ATC090218: Report Annual Report, Financial Statements and Auditor-General’s report 2007/08

Social Development

Report on the Department of Social Development’s Annual Report, Financial Statements and Auditor-General’s report 2007/08, presented to the Portfolio Committee on Social development on 21-22 January 2009, in Parliament.

 

DISCUSSION

 

The Department briefed the Committee on three areas of its Annual Report 2007/08, namely, Institutional Capacity, Comprehensive Social Security and Welfare Services. Issues raised included the need to interrogate the reasons regarding problems faced by the Independent Appeals Tribunal and challenges around the implementation of the means test for social grants and Integrated Community Development.

 

Mr Zane Dangor, Chief Operations Officer presented an overview of the Annual Report and he among other things mentioned the following:

 

Human Resource Management

 

1)                   He indicated that data for the years 2005 and 2006 was included in the presentation to show the Committee how the Department has managed the issue of vacancies.

2)                   The Department managed to reduce the vacancy rate to 14%. The Department had implemented the new supply chain management directives promulgated by the National Treasury.

3)                   He outlined at length the key achievements of the Department in its international obligations function. Focus on this obligation increased considerably since 1994 with the objective to forge long-term partnerships with developing countries

Final Audited Expenditure for the 2007/08 Financial Year
 

Mr Coceko Pakade, Chief Financial Officer briefed the Committee as follows:

 

1)                   He contextualised the issues related to expenditure in the current financial year. The Department made key interventions in improving its performance and this resulted in an unqualified Auditor General report. The bulk of the budget was transferred to households and the Child Support Grant was extended.

 

2)                   Since the National Department took over from provinces, projections had improved significantly, and the Department almost spent all its budgeted allocation.

 

3)                   He outlined the specific reasons for under spending but they were mainly related to the Department’s failure to fill vacant posts due to capacity constraints.

 

4)                   He said that the National Development Agency (NDA) had been trying to get more money from the fiscus to expand their services, but had been unsuccessful. The Department was engaging with the NDA to sort out these matters.

 

5)                   He said that the Department is reviewing the legislation regarding the Disaster Relief Fund to consolidate this fund. The Department is also reviewing the proposal to minimise the Board’s involvement in this process, as in most instances it results in delays. This would ensure quicker response in providing assistance to the victims of disasters before the area is declared a disaster area.

 

6)                   He also reported on the Auditor General opinion, which noted that challenges related to transfer of functions from the provinces to the national Department resulted in most of the balances not disclosed because the Department was unable to do so until 2007/08. The Department hopes to reconcile all the debtors by the end of 2008 as an extension had been obtained from the Auditor General for disclosure in March 2009.

 

During the interaction with the Committee the Department further provided the following information:

 

Mr Pakade:

 

1)                   The Department did not have overspending. Where it appeared that there had been overspending, this merely reflected consulting fees, which had been budgeted for but not used. The savings do not necessarily mean that the key deliverables were not achieved.

 

2)                   He indicated that there may have been some projects that had not been fully executed and implemented. Thus, money had been budgeted for but not paid to suppliers in the financial year under review. Savings usually occurred when there was under spending, when a strategy was changed or efficiency gains were used.

 

3)                   A process of engagement with the Planned Parenthood Association had been started and a project plan was being developed. In terms of the regulations, certain protocols had to be met and as a result the process took longer than anticipated. When the funding could not be sourced, the Department applied to National Treasury for approval and asked for a rollover. The application was granted and the Department was allowed to pay this in following year.

 

4)                   During audit process, Mr Pakade informed the Auditor General that the Department was in the process of developing a disaster recovery plan, and therefore it was not yet signed-off and approved.

 

COMPREHENSIVE SOCIAL SECURITY

 

Mr Selwyn Jehoma, Deputy Director-General: Social Security briefed the Committee as follows:

 

1)                   The Government had adopted a Three Pillar approach to social security. These are Social Assistance, Social Insurance and voluntary contributions for benefits outside of Pillars 1 and 2. He outlined the function of the social assistance and its impact on children, youth and family benefits, Old Age and Disability, and other social assistance policy Developments.  He explained how Social Security Transfers and Administration are implemented. He also reported that the Department completed four feasibility studies regarding Social Insurance.

 

2)                   The Department is of the view that Social Relief should be implemented by provinces.  This would enable the national Department to review progress on this matter and assess how people who were not covered by the main social assistance grant were coping.

 

BRIEFING ON THE MEANS TEST

 

Mr Thabo Rakoloti, Chief Director: Social Assistance briefed the Committee on the workings of the Means Test as follows:

 

1)                   The Means Test for Child Support Grants has been increased from R1100 to R2300 per month. The Department has a formula that automatically adjusts as the grant value increases. This formula works similarly for the Care Dependency Grant, Old Age Grant, Disability Grant and the War Veterans Grant.

 

2)                   During 2008 the Department engaged with National Treasury to universalise Old Age Grant and the approach taken was to ensure that the Means Test threshold should be gradually increased to allow for greater access to this grants.

During the interaction with the Committee the Department further provided the following information:

 

Mr Jehoma

 

1)                   The Department conducted a review on the increment of grants and assess whether it was sufficient to wither erosion as a results of inflation. He said the Department now has a formula that is self-adjustable in line with incremental changes to the grant value. Subsequently, the threshold is adjusted.

 

2)                   The Department has not looked at what the Old Age Grant could or could not buy as this is still determined by the historical situation of the country. He raised the concern that at the current value, the Old Age Grant is close to the minimum wage and might create a disincentive to work.

 

3)                   The issue of universalisation of social security was a political issue and must be engaged with at a strategic level.

 

4)                   A dedicated programme was launched, which is part of the Government programme of action to link social assistance to economic activity. The Department provides social assistance to care givers of children who are in a Work Fair programme and Welfare to Work programme. For care givers, social security could link them to work but they could not be expected to provide the work. The challenge with this approach pertains to ensuring that institutional arrangements and institutions like that of Labour and Social Assistance work in collaboration. 

 

5)                   Provinces are interpreting the regulations regarding where to apply for social relief differently. A special meeting with Heads of Department was held last year and the Procedure Manual was made available. This will enable any SASSA employee or social worker to be familiar with the regulations. Any office of SASSA provides social relief of distress.

 

 

INDEPENDENT TRIBUNALS FOR SOCIAL ASSISTANCE APPEALS
 

Mr Armstrong Malope, Director, briefed the Committee as follows:

 

1)                   He provided a background to the Appeals process and noted the inherent delays which have resulted in the backlogs which dated back as far as 2004.

 

2)                   He presented the Appeals Service Delivery Model and the Establishment Progress processes. He explained the composition of Tribunals, the current workflow process and the way forward for the phasing in of the decentralising the system

 

3)                   Large numbers of High Court cases in KwaZulu-Natal (KZN) were due to disgruntled appellants who were frustrated with the Department and planned to go to the High Court. The numbers of disgruntled persons were around 3000 and all were scheduled for tribunal sittings. 
 

4)                   The question regarding the high numbers of litigation in KZN was difficult to respond to. This was partly due to the lack of communication regarding information from appellants. There are a number of attorneys who specialise in these matters, and the Department commissioned a study to investigate the matter. The preliminary findings, found that some appellants were not even aware of these matters being referred to High Courts. The investigation is still ongoing.

 

5)                   Regarding alternative plans the Director-General was committed to dealing with at least 35% of the cases before the end of the financial year. Due to inadequate resources on the ground, there were not in place. The Department plans to go full scale to enlist panel members in all provinces

 

During the interaction with the Committee the Department further provided the following information:

                                             

Mr Dangor mentioned that:

 

The Tribunal was funded by the oversight budget. He noted that there was a sense that the Department had under budgeted and fell short in estimating ‘the size of the beast’. Treasury was approached but did not approve the budget.

1)                   Questions about process issues would be explored the following day with SASSA, including medical assessments.

 

Mr Jehoma mentioned that:

 

1)                   The Department had a better planning system, but when the functions were shifted to SASSA, all persons from Grant Administration were moved and only a small component was left for policy work. It has therefore been extremely difficult to find applicants with social security qualifications.

 

2)                   The Inspectorate is not an institution that the Department had envisaged, and Treasury has disowned what they had previously proposed regarding such a structure. He also said that the one benefit achieved was better compliance and that objective had not been lost.

 

On the issue of funding, Mr Pakade said that:

 

1)                   Treasury had allocated funding for the establishment of an Appeals Tribunal, but the question was whether the money was sufficient. The National Treasury based their argument on two things: firstly, the Department of Social Development is seeking funding for an extensive structure that could be decentralised to provinces and regions; and secondly, that the Department is dealing with a huge backlog.

 

2)                   The Treasury felt that the Department should put more money into addressing the huge backlog and not into creating a new entity.

 

3)                   Regarding litigation costs and the huge risks involved in this area, the Department incurred costs due to inefficiencies in administration. The funds had been initially earmarked for SASSA, however SASSA did not receive them. For the Department the only risk is when the backlog is not addressed. There are 52 000 cases that might go the route of appeals with litigation. If appellants were given clear dates and timeframes for adjudication then there would be a reduction in potential litigation.

 

4)                   The National Treasury was reluctant to pay for this, and the Department would have to deal with the reality when faced with it.

 

Programme Performance Welfare Services

 

Dr Maria Mabetoa, Deputy Director-General: Welfare Services presented the following:

 

Welfare Services Transformation

 

1)                   The draft Social Services Professions Bill has been developed.

2)                   The Department has drafted the policy on social services and partnerships with NGO’s in preparation for the development of the legislation for social services.

 

Substance Abuse

 

1)                   The Substance Abuse Bill was approved by the Cabinet and introduced to Parliament.

2)                   The costing of the Bill has been finalised.

3)                   Draft minimum Norms and Standards for out-patient centres have been developed.

 

Services to Children

 

1)                   The Children’s Amendment Act 2007 was passed by Parliament in November 2007 and signed into law in March 2008.

2)                   A draft of regulations on the Children’s Amendment Act has been completed and made ready for publication and comment.

3)                   A strategy to address backlogs on foster care as well as alternative care strategy which includes residential care and adoption services has been finalised.

4)                   The department continuously provides support to provincial departments in the registration of ECD sites.

5)                   The Department conducted training to provincial officials on the parenting programme and initiated implementation of the programme in some ECD sites.

 

 

Services to People with Disabilities

 

1)                   A draft implementation strategy on policy on Disability that will be taken for consultation during 2008/09 has been finalised.

2)                   Consultations with provinces on draft rehabilitation guidelines for persons with disabilities have been finalised.

3)                   About 150 officials, both in government and NGO’s, have been trained on disability policy and minimum standards.

4)                   An audit of support services to children with disabilities has been initiated and a service provider to write a report has been appointed.

 

Services to Older Persons

 

1)                   Draft regulations on the Older Persons Act of 2006 have been developed.

2)                   The regulations have been taken for consultation with stakeholders in nine provinces.

3)                   The Act will be ready for implementation by April 2009.

4)                   Norms and standards for both Community-Based Care and Support Services have been aligned with the new legislation.

5)                   About 500 older persons and forum members on the charter on the rights of older persons have been trained.

 

Families

 

1)                   Training of 140 service providers on the implementation of the family strategy in all provinces was conducted.

2)                   The Department has established one-stop crisis centre for victims of crime and violence in Mitchell’s Plain in partnership with the UNODC.

3)                   Funds were allocated to 26 NGO’s from the Criminal Assets Recovery Funds to support delivery of victim support services.

 

Social Crime Prevention

 

1)                   Secure Care Detention Management System has been rolled-out to seven provinces and 174 officials have been trained as end-users in 22 facilities.

2)                   A customer care excellence training of 164 probation services officials has been conducted.

3)                   About 25 provincial coordinators on minimum norms on diversion have been trained.

 

Integrated Community Development

 

Dr Connie Kganyago presented as follows:

 

Integrated Community Development had been divided into four programmes; namely, HIV/AIDS, Community Development, Youth Development and Non-Profit Organisations.

Programme 3: Social Welfare Services (HIV and AIDS)
 

1)                   The Department of Social Development strengthened its support of Home/Community-Based Care and support initiatives, by funding of 1 579 Home/Community-Based Care organisations and 617 drop-in centres through provincial offices.

 

2)                   The Department also ensured that 60% of all funded Home/Community-Based Care organisations complied with the norms and standards set by the Department.

 

3)                   The Department provided services and support to 50 887 Child Headed Households within the Home/Community-Based Care and that it was estimated that South Africa has 1,5 million maternal orphans.

 

Programme 4: Community Development, Non-Governmental Organisations and Youth Development
 

1)                   The Department developed a Partnership with Trade and Industrial Policy Strategies (TIPS) under the supervision of the Second Economy Strategy in the Presidency that facilitated the ‘Communities Work Programme’ in the form of a work guarantee scheme.

 

2)                   It also conducted a Skills Audit of Community Development Practitioners (CDPs) in all nine provinces.

 

3)                   The skills audit focussed on the geographical location of the CDPs and their capacity to deliver sustainable community development programmes.
 

Non-Governmental Organisations

 

The Department completed and gazetted the Regulations of the terms and conditions to appoint a technical committee that complied with Sections 10 and 20 of the Non-Profit Organisations Act that would strengthen and improve the regulatory framework of non-governmental organisations.

Youth Development
 

The Department engaged stakeholders on the National Youth Service in all nine provinces as well as processing sights for the implementation of the National Youth Service Programme.

CONCERNS AND RECOMMENDATIONS OF THE COMMITTEE

 

1)                   The Committee felt that the Means Test was not a user friendly system for customary marriages. It was clarified that a legal union necessitated a duty of support even for multiple spouses.

 

2)                   The Committee expressed disappointment that provinces were not implementing social relief of distress programme in a uniform manner, but were assured that the regulations to inform applications would be provided by the Department.

 

3)                   The Department’s failure to establish an Inspectorate as provided under the Social Assistance Act 2004 was a major setback for the Department.

 

4)                   The high numbers of appellants in KwaZulu-Natal was discussed with a view to remedy the matter.

 

5)                   The Committee noted the high number of children placed under foster care in South Africa which could be ascribed to the many stumbling blocks encountered in the permanent placement of children, particularly, in adoptions.

 

6)                   The Committee noted that there were complaints from people that many old age homes were in poor condition.

 

7.                   The Committee expresses concern over the use of Social relief for registration for tertiary studies. The Committee has already addressed a letter to the Minister of Education requesting it to furnish the Committee with mechanisms it has put in place to provide financial assistance to assist students pay for registration fees.

 

RECOMMENDATIONS

 

1)       The Committee requests that a list be made showing the Mini Drug Master Plan reports that provinces submitted.

 

2)       Substance Abuse should be moved to the Social Crime Prevention section.
 

CONSIDERATION OF THE FINANCIAL STATEMENTS AND THE AUDITOR-GENERAL’S REPORT

 

The Committee considered the above mentioned reports and is satisfied with the improvement achieved with management of funds of the Department and Agencies as reflected on the Auditor General’s report and decided therefore not to hold separate hearings in that regard.

 

Report to be considered.