Poverty Alleviation Programme: briefing

Meeting report

SOCIAL SERVICES SELECT COMMITTEE
8 May 2001
POVERTY RELIEF PROGRAMME

Documents handed out:
Poverty Relief Programme Report to Parliament (see Appendix)
Department Presentation on Poverty

Department delegation: Ms Thembi Mwedamatswu (Poverty Alleviation Programme Manager), Mr Musi (Chief of Communications), Ms Moosa (Finance & Administration), Ms Sylvia Stevens (Co-ordinator, Gauteng), Ms Annette Smit (Free State Co-ordinator of the Poverty Programme)

SUMMARY
Committee members requested access to information about the location of projects in magisterial districts so that these could be visited. The Chairperson requested that the Committee receive the regular IDT reports. This would help alert the Committee to any problems, and also allow the Committee to see the success stories out there.

MINUTES
Poverty Alleviation Programme
Ms Mwedamatswu proceeded to read through the report (see Appendix).

The Minister's Spokesperson, Mr Musi, explained that the Minister had asked him to make the following points:
- it was to be noted that the Poverty Relief Programme was a three year programme.
- a report on the Poverty Alleviation Programme would be coming out soon and any problems/issues would be shared with the Committee.
- poverty is devastating to people, but that the issue of HIV/AIDS was worse, so it is really important that the government do something about these twin pillars of social ills. These issues weigh particularly heavy on women, children and elderly people.
- elderly people were being relied upon more and more for their pensions by the extended family.
- another issue needing attention is the rise in numbers of children-headed families. Often people in the community wanted to help but shunned them due to the stigma of HIV/AIDS. What then tends to happen is that people often leave food on the doorstep of such families only after dark. This means that these children miss out on social contact and do not see anyone during the day.
- there is much good will when the issue of partnerships is raised with business. Many businesses are willing to assist. Parliamentarians must take responsibility in harnessing this good will and integrate these partnerships into the programme.

Discussion
A committee member asked about the small percentage of funds allocated to the disabled.

Ms Mwedamatswu explained that the disabled sector wishes to be as integrated as possible. This group has indicated that they are not in favour of programmes specifically directed at them, but would rather be treated as part of the mainstream. In this way the department was trying to follow the wishes of this group by allocating them only 1.6% of the total budget. The department was trying to follow requests by the disabled sector. The money was not for projects as such but to enable individuals to access poverty alleviating projects.

The Chairperson asked about the disbursed funds. Where has the money been allocated to provincially? The Chairperson indicated that she would be happy to receive this answer in writing, as she appreciated that there was much detail.

Ms Jacobus raised concerns about the business plans that must be submitted before funding is allocated. She explained that many people who would want to apply for funds would be the poorest of the poor, mostly illiterate. How are such people supposed to put together a business plan? She said that she understood the need for such controls, but if she was a poor member of an impoverished community and someone asked her to provide a business plan before receiving funding, she "would run a mile".

Ms Mwedamatswu indicated that provincial breakdowns would be provided in the form of a written response, and that it had been too much information to include in the report.

In terms of business plans, the Department has recognized the requirements of communities. The Department understands its responsibility in disbursing funds, but also understand that they are there to help the poor. The Department helps by clustering its services, which helps to enable people to articulate their needs. Much experience and skills are present in poor communities, and they only need help in structuring their proposals, with which the Department assists. Funds are available to ensure that there are enough development workers to help with this.

Rev Moatshe (ANC) said that if work is done within a community, one can generally be aware of this. When the rollover of unspent funds happened previously he felt that they had failed their constituents. But if the money is now being transferred to the communities he had yet to hear of it within his own constituency. He asked if there was still a problem in the allocation of funds as he said that he rarely hears people talking about receiving money.

Ms Mwedamatswu replied that in terms of the impact in constituencies, projects have been identified within certain areas. Provinces have pockets of poverty. A specific tier of government must identify these pockets and strategise their answer to them. The breakdown of where the money has been spent by province was not in front of the team, so they could not be more specific. However she hoped that Rev Moatshe would understand that work is being done.

Ms Sylvia Stevens (speaking on behalf of the Gauteng Department) said that in terms of the impact of sustainability, the officials sit with members of the community to mobilize and empower the community. People are given secretarial assistance. The type of community that the individual comes from is assessed in order to understand what are the current realities and problems.

Mr Musi said that there has been a marked difference over the past year. The Minister had personally visited approximately 112 communities to get a sense of the realities facing these communities. The Minister also reviewed the capacity of the structures in place in order to reach out to areas that have never been reached before. The Department knew that they still had not achieved all their goals but felt that they had made great strides. The Department perhaps cannot reach each and every South African, but felt that partnerships with business could achieve this.

The Department was not only looking at the integration of the disabled but integration of other areas as well, and this is why they had a cluster approach. A 20% increase for the disabled could further isolate them from the mainstream.

Dr Flip Nel (NNP) pointed out that this week is International Hospice Week. He asked the Free State representative if the Free State is supporting the cause of the hospice in their province. Dr Nel felt that this is an important issue because the need for hospice care will escalate tremendously in the near future, and the Department of Health will not be able to cope alone. He had been shocked during a recent visit to the Free State to discover that HIV/AIDS patients occupied 80% of beds in some hospitals.

The Department was asked how committee members could access information about the location of projects in magisterial districts.

Ms Mwedamatswu replied that they can distribute that information as soon as members require. Ms Annette Smit (Free State Co-ordinator of the Poverty Programme) said that her province keeps a record of all such information, and has it ready. If the members so required, she could provide actual physical addresses, and a complete breakdown of spending. The KwaZulu-Natal representative indicated that their province was also ready with the same information.

The Chairperson noted that the issue of sustainability was mentioned in the report. She said that she was aware of the lack of financial management skills, and that she knew the Department was trying to do something about this. When was the training due to start?

She asked how often do the members of the Independent Development Trust report to the Department? Further, what measures had been taken to ensure quality control for food. A question was also asked about ensuring food security.

Ms Mwedamatswu said that gradually the Department is noticing clusters aligning themselves with certain businesses to provide quality control for food. She mentioned that the Department is also attempting to provide this information to clusters, but at the moment there is no structured quality control for food. Some quality control is inbuilt in private sector partnerships.

Reports by representatives of the IDT are given on a timely basis, provinces identify the project. The administrative processes are still at a national level. The head of the Department has to sign the form, which is then sent back to the IDT. They report as and when is needed.

In terms of capacity building for projects, they are in negotiation with a mentoring programme. The idea is that successful businesses mentor potential small business people, and in this way provide financial skills training. The Department is also negotiating with SAQA and the NQF to gain accreditation for any of their courses. This will help sell their courses. At the moment the courses do not reach a certain stage.

The Minister's spokesperson pointed out that the communities required specific skills: broad managerial skills, financial managerial skills and marketing skills. The Department is endeavouring to find out how business can assist in capacity building.

Mr Motemso (Department) said, with reference to food security, that most of our people are very hungry. The Department is not trying to produce new products but rather is building on what they already know.

He also pointed out that in terms of development projects, they do not want to set people up to fail. People do not lack finance skills, but cannot manage "external finance". There is a mix of skills that is needed in the communities.

Ms Annette Smit said that the Free State goes the extra mile in business management and skills. People are trained before the project begins. In agriculture there is technology training available. The Free State makes use of accredited trainers across the board, and marketing skills are constantly taught.

Ms Smit pointed out that hospices are not supported by the Poverty Relief Fund because they are not income-generating projects. Ms Smit felt that if the hospices can come up with a plan to generate income, then they can work something out with the Province.

Ms Mwedamatswu reminded the Committee that government policy emphasises home based care, not hospice care. All Departments have a budget for HIV/AIDS, and services must be integrated. The Department of Social Development had decided that they would focus on home-based care, which is the government focus.

Rev Moatshe wondered if the interaction between the Department and Select Committee is appropriate. He felt that the Committee needed feedback from the communities to understand what is happening.

The Chairperson requested that the Committee receive the regular IDT reports on a three or six monthly basis. This should not excuse members from visiting projects themselves. However this would help alert the Committee to any problems, and also allow the Committee to see the success stories out there, of which the Chairperson is sure there are many.

The meeting was adjourned.

Appendix 1
PRESENTATION TO THE PARLIAMENTARY SELECT COMMITTEE ON SOCIAL SERVICES
Department Of Social Development
Poverty Relief Programme
8 May 2001

1. INTRODUCTION
"Under expenditure cannot be tolerated under the midst of such high poverty. We have left no stone unturned and all of us have worked very hard and tirelessly to ensure that every cent allocated for poverty alleviation actually reaches the poorest of the poor. Under expenditure is now history. We are now looking at how to better focus the programmes such that the money can impact effectively on the lives of the millions of poor families especially in the rural areas." (Minister Z S T Skweyiya)

In this presentation we intend to outline the background, programme objectives, current trends and expenditure, and project a new and innovative integrated poverty relief approach. Within this we will from time to time weave through valuable lessons whilst pointing to a new Programmatic approach of social development and poverty reduction in general.


2. BACKGROUND
The special allocation for Poverty Relief was started in 1997/98 as a special employment programme, and was later broadened in 1998/99 to include a focus on short-term poverty relief and to help Departments reorient their delivery towards the poor. In 1999/00 part of the government's commitments at the Job Summit became an additional focus.

The general criteria for the allocation to national departments were:

· Relieve poverty in the poorest areas of provinces, in particular rural areas
· Provide for infrastructure in poor areas
· Assist in human development and in building capacity
· Provide jobs and in doing so involve the community
· Have an impact on households in which single women are the main breadwinners
· Seek to make projects sustainable in the long term
· Produce food and provide access to markets for the distribution thereof
· Promote social plans in areas facing retrenchments


3. THE SPECIAL ALLOCATION AND THE DEPARTMENT OF SOCIAL DEVELOPMENT:
The strategic objective of the Poverty Relief Programme of the Department of Social Development is to reduce vulnerability to poverty of households, families, groups and communities through sustainable social development strategies and institution capacity development.

The Department has managed the Special Allocation on Poverty Relief since 97/98 (R 50 Million), 98/99 (R 203 Million), 99/00 (R 40 Million) and 00/01 (R120 Million). This report will not cover the very first allocation (97/98 - R50 Million) as the Department's audit committee is studying reports. The results of this audit will be made public for lessons in due course.

It is important to point out that that the Special Allocation was first announced in 97/98, and there was no certainty in Government departments whether the allocation would be made available in subsequent years, so Departments including the Department of Social Development did not plan for receiving it. A measure of certainty about the Special Allocation was only introduced in 2000 by the National Treasury, which meant Departments had to apply for the allocation according to MTEF principles and thus brought in the need for proper planning.

Even though there was no certainty about the continuation of the fund in the past, the Department of Social Development had applied for the 98/99, 99/00 & 00/01 allocations according to Business plans approved by MINMEC.


4. TARGET GROUP OF THE POVERTY RELIEF PROGRAMME:
The target group of the Poverty Relief Programme of the Department of Social Development is citizens most affected by Poverty, those who are vulnerable and are rarely served by institutions in the country. The demographic groups targeted by the programme include: poor women, unemployed youth, children, child headed households, the aged and people with disabilities.

It is therefore important to note that this target group, is far below those traditionally targeted by SMME institutions such as the SMME desk of the Department of Trade and Industry. These institutions often require well thought out and written business plans before they assist. Other institutions, such as the Land Bank, have high selection criteria and an entrance floor far too high for this target group.

5. PROCESS AND SELECTION CRITERIA:
In an attempt to reach this target group, which constitutes the poorest 20% of our society, the process and selection criteria has been refined and improved.

During this Financial Year (2001/2002) projects will be selected according to the following six criteria:

1.Development of household food security through the establishment of food production clusters in communities, with a particular focus on households affected by HIV/AIDS
2.Provision and maintenance of Social support structures in communities where the prevalence of HIV/AIDS is high
3. Broadening of skills base and employment opportunities so as to reduce levels of youth criminality, whilst encouraging recreation
4.Support for income generation activities for rural women
5.Support to community-based childcare initiatives that capitalise on the economic and social capabilities of the aged
6.Support to initiatives that integrate the capacities of the disabled into the Poverty Relief Programme
7.Developing a social finance capacity so as to address poverty at grassroots.


This is a proposed budget breakdown, which will be submitted to the Heads of Social Development and MINMEC.

When considering the issues surrounding impact one must consider the fact that not all the impact measurements are quantifiable, some are rather qualitative in nature. For instance, the increased value added and impact by the Blouberg Development Project's, (a rural multi-sectoral programme) cannot be easily quantified. Up to three years ago no development or infrastructure existed in the villages of Blouberg, the up scaling of resources, Information Technology and increased water supply in the area, has increased communication, health levels and the general well being of people in that area.

Surrounding the issue of impact is the one of a creation of local level partnerships. In some instances this has capacitated local level initiatives, in others the lack of partnerships has stunted the growth of these projects. Ngwana Lela Naka brick making, Kodumela Poultry, Malokong Poultry, Thabang Poultry and Itumeleng Glass work are just five of the projects that are ready to move into the SMME sector. Since there are no strategic partnerships they are unable to 'graduate' to the next phase of their development, and so they continue to rely on the Department's intervention.

As noted earlier, a comprehensive impact analysis of the Programme is yet to be engaged on. A process to reveal the impact of the programme has been agreed on, it will examine, amongst other things;
Employment and income levels
viable local institutional structures (partnership) for the sustainable management and maintenance of poverty relief projects throughout the country within a 3 year period
the existing social support structures to poor communities affected by HIV/AIDS
the number of children who were malnourished and are benefiting from food security initiatives within the Programme
the extent of child neglect and abuse as a result of impoverished household stability
the levels of social crime and possible alternative prospects for young people
economic prospects for rural women
social economic support for the aged
Integrated approaches to development
the number of disabled people who are involved in productive activities within all target areas
levels of savings and access to credit for impoverished communities
the sustainability potential of the PRP projects


9. SUSTAINABILITY
Sustainability in terms of the PRP was initially deemed to mean the sustainability of projects beyond the initial grant period and thereby bring about the desired permanent reduction in the demand for financial support. Experience and the Mid Term Review revealed that project sustainability ranges, and should encompass economic, institutional, environmental and social support issues.

Subject to different interpretations, the Mid Term review revealed that 86% of the projects can be deemed to be sustainable beyond the project grant cycle. Issues relating to governance and access to markets are critical questions relating to sustainability beyond the grant period, projects like Sister Bucks Design School and Bokamoso Youth initiative have started accessing external markets in the grant period, this will in turn ensure long-term sustainability.

Whereas some of the projects are designed and meant to become financially sustainable, others are welfarist in nature. An example can be found in organisations like MS CARE in Orange Farm, Johannesburg, which is a HIV/AIDS home, based care organisation. Others, like Carol Shaw in Zuurebekom, have intergrated income generation activities so as to sustain their welfare initiatives.

The Mid Term Review revealed, amongst other things, that 44% of the project can be deemed as high risk or inappropriately financially managed. This was due to, amongst other things, lack of financial management skills and capacity to manage external resources. The PRP has therefore, invested enormous capacity building resources in order to ensure that;
· at least 20% of the projects become financially sustainable in the long term and
· that the majority of the projects' financial management capacities are developed.

Through the Social Finance Programme it has become clear that isolated communities and/or projects cannot possibly lift themselves out of the poverty cycle. Therefore it has become clear that an intergrated Programmatic approach that links isolated communities and households to each other will be critical to any sustainable poverty relief initiatives.


10. WAY FORWARD
10.1. The social development paradigm

The new approach of the Department is developmental and programmatic in orientation, it is based on the target group approach, with clear main objectives specified by indicators per target group.

This approach intends mainly at focusing on optimising the impact of the Poverty Relief Programme interventions. In this approach, the sustainability and empowerment of the targeted groupings takes priority. This will be achieved through combining welfare-related interventions with income generating projects to complement each other and ensure continuity. The outcomes of which could be summarised as:

1.Economic Empowerment: Entering the economic mainstream through SMMEs;
11.Institution Building: enhancing and formalising the informal nature of groupings into a single voice than can advocate and articulate their needs;
111.Effective environmental preservation: conscentising communities about their environment and the social and economic opportunity costs of its preservation.

The programme intends expanding the impact of its grants by graduating projects once they have been adequately capacitated to access other government resources. This can only be possible with a clear and precise monitoring and evaluation tool as well as some arrangements with related departments to take over.

The Social Finance Programme is being renewed to target specifically the objective of inculcating the culture of saving and some element of building household and social assets, whilst reinvesting in projects and communities so as to ensure increased sustainability.

10.2. Integrated Sustainable Rural Development Strategy (ISRDS):

At least 30% of the current budget will be allocated to the ISRDS nodes. It is envisaged that all six programmes will be implemented.

10.3. Systems and procedures:

The establishment of the of the following operational systems are in progress:

-Procedure Manual
-Monitoring and Evaluation tool - being developed with the assistance of the UNDP
-Financial and Administrative Systems
-An IT system

The Department is also reviewing application forms for the Poverty Relief Programme and the Grant Agreement.

10.4. Capacity of the Poverty Relief Project Offices:

The Department has established a National poverty relief office, which will concentrate on managing the Poverty Relief Programme. A senior official heads up the office, staffed with development workers and Programme officers. This development will significantly enhance the efficiency of the poverty relief Programme in bringing relief to South Africa's poor, as is evidenced by the dramatic improvement in the quality of projects being funded and the rate of disbursement of poverty relief funds in the past year.

Contract workers have been appointed at Provincial level and have started working; they are paid from the Poverty Relief Capacity Building and Management allocation.