Illegal Deductions from Social Grants

Illegal Deductions from Social Grants

Social grants play an important role in protecting the poorest households against poverty. Section 27 of the Constitution places an obligation on the state to provide social security and social assistance to those in need. The number of social grants recipients in South Africa has increased rapidly over the past 20 years, from an estimated 4 million in 1994 to 16.9 million by 30 September 2015. According to the 2014 General Household Survey, more than one-third of black African individuals (32,8%) received a social grant, compared to 24,3% coloured individuals, 10,4% Indian/Asian individuals and 4,6% of the white population. The Child-Support and Old-Age grants are the two largest social grant programmes. The remaining grants are the War Veterans, Disability, Grant-in-Aid, Foster Child and Care Dependency grants. According to the 2016 Budget Speech, the overall expenditure on social assistance will increase from R129 billion this year to R165 billion in 2018/2019. Beneficiaries use the money to pay for food, rent, transport and other basic needs. Whatever the arguments about sustainability, the grants give dignity to the most vulnerable and provide a measure of relief from grinding debt and poverty.
 

Against this backdrop, there has been outrage and concern about the illegal deductions from the grants of SASSA beneficiaries. As far back as 2011, NGOs raised the alarm and asked government to stop the unauthorised, undocumented and unlawful debit deductions from the bank accounts of social grant beneficiaries. Part of the controversy stems from lenders providing people with loans when they have no assets. The only item they can leverage is the grants they receive from government. These lenders then make irregular, illegal and immoral deductions  from the grant beneficiaries by putting debit orders on their SASSA bank account. In terms of the Social Assistance  Act, only one type of deduction, a deduction for a funeral scheme is allowed to come off the SASSA card, and cannot  more than 10% of the grant money. Numerous complaints have been received from grant beneficiaries who had not  authorised deductions for loan repayments, prescribed debt, multiple funeral schemes, advance electricity, airtime and  even for water, which is a free basic service. In addition, debt collectors often take more than the guideline fees. After deductions, most beneficiaries have very little or nothing left.
 

The government set up an Ministerial Task Team to investigate the matter, which has yielded some progress. Over 13 000 cases of deductions have been reported to it. Of this, it has resolved 10 500 cases and is busy addressing the remaining 2 000 cases. Other achievements include the development and implementation of the recourse mechanism; the publishing of the amended regulations in February 2016 for public comment; and amendments to the Social Assistance Act. However, there have been reports that such deductions are on the increase and that the ministerial task team has been unable to resolve the ongoing concerns. According to Black Sash, “actions to remedy the crisis are inadequate and slow”. Due to an existing court case, MPs were not able to discuss the topic fully in their April meeting with the task team but made a commitment to tackle it as a matter of urgency once the court case is concluded.

In a media briefing on 6 May 2016, the Minister announced the publication of the revised Regulations to the Social Assistance Act. This will put an end to unauthorised and unlawful deductions and make it clear that a beneficiary must in person provide written permission to SASSA for a deduction. Where they cannot do this in person, SASSA will assist the beneficiary either through a home visit or other means in accordance to their policies. Funeral policy premiums will now only be made directly to the insurer responsible for providing benefits under the policy and no payments to brokers will be allowed.

The Department has put in place a SASSA owned and controlled recourse system for beneficiaries to be refunded backdated to 2012. The following measures have been put in place in order to accelerate the system:

• A 24-hour, seven days a week, toll free number including calls from cell phone numbers which will be in place shortly;

• On-site SASSA Commissioners of Oath will commission affidavits so that beneficiaries are not sent from pillar to post to complete the necessary dispute forms. We thank the SAPS for their support and request that they continue to assist SASSA with the commissioning of affidavits as we manage the transition;

• Each SASSA facility has a dedicated team to deal with deduction disputes and will do everything possible to provide a dignified service, with a quick turnaround time. Ongoing training is in place to ensure that all SASSA staff are familiar with the disputes procedures and can support beneficiaries in a professional manner;

• There is a plan in place to fast track cash refunds including via the Integrated Community Registration Outreach Programme (ICROP) and Project Mikondzo;

• SASSA has launched a specific communication strategy targeting beneficiaries to ensure that they know how to lodge and follow-up on debit deductions disputes;

• SASSA now has uniforms and name tags to distinguish staff from other service providers. Beneficiaries have to make sure they deal with bona fide SASSA officials and not those who claim to represent SASSA.

Importantly, grant beneficiaries are encouraged to monitor their SASSA branded account statements carefully, continue to register any deductions and follow-up on the resolution of their dispute.

You can read the Minister’s full statement here

Black Sash has a “Hands off our Grants” campaign, to document cases of unauthorised deductions. If you have difficulties lodging you complaint, contact the Black Sash Helpline on 072 663 3739 or [email protected] for assistance.