ms Sylvia Legodi, DSD Programme Manager, emphasised the importance of adhering to international obligations as South Africa is a signatory to a number of international instruments. She pointed out that the commemoration of International Day for Older Persons should be commemorated daily. These should not be limited to a single event, but should be celebrated throughout the year to ensure that the rights, dignity and status of vulnerable groups are consistently recognised. She provided an update on the employment of social workers and noted that DSD is close to achieving the National Development Plan (NDP) target. The Committee was assured that further strategies are being developed to attract more labour force.

Mr Netshipale acknowledged that the withdrawal of USAID from funding HIV/AIDS programmes has had an impact. He assured the Committee that plans were underway to continue services and retain staff. He remarked that the technical side of reporting reflects the organisation's performance and paints it is a bad light. He also acknowledged that NPOs and pointed that DSD is engaging National Treasury to secure additional resources. He pointed out that food security and hunger worsened due to COVID-19.

Closing remarks by Deputy Minister
Mr Ganief Hendricks, Deputy Minister for Social Development, thanked the Acting Director-General for his leadership and the Committee MEMBERS for their insights. He explained that DSD and SASSA are grappling with serious cases of fraud and other criminal offences. He noted that the Ministry will relocate the disciplinary committee for DSD. He argued that the punishments are not severe and that officials must not be allowed to steal from the state.

The meeting was adjourned.