Minister of Social Development address, SA Social Security Agency & National Development Agency: 2008/9 Strategic Plan & Budget

Social Development

26 March 2008
Chairperson: Adv M Masutha (ANC)
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Meeting Summary

The committee was briefed on the South African Social Security Agency (SASSA) Strategic Plan 2008/9. The Agency aimed at improving service delivery, organisational capacity, minimising fraud, and improving access to the poorer areas to distribute grant funding. It was noted that the total revenue was estimated at R4,5 billion for the 2008/9 period with an estimated increase to R 4,8 billion in 2009/10. Expenditure per type of grant reflected SASSA's priorities on the elderly, children and the disabled. Allocations per province reflected that the Eastern Cape and Kwazulu-Natal were the major recipients of SASSA payments.

The Minister of Social Development provided a brief background to SASSA and noted that the key issue at stake now was to get the right people in place and pay them for the job that they were doing. There was a necessity to vet all staff and bring them up to standard. There was a need for an Inspectorate to deal with issues. There were still challenges in terms of fraud, and lawyers in some provinces were abusing conditions and taking advantage of the situation, and the lack of cohesiveness within SASSA made it easier for syndicates to operate internally. Efforts were being made to resolve this. There had been some dissatisfaction with the way grants were being issued, especially for children. Mobile units had been procured to reach the elderly, disabled and children, but the state of affairs still required improvement. There was a need to concentrate more on rural governance and he called upon NGOs and faith-based organisations, who had better networks than government, to be used. He concluded that Parliamentarians should be involved deeply with their constituencies, and support the hard work of SASSA. 

Members debated extensively the concerns around the shortage of and skills of social workers, and suggested that they should be better paid, and recognised as a scarce skill for work permit purposes. Members also stressed the need to support NGOs, the use of the post offices as access points,
questioned the new governance being proposed by the review of the legislation, and the fraud investigations. Specific questions were raised around the situation in Willowmore, and the gender and disability ratios in SASSA.

The National Development Agency
briefed the Committee on the Strategic  Plan and budget. It was noted that there was still a need to address the issue of delegations and restrictions on grant funding, which were hindering full compliance with the Public Finance Management Act, and there was a need to amend the Act to rectify these issues, as well as address the funding regime, composition of the board, and the scope of the Agency. The primary mandate was outlined, and certain strategies had been highlighted as priorities. The Agency would fund civil society organisations involved in poverty eradication projects and those that improved the capacity of other civil society organisations. There was a need for political influence insofar as obtaining funds was concerned, and the Agency was focused on developing strategic partnerships with international agencies as well as with business locally. The Agency had managed to turn around in the last two years. Of the R136.3 million budget, over 65% went to the funding of projects. He also added that the budget had been aligned from projections and the minimal increases from government were evident. Hard technical skills were now needed and monitoring and evaluation were a priority.

Members asked about the interface between the Agency and
community development, and the crossing of mandates between the Agency, the Department of Social Development and Department of Trade and Industry, as also what the Agency did to assist people in setting up businesses and coordinating with Sector Education and Training Authorities. Further questions related to the distribution of food parcels, the allocations across the provinces, pending cases, access to services, and the need to improve the application process.

Meeting report

South African Social Security Agency (SASSA) Strategic Plan and budget briefing
Mr Fezile Makiwane, CEO, SASSA, looked at achievements and challenges pertaining to the Agency as well as priorities laid out by the Minister for the 2008/9 MTEF period. He reminded the Committee that SASSA was just finishing its second year of existence. Its mandate was to address the  challenges of fragmented institutional arrangements in the various provinces, fraud, poor service delivery  and financial mismanagement, in an effort to improve the social security system of South Africa. He said that although SASSA was a fairly new institution, significant progress had already been made by way of payments of social security allocations to over 12 million beneficiaries.

One of the strategic plans involved service delivery improvement, which included standardising business processes. SASSA had procured 40 mobile units to improve access and had instituted a community outreach programme in the deep rural areas as well as tackling turnaround plans for application. Debt due to fraud of R83 million had been acknowledged and SASSA was making headway in recouping these losses. The internal audit section had been empowered to better control fraud and corruption to maintain the integrity of the Agency. Organisational capacity was discussed, specifically the financial misconduct board as well as policies and delegations. Mr Makiwane further noted the problems faced concerning lack of infrastructure and poorly trained officials requiring re-engineering. High level challenges included regulations, the disability assessment tool and rolling out of uniformity across the country.

Mr Makiwane provided an overview of the programmes, concentrating on strategy and business development. He noted a need to design payment arrangements that were cost effective, to ensure there was proper institutional monitoring and also to address the issue of service delivery.

In the areas of corporate services and change management, Mr Makiwane noted that SASSA was also dealing with enterprise resource planning, and legislative requirements. A focus on the elderly, children and the disabled was noted, as well as a need to implement the Management Information System.

Mr Makiwane then tabled slides on the budget vote. He noted that the total revenue was estimated at R4, 5 billion for the 2008/9 period with an estimated increase to R 4,8 billion in 2009/10. Expenditure per type of grant reflected SASSA's priorities on the elderly, children and the disabled as they were awarded the lion's share of allocations. Allocations per province reflected that the Eastern Cape and Kwazulu-Natal were the major recipients of SASSA payments.

Briefing by Minister of Social Development
The Minister, Dr Zola Skweyiya, provided a background to SASSA. He explained that the key issue at stake now was to get the right people in place and pay them for the job that they were doing.

The Minister noted that even people from the former Bantustans needed to be vetted and he was dissatisfied with how the process was carried out by the National Intelligence Agency (NIA) and the police. He explained that he had approached the Special Investigations Unit (SIU) to carry out investigations and was very satisfied with their work, as SASSA was unable to do investigations. He stated that the SIU had also promised to train people for deployment in SASSA. He added that there were many people whose standards fell far below those required in terms of qualifications, but there was an understanding that this would be resolved by the Trade Unions and SASSA by providing the necessary training. 

The Minister explained the need to bring into existence an Inspectorate to deal with issues. He stated that the former Bantustans still presented a challenge in terms of fraud, and lawyers in the provinces were abusing conditions and taking advantage of the situation, Natal being a case in point. He noted that with a lack of cohesiveness in SASSA there were a number of syndicates operating from within the organisation. He explained that he had asked the Department of Public Service and Administration (DPSA) to assist in resolving this matter and they had done well. He said that political responsibility needed to be taken by SASSA and appealed to civil society and the churches to assist. 

With regard to the question of outreach programmes, the Minister stated that dissatisfaction had been expressed with the way grants were being issued, especially for children. The Minister explained everyone should have access including all the rural areas in provinces. He said mobile units had been procured to reach the elderly, disabled and children, but the state of affairs in the Eastern Cape, the Free State and Kwa-Zulu Natal left much to be desired.  Given the challenge of reaching out to the poor, the Minister said that many things that should be in place, like water, sanitation and other services are still not there.

The Minister emphasised the need to concentrate more on rural governance and stated that there were not enough NGOs focusing on the rural areas in our country. He also noted that faith-based organisations had better networks than government and should be drawn upon. He felt that the Department of Agriculture should be used more extensively and that Parliamentarians should talk with their constituencies. He expressed admiration for the National Council of Provinces for what they were doing.

In conclusion the Minister stated that SASSA was facing many challenges but they were working hard and doing a good job.


Discussion

Mr K Morwamoche (ANC) said he supported an endeavour to run SASSA as efficiently as the South African Revenue Service (SARS). He noted SARS' ability to hire and retain talented staff. He said that inherited officials from the Bantustans who were poorly trained were a problem in themselves.

Ms H Weber (DA) was concerned about social workers not being treated as enough of a scarce skill and noted that social workers from outside wanting to work in South Africa were not given the same preference and assistance as other professions. She said that social development revolved around them, and that this matter should be addressed.

Mr Zane Dangor, COO: Department of Social Development, responded that there were different regulations for social workers wanting to enter the country. It was not defined as a scarce skill in this instance.

Minister Dr Skweyiya responded that social workers ought to receive better remuneration as their job was to deal with the soul and suffering of South Africa.

Mr B Solo (ANC) said there were not satisfactory services for traditional non government organisations (NGOs). He noted the importance and role of faith-based organisations in these rural communities. He said that there needed to be a bias shift to rural communities and support for NGOs. He wanted to see a clear blueprint to show an effective shift of work with core community organisations.

Dr Skweyiya responded and indicated the long standing co-operation the Department had with the Catholic and Anglican church as well as African Traditional Churches. He noted the success the churches had with distribution of food parcels in the past.

Dr Skweyiya said that he was not satisfied with the treatment of social workers. He pointed out that the lack of infrastructure with regard to delivery of grants left much to be desired. He said this infringed on the dignity of ordinary people. He suggested the use of the Post Office to provide grants to the public. He said the Post Office offered no response, and suggested that parliamentarians should interrogate the matter further. He also pointed to the dearth of Home Affairs and Social Development offices in these areas and again cited budget as a limitation.
 
The Chairperson asked about procurement and wanted to know what the governance arrangement was in anticipation of the new legislation around the review of the SASSA Act. He asked about the idea of the internal inspectorate. He said that it had been expected that the inspectorate be established from day one. He then raised the issue of the appeals board and asked if this could not be used to relieve the backlog of litigation. Finally he asked about the fraud investigations into an un-accounted for sum of R40 million and what had happened with clearing that amount.

Mr Makiwane said the vetting process was being improved. This included background checks, qualification analysis and screening.


Ms Thandi Sibanyoni, Executive Manager, Internal Audit: SASSA, responded around the establishment of the inspectorate and appeals board. She agreed they should have already commenced. There had been use of social assistance legislation to conceptualise for the inspectorate. She said that SASSA were building capacity. The Appeals Tribunal centre would adjudicate through panels.

Mr Selwyn Jehoma, DDG: Social Security, Department of Social Development, said that implementation was far too slow due to extensive consultations with provinces concerning regulations. Final comments from the National Treasury were expected soon, and then the regulations would be available for promulgation.

Ms Patricia Maloka, DDG: Department of Social Development, dealt with the unaccounted-for R40 million.
She said DSD were able to account for all except for R600 000, and had concluded that the transactions were fraudulent. Arrests would be made within the next week.

Ms I Direko (ANC) said that the government failed to monitor tertiary institutions. Social Work at Universities had been neglected. She said it was incumbent on government to put up monitoring structures to produce social workers in the future.

Ms J Semple (DA) referred to a report on Willowmore in the Eastern Cape as being one of the ten worst places to be a child. She asked if the 40 mobile units were enough, considering their cycle of rotation was. She wanted to know if they reached places like Willowmore.

Mr Bandile Maqetuka, Executive Manager: SASSA, responded that eight mobile units per district had been deployed. He said they targeted the most deeply rural areas and had been deployed to Willowmore

Ms M Gumede (ANC) asked about gender balance and disabled persons within SASSA. She also asked about disciplinary actions taken against those who had acted incorrectly.

A representative of SASSA responded that pre-audit systems were in place to serve to prevent wasteful and fraudulent transactions. She said SASSA was engaging in compliance management and had a call centre where irregularities could be reported. In regard to the acknowledgment of debt, the bulk of people involved were not employees of SASSA, instead they were spread across the various departments. 

National Development Agency (NDA ) presentation
Mr Godfrey Mokate, CEO:NDA briefed the Committee on the Strategic  Plan and budget of the National Development Agency. He started by raising various problems, noting that the issue of delegations was needing to be addressed, and grant funding was restricted. He said this was problematic in that it hindered the NDA from being consistent with what was required by the Public Finance Management Act (PFMA). He suggested that there was a need for amendment of the NDA Act to fix this problem, as well as address the funding regime and composition of the board of the NDA. He said the Act also should better define the scope of the NDA, in terms of addressing organisational entrepreneurship.

He outlined the primary mandate of the NDA, which was to contribute towards the eradication of poverty and its causes by granting funds to civil society organisations, for the purposes of carrying out projects or programmes that were aimed at meeting the development needs of poor communities. NDA was also to strengthen the institutional capacity of other civil society organisations involved in direct service provision to poor communities.

He identified a focus on high level strategies that would be addressed as a priority. He noted that the primary mandate stated that the NDA dealt with the poorest of the poor on the ground, with regard to community based organisations. He explained that NDA would grant funds to two types of civil society organisations; namely those involved in poverty eradication projects and those that improved the capacity of other civil society organisations.

He paid special attention to the mission and vision of the NDA. The mission was to facilitate development, through targeted grant funding, research and strategic partnerships, and the vision was to achieve a developing society free from poverty. These dual objectives would be pivotal in the forward planning.

Mr Mokate set out the strategic goals. He said that there was a need for political influence where obtaining funds was concerned and that the NDA was focused on developing strategic partnerships with international agencies as well as with business locally.

Their goal of the provision of micro information, where information was available and acquired by the NDA, was highlighted. He said that NDA had managed to turn around in the last two years. It was now an entity with working processes and system. With regard to trends Mr Mokate stated that out of the R136.3 million, over 65% of the budget went to the funding of projects. He also added that the budget had been aligned from projections and the minimal increases from government were evident.

He said hard technical skills were now needed and monitoring and evaluation were a priority. He referred to the budgetary allocation and noted the minimal increases from the National Treasury. He noted that the impact on the ground was good, adding that spending would reach 100% by the end of March. He concluded by saying that macro indicators were used to aid the public to measure the NDA's performance, as they spoke to the high-level externally-focused objectives that would be achieved through implementation of the NDA's strategic goals.

Discussion

The Chairperson asked the NDA to comment on the line function and interface between the NDA and community development. He asked what needed to be done to ensure a successful interface.

Mr Dangor responded that the community development portfolio received R37million, which included administration. He emphasised that the NDA became a key service delivery institution because the bulk of the work was done by this Agency.

The Chairperson commented that one had to see where this would lead in terms of weaning people off traditional welfare and towards supporting community-based initiatives. He added that the poverty alleviation programme of the government needed to be transformed. He stated further that the mandates of the DSD and the Department of Trade and Industry (DTI) were unclear regarding small and medium enterprise development.

Mr R Mogano, Director, NDA,  explained that a Memorandum of Understanding (MOU) had been signed with the DTI around the strengthening of co-operatives and that this MOU translated into a relationship with the Small Enterprise Development Agency (SEDA).

Mr Dangor added that there was a need to engage more vociferously around difficult mandates to implement like those regarding the implementation of policy.  He also noted the importance of looking at a strategy to invest and re-invigorate capacity building NGOs.  He explained that the poverty line programme was being led by the Treasury and that discussions should be opened to a wider range of stakeholders, including New Economic Development and Labour Council (NEDLAC) 

Mr Mokate noted that that the NDA was applying strict criteria for hiring as they wanted to introduce the element of professionalism to avoid being sued by communities for non-delivery. He stated that the NDA might compromise on experience but people had to fulfill 80% of the criteria.

Ms Weber asked about business plans as an application for funding to the NDA. She asked if the NDA could recommend a place where rural people could go to get assistance to set up business. She also if the NDA co-ordinated with the Sector Education and Training Authorities (SETAs).

Mr Mogano answered that there were two process in place. One was the conventional route where there would be a request for proposals and a public competitive process. This was meant for those applicants who had the capacity to comply. The second was for the poorer communities, who did not have the resources to deliver a formal business proposal. NDA would use development managers and deploy them to pre identified communities. The projects were driven by what had the potential to succeed in these communities. This programme was also suffering from budget constraints.

On the matter of co-ordination with SETAs, he said they had a partnership with two SETAs and that these were very useful as the NDA's projects were mostly agricultural and these SETAs had solid relationships with producers.

Mr Mogano added that NDA were using the statistics from Statistics SA to allocate funds with a baseline of R3 million.  

Mr Morwamoche asked if there were regulations on who qualified for a food parcel and if there was a uniform approach in this regard. He noted the Limpopo and the Eastern Cape had the highest proportion of poor (77% and 72% respectively). He asked what was being done about this. He also wanted to know what funds had been allocated to litigation.

Mr Dangor responded that the NDA did not distribute food parcels. This was a provincial function. He said the NDA was involved in the alleviation of social distress and making sure people were not punished for being poor. He said there was a focus on developing linkages to other services for grant recipients.

Mr Mogano said that Kwazulu-Natal, Eastern Cape and Limpopo received the lion's share of allocations already. He said the Northern Cape could be equally deserving and that the situation needed review.

Mr Mokate said that the two cases pending had been dealt with and that litigation was not currently a  concern.

Ms Gumede asked how township and rural people could access  the NDA's services. She noted that quite a few people had problems accessing funds and wondered if this was not because of the style of the application forms

Mr Mogano said that the feedback on the application process had shown that it was not regarded as empowering for poorer communities. With regard to business plans, the NDA did provide assistance. This function resided with the development managers, and some functions had been outsourced.

The meeting was adjourned.

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