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Presentation to the Portfolio Committee on Social Development

Annual Report 2013/14

Purpose of the Presentation

• The purpose of this presentation is to present to the Parliament’s Portfolio Committee on Social Development; SASSA 2013/14 Annual Report; focusing on:

– Performance Information;

– Budget and Expenditure 2013/14; and

– Audit outcomes .

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Presentation Outline

• Overview;

• Programme Performance Information - Achievements against 2013/14 Strategic Priorities;

• Budget and Expenditure for 2013/14;

• Summary of Audit Outcomes; and

• Challenges

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Overview

Vision

• “A leader in the delivery of social security services”

Mission

To administer quality customer-centric social security services to eligible and potential beneficiaries.

The Agency’s Slogan

Paying the right social grant, to the right person,

at the right time and place. NJALO!

Key priorities for 2013/14

To deliver quality social security services focusing on the following:

•The automation of business processes;

•Improvement in the grant payment system;

•Excellent customer care; and

•Clean Audit.

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Strategic Objectives

• Strategic Objectives for SASSA for the reporting period were:

– to ensure that eligible beneficiaries receive benefits due to them;

– to improve the quality of service delivery to our customers;

– to achieve a fully integrated and automated social assistance service; and

– to ensure that the Agency is optimally capacitated for optimal service delivery.

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Performance against the 2013/14 Priorities

PERFORMANCE INFORMATION

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Implementation of the Social Assistance Programme

Planned Target Achieved

Target is to reach at least 1.2m new beneficiaries;

1 311 469 new applications were processed

Increase the number of grants in payment from 16 106 110 to 16 582 582.

• 15 932 473 social assistance benefits were in payment as at end of financial year

11 758 633 are children’s grants;

2 969 933 are older person’s grants;

1 120 419 disability grants;

• There was a 1.08% decrease in the growth of social grants due to successful re-registration and biometric enrolment of beneficiaries that substantially reduced the inclusion errors.

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Social Grants Trends: growth rates (2013/14 vs. 2013/14)

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Grant type/Period 2013/14 2013/14 Difference % growth

Old Age 2,873,197 2,969, 96,736 3.37%

War Veteran 587 429 -158 -26.92%

Disability 1,164,192 1,120,419 -43,773 -3.76%

Grant-in-Aid 73,719 83,059 9,340 12.67%

Foster Child 532,159 512,055 -20,104 -3.78%

Care Dependency 120,268 120,632 364 0.30%

Child Support 11,341,988 11,125,946 -216,042 -1.90%

Total 16,106,110 15,932,473 173,637 -1.08%

Number of grant benefits by grant type and region as at 31 March 2014

Region/Grant type OAG WVG DG GIA FCG CDG CSG TotalEC 516,952 62 179,712 12,145 116,172 18,199 1,777,042 2,620,284FS 176,973 6 80,203 1,543 39,178 6,146 630,717 934,766GP 449,843 109 112,822 2,168 55,027 15,428 1,548,796 2,184,193KZN 611,625 58 296,133 30,652 125,705 35,392 2,662,100 3,761,662LIM 421,053 29 91,357 13,048 58,571 12,559 1,626,113 2,222,730MPU 217,045 17 77,258 3,572 33,877 8,807 984,641 1,325,217NW 77,081 12 48,201 4,755 14,307 4,610 275,849 424,815NC 224,898 16 85,854 5,142 40,726 8,463 754,935 1,120,034WC 274,463 120 148,879 10,034 28,495 11,028 865,753 1,338,772Total 2,969,933 429 1,120,419 83,059 512,055 120,632 11,125,946 15,932,473

Implementation of the Social Assistance ProgrammePlanned Target Achieved

• Processing 25 000 SRD applications

• SRD Budget R509 256

• There has been an increased demand on the SRD due to high number of people experiencing hardship

• 337 148 SRD applications were processed and the total expenditure on SRD was R549 million.

New Grants applications processed within 21 days

• Of the total 1 311 469 applications received, 1 191 910 were processed within 21 days. This represents 91% of the annual target

Implementation of the Social Assistance ProgrammePlanned Target Achieved

Internal Reconsideration Mechanism (IRM): Target was to improve the turnaround for processing of IRM requests

• The Internal Reconsideration Mechanism, was improved through capacitation of officials and as a result, 89.1% of applications received were reconsidered within 90 days.

• Of the 11 196 IRM requests received, 9 880 requests were adjudicated within 90 days (this figure represents 89.1% of the received cases and is a marked improvement from the 52% that was achieved in the 2012/13 financial year)

Reviews • There was an overall underachievement of all targets related to Reviews due to management decision taken to suspend all reviews because the Agency was still busy with re-registration and beneficiaries were confused about the two processes

Improvement of Service Delivery

Planned Target

Achieved

ICROP/ Mikondzo

• Project Mikondzo (DSD, NDA and SASSA) was established to assess the sector’s footprints and impact of the social services interventions.

730 wards in the 23 poorest municipalities were visited between September 2014 and March 2014

Immediate interventions were implemented as and when challenges that required urgent attention were identified

One of the interventions was implementation of pilot programme in De Doorns (Cape Town) to support seasonal workers

• Beneficiaries in 465 wards had access social assistance programme though the ICROP

Improvement of Service Delivery

Planned Target Achieved

Addressing Beneficiaries enquiries

• The complaints and inquiries mechanism was improved with establishment of an in-house national call centre.

• 465 882 enquiries were received and all were resolved within five days

Local Office & Service Points Improvements

Planned Target

Physical infrastructure improvements The target is to have 119 facilities (local offices and pay-points) upgraded

Achieved • A total of 116 facilities were upgraded in 2013/14. The improvements covered • upgrading and/or repairs of existing buildings and new

structures• Procurement of new offices• purchasing of furniture;• Installation of ICT technology infrastructure • Branding• ablution facilities

Improvements in the Payment Process

Planned Target

Implementation of the National Payment system

Achieved • SASSA continued to benefit from the national payment system that was introduced during 2012/2013 FY.

Achieved efficiency savings of 1.2% on social assistance transfers (ore than R3 billion savings was returned to the fiscus)

850 000 grants were cancelled

• 771 237 new beneficiaries were enrolled and issued with SASSA payment card

• 99.6% of the beneficiaries received the payments as planned (only 0.4% unpaid benefits)

• SASSA continued with awareness programmes relating to use of SASSA Card and unlawful deductions using different media

Future Payment System

• The awarding of the contract for the new payment system, was declared invalid by the Constitutional Court.

• This now puts added pressure on SASSA to fast track its intent to become a paymaster and implement an in-house payment system.

• An independent Ministerial Advisory Committee on the Future Payment Model for Social Assistance Benefits Work was appointed

• The Ministerial Advisory Committee has started with the business case and architecture of an in-house payment system.

• A Round-table was held with international experts addressing key aspects of the payment system.

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Automation

• The Social Pension System (SOCPEN), was enhanced to support the standardised 4-step process for social grant applications.

• The enhancement covered the inclusion of a screening process to ensure that all documents and information were submitted and placed on file.

• A quality control process was added to ensure that all applications are verified for completeness before an application is approved.

• Other major enhancements were made to the SOCPEN system to support the new payment process and the re-registration campaign.

Governace and Fraud Management

• The 1st Annual SASSA Anti-Corruption Conference was held in November 2013, it was attended by over 600 attendees including delegates from private and public sector and Law Enforcement Agencies.

– a total of 3 571 fraud cases were received,

– 3 227 were investigated.

– 28 Fraud and Corruption cases were referred to Law Enforcement Agencies with a total of 56 officials implicated.

– 21 SASSA officials were dismissed, 24 were suspended and 2 were convicted (both serving 7 years imprisonment).

• The monetary value of finalised cases amounts to R22 325 067.

• Ethics awareness campaign was conducted as one of the initiatives of promoting and upholding good governance and fraud prevention. The Ethics awareness sessions were facilitated in regional offices, 38 district offices 238 local offices.

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Implementation of the Legal Services Model

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Office2013/14 2013/2014 No of Cases Cost (R)  No of Cases Cost (R)

(HO) 02 3 198 927.59 1 3 398 096.09(EC) 68 3 658 225.00 43 2 485 513.42(FS) 1 0 1 18 582.39

(GP) 2 61 560.00 1 227 439.41(KZN) 7 1 450 272.87 12 1 381 155.06(LP) 0 29 509.92 1 22 430.00 (MP) 1 53 869.52 0 0.00 (NC) 1 111 093.35 0 0.00(NW) 5 2 079 084.11 2 20 517.57(WC) 2 40 878.38 1 131 850.31TOTAL 89 10 683 420.74 62 7 685 584.25

Human Resource Management

• During the 2013/14 FY, conducted a rigorous staffing analysis. The exercise assisted SASSA to determine the number of critical posts it needed to prioritise and fill.

• 93% of critical posts were filled (804 out of 867) ,

– 506 posts by new appointments;

– 298 filled by internal employees

• In addition, 838 Expanded Public Works Programme (EPWP) employees and 76 interns were recruited

• Comprehensive employee wellness service were implemented , focusing on HIV and AIDS management, a healthy lifestyle, as well as promotion of, and education on financial management, addressing the work life balance.

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2013/14 AUDITED FINANCIAL OUTCOMES

FINANCIAL INFORMATION

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Overall expenditure per economic classification (2013/14)

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R'000

Item Budget Expenditure Surplus/Deficit % SpentCompensation of employees2 383 670 2 212 446 171 224 93%Goods and services 3 815 500 3 737 966 77 534 98%Transfers 23 947 27 916 (3 970) 117%CAPEX 87 931 194 123 (106 192) 221%Subtotal 6 311 048 6 172 451 138 597 98%Non-cash items - 87 872 (87 872) 0%Total 6 311 048 6 260 323 50 725 99%

Commentary on expenditure

• Compensation of employees

– 7% under-expenditure was due to late filling of posts

– The under spending on this item results from budgeted vacant positions that were not filled and some were filled late.

• Goods and Services

– Underspending on leases was as a result of delayed procurement of new offices by Department of Public Works

– Underspending on travel and subsistence arose from cost containment measures which is a positive spin-off

– Other underspending were under the items computer services, and legal fees, where expenditure is dependent on activities undertaken before payment is made and so is expenditure on legal fees.

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Commentary on expenditure cont..

• Transfers: SASSA entered into an MoU with the National Development Agency (NDA) for collaboration on the cooperatives project thus an amount of R8 million was transferred to NDA. This amount forms part of the utilisation of the retained surplus and hence the overspending.

• CAPEX: SASSA purchased new motor vehicles for all the regions thereby replacing the motor vehicles leased from GG fleet whose contract expired at end March 2014. This also formed part of the utilisation of the retained surplus and thus the overspending.

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CHALLENGES

Challenges

• Invalidity of the Current Payment Tender – this is being addressed through the new payment tender 2014

• Complaints regarding on-going deductions on the SASSA Card

• In the implementation of fraud Management strategy, the Agency had to close-out some offices due to the number of officials that were implicated in fraudulent activities

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Recommendations

• It is recommended that the Portfolio Committee on Social Development note and support

– SASSA 2013/14 Annual Performance Report; and

– SASSA financial statements for 2013/14

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