Department of Welfare Budget: briefing

Social Development

04 May 1998
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Meeting Summary

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Meeting report


5 May 1998

Documents handed out:
Estimates of Expenditure 1998/99: National plus all provinces (except Mpumalanga)

A slide presentation on the Welfare budget was given by Mr Jan Hattingh, the Department of Welfare’s Director of Financial Planning. It was reported that the 1997/98 budget has been reduced from 4.3% to 3% of the GDP. Estimate of expenditure for 1998/99 is Rm 196 399 (1997/98 Revised estimate Rm189 434; Increase Rm 6 965). In planning, the department has taken into account the population distribution.

Welfare is 20.1% of the provincial budget (Health and Education have much larger shares), an increase from previous years. (The Northern Cape is 24%, the Western Cape is 27%). There is a significant increase in total spending: R13.2 billion in 1995/6 to R20.6 billion in 1989/9. The Welfare budget throughout the provinces shows that social security accounts for over 80% of the budget. The social security budget for 1995/6 was R13.2 billion, of which 60% was for care of the aged. In 1997/8, the social security budget was R15.9 billion, of which 58.9% was for care of aged. Currently (1998/9), the social security budget is R18.4 billion, of which 58.9% is for care of aged and 12.5% for child and family care.

Welfare has received a fair deal in the national budget, but will never receive as much as is needed. All provinces have received significant increases (the Eastern Cape has received a 56% increase) except Gauteng and the Western Cape, which are deemed to have backup resources. However, there was still R2.1 billion in over-expenditure, with the Eastern Cape overspending the most, followed by the Northern Cape. The estimated overspending for the next year is R1.2 billion, but the Department is trying to redress this. Social security pays 2.1 million clients every month, 616,000 in the Eastern Cape and 315,000 in the Western Cape.

Questions posed by the committee: Ms. de Beer (NP) asked about ghost beneficiaries and also asked how to budget for people who are moving. The response was that the Department is working towards one data-base, cleaning up the invalid beneficiaries.

Ms. Tsheole (ANC)/Ms. J. Chalmers(ANC) asked how the phasing out of child support grants will affect the budget. Mr. Hattingh answered that in one or two years there should be a saving but problems are anticipated in the third year.

Mr. George (NP) asked in which two provinces were problems anticipated. Mr. Hattingh replied that Mpumalanga and Northern Province have no detailed budget structure, grouping Health and Welfare under one department. R8 million is set aside to deal with the year 2000 problem and getting the database up-to-date.

Dr. Jassat (ANC) stated that the increase in budget really only accounted for inflation and asked where the child support grant money comes from. Mr. Hattingh replied that this had been built into the planning.


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