Questions were asked about the date on which the SRD grant will be paid out to eligible applicants; filling of senior management positions as well as the Director-General post; contingency measures to provide support to citizens during natural disasters; and increasing the amount of the SRD grant to above the poverty line as raised by COSATU. The Department was asked if it has done a comparative analysis of the cost of distributing the grants, especially the old age grant. Members asked if the Department has a system to quickly assess the one million appeals against SRD grant rejection so this process does not frustrate the applicants as that is a very high number.
How many South Africans now rely on social grants: 1996 vs 2020
The Government of South Africa continues to offer the SASSA Social Relief of Distress Grant (SRD 350), a grant of R350 per month for 6 months to be paid to individuals who are currently unemployed, do not receive any form of income, social grant or UIF payment etc, and include both Refugees and Asylum Seeker permit holders. You can find detailed guidelines on the application process in THIS brochure.
South Africa is a country that is not only populated by its local citizens but also refugees who call it home. When it comes to social security, the question arises as to whether refugees can also qualify to receive the Sassa R350 grant.
The World Bank has called on South Africa to introduce a job-seekers grant in a report published at the start of October. It said that a job-seekers grant, set at R350 a month, could cost R16.2 billion rand a year.
Government could announce a new R35 billion grant for South Africa next week: economists
While more than 18 million South Africans receive welfare payments, and almost two thirds benefit directly or indirectly from the grants, only child support, old-age pensions, and disability payments are handed out to people who haven’t paid into a separate unemployment insurance system. Despite the shortcomings, those welfare payments equate to some 3.3% of gross domestic product.
World Bank on South Africa’s plans to support the unemployed – including a R350 job-seekers grant
The DSD budget allocation for 2022/23 of R257 billion constitutes 13.1% of the government’s global estimated budget of R1.957 trillion. R248 billion or 99.6% is government’s investment towards the provision of social grants to more than 18 million beneficiaries. Against the allocated R44 billion, the Department is expecting to bring the COVID-19 SRD grant to 10.5 million eligible persons on a monthly basis.
In its 2021/22 expenditure, the Department did fairly well in its main programmes. Social Assistance had an underspending of R1.8 billion and Compensation of Employees had an underspending of R27 million.
The extension of the Special COVID-19 R350 Social Relief of Distress Grant has provided an opportunity to look at fundamental social security reforms including the Basic Income Support, for those without income between the ages of 18 to 59. For this cycle of the grant, all applications, once validated against the databases to which SASSA has access, have to be means tested. This can only be done by banks, who confirm if the ID number is linked to any bank account which has received an inflow of more than R350 in the preceding month (excluding social grants and R350 SRD grant).
Minister Lindiwe Zulu noted the 2022 Appropriation for the Social Development portfolio covers the Department of Social Development (DSD), South African Social Security Agency (SASSA) and National Development Agency (NDA). Today’s presentation will delve deep into a number of important issues that are relevant to the portfolio’s allocation and planned performance for the year ahead. The presentation will mainly provide complete particulars on:
• Budgetary implications on the implementation of programmes for the benefit of all South Africans
• Insights relevant to the implementation of the prominent and innovative COVID-19 social relief of distress (SRD) including the recently gazetted regulations for the continuation of this grant as well as the proposed allocation of R44 billion for the extension of the grant.
• Analysis of the adequacy or otherwise of the proposed allocation of R1.6 billion towards the introduction of the extended Child Support Grant for orphans in the care of relatives.
• DSD’s contribution towards South Africa’s economic and social reconstruction and recovery on the back of COVID-19, the July 2021 unrest, and the unseasonable severe weather systems that are adversely communities and the economy.
• Implications of the declarations of the Supreme Court of Appeal and the Constitutional Court decision on the Preferential Procurement Policy Framework Act Regulations.
The DSD allocation for 2022/23 of R257 billion constitutes 13.1% of the government’s global estimated budget of R1.957 trillion. This makes it government’s third largest budget allocation. R248 billion of the budget or 99.6% is government’s investments towards the provision of social grants to more than 18 million beneficiaries. Compared to 2021/22, the major budget reductions experienced in the 2022/23 allocation will affect the Department’s ability to employ social service professionals that are in chronic shortage in communities. The reductions will also impede the Department’s ability to fund non-profit organisations (NPOs). With the declaration of the National State of Disaster in March 2020 in accordance with the Disaster Management Act, the department innovated and implemented the COVID-19 SRD grant. The continued provision of this grant was necessitated in terms of the Social Assistance Act following the end of the National State of Disaster. The lessons learned from the earlier iterations of implementing the COVID-19 SRD grant strongly dictate that the Department ought to strengthen the fraud prevention system for this grant. Primarily for this reason the Department encourages all previously qualifying beneficiaries to reapply for this iteration of the grant and will they be assessed and validated as provided in the regulations of the Social Assistance Act. The Department understands and appreciates the delays this causes but at the same time, it has to be conscious of the fact that there are people who are applying to receive the grant when in fact some of them have gone back to work. Against the allocated R44 billion, DSD is expecting to bring the COVID-19 SRD grant to 10.5 million eligible persons on a monthly basis.
Without a doubt, a larger allocation would have enabled DSD to provide the much-needed buffer to more qualifying applicants. DSD will be implementing the extended child support grant in its commitment to formulate a comprehensive legal solution to the foster care challenges. Without the need to go through the Children’s Court process, the relatives caring for orphan children can apply for the extended child support grant of R720 per child per month. It is estimated that during 2022/23, over 191 000 qualifying relatives will receive this grant. Mr Fanie Esterhuizen, DSD Acting Chief Financial Officer, said that in 2022/23 DSD has received an additional R44 billion for the extension of the R350 grant. For 2023/24 and 2024/25 financial years, the additional is R6.1 billion and R8.4 billion respectively for inflationary increases. For Compensation of Employees DSD received an additional R11.4 million for the once off cost-of-living adjustments given to all levels of government.
R257 billion is the total allocation in 2022/23 and it goes down to R221 billion in 2023/24 because the R44 billion is only for one year and there is no indication if the R350 grant will be extended in the outer financial years. R248 billion of this total allocation goes toward Social Assistance. R7.6 billion is allocated to Social Security Policy and Administration with almost R7.5 billion of that going to SASSA Administration.
Welfare Services had an allocation of about R1 billion; however, that has reduced to R309 million due to the shift of the ECD conditional grant to Basic Education. R359 million has been allocated to Social Policy and Integrated Service Delivery and R220 million of that goes to the NDA. Mr Fanie Esterhuizen, DSD Acting Chief Financial Officer, said that in 2022/23 DSD has received an additional R44 billion for the extension of the R350 grant. For 2023/24 and 2024/25 financial years, the additional is R6.1 billion and R8.4 billion respectively for inflationary increases. For Compensation of Employees DSD received an additional R11.4 million for the once off cost-of-living adjustments given to all levels of government.
DSD received a R44bn budget for the SRD Grant which is sufficient to cover 10.5 million people. The previous iteration of the grant ended in March 2022 with 10.9 million approved applicants and approximately 1 million appeals that still need to be assessed. DSD will thus be providing the grant to fewer people in the third iteration than in the second iteration. According to survey data, there are 13.4 million people with no income and 18.3 million people below the food poverty line.
Unemployment is 35.3% (7.9 million people) for the narrow definition and 46.2% (11.7 million people) for the expanded definition. There are 13.6 million people not economically active. DSD only has a budget for 10.5 million people, hence it will need to add additional restrictions to remain within budget.
Ms Dianne Dunkerley, SASSA Executive Manager: Grants Administration, said by 17 May 2022, 10.233 million applications had been received from South African citizens, permanent residents and refugees, while a further 16 786 applications have been received from asylum seekers and special permit holders. The total being 10.250 million applications received. Of the total applications received, about 60% are people between the ages of 18 to 35. 40.5% of applications received consist of people with Grade 12 while 5% have tertiary education and are still unemployed.
DSD procures its goods and services using the Preferential Procurement Framework Act (PPPFA) Regulations. Section 2(1)(d) and (e) of the PPPFA make provision for contracting with persons or categories of persons, historically disadvantaged by unfair discrimination on the basis of race, gender or disability. DSD also procures products in accordance with industrial policies for local production and content.
DSD has ensured that it aligns its APPs to the Economic Reconstruction and Recovery Plan. For example, the following are amongst the performance areas that reflect this alignment:
• Create 176 474 work opportunities through Social Sector Expanded Public Works Programme
• Monthly payment of social grant beneficiaries as administered and paid by SASSA
• R350 Special COVID-19 Grant
• Supporting women-empowered companies (40%).
Mr Khumbula Ndaba, DSD Acting Deputy Director-General: Legal, Governance and Risk, replied that in 2021/22 DSD received R120 million for the employment of social workers and this was spent across the provinces. In total, 3 348 social workers were employed. There is a challenge as about 9 000 social workers are unemployed and for this reason, DSD has developed a strategy for the employment of social service professionals. DSD is engaging with relevant departments on this and its plan is to work with Treasury to employ all social workers and then distribute them both to the sector and in the Provincial DSDs.