PRESENTATION TO THE SELECT COMMITTEE ON SOCIAL SERVICES: DIVISION OF REVENUE Department of Social Development 12 MARCH 2003

Introduction Department has managed conditional grants since 1998/99 The following grants will be managed by the Department in the 2003/04 and over the MTEF years: Improvement of Social Security System HIV/AIDS (National Integrated Plan for Children Infected and Affected by HIV/AIDS) Extension of the Child Support Grant Food Emergency Relief The ISSS will phase out in 2002/03 financial year

Operational allocation MTEF Summary Year Operational allocation R’000 Special Allocation Total Allocation 2003/04 124,102 1,828 400 1,952 502 2004/05 137,693 4,088 112 4,225 805 2005/06 150,184 7,119 159 7,269 343

Departmental Budget 2003/04 Amount voted R1,952 502 Special Allocations Poverty Relief R 71 000 Improvement of Social Security System R 69 000 Disaster Relief Funds R 10 000 Emergency Disaster Relief R 5 000 HIV/AIDS R 65 917 Child Support Grant Extension R 1 100 000 Food Relief R 400 000 National Development Agency R 103 283 National Councils R 4 200 Total Special Allocations R 1,828 400

ISSS Improvement of Social Security System

Purpose: To improve financial management, administration and functioning of social security system Outputs provision of infrastructure & office automation tools Improved communication network and information service for speedier responses to beneficiaries effective financial management systems

Rationale for conditional grant Improvement of social security is a national priority Conditional grants ensures - integration & consistency in planning; and implementation of national programmes & policy priorities, e.g. norms & standards

Improving grant delivery Comprehensive improvement of grant administration programme was launched in July 2001 Development and implementation of norms and standards for- Applications Customer management and care Information technology Pay points infrastructure and facilities Financial administration Upgrading of the current payment system (SOCPEN). Establishment of a compliance and Support Unit

Allocation - ISSS - 2003/04 R’000 25 000 2002/03 Allocation 26 000 71 300 137 068 2004/05 2001/02 2000/01 1999/2000

ISSS -Allocation per province 1 200 642 Western Cape 10 236 5 100 2001/2002 R’000 10 800 2002/2003 Northern Cape Northern Province North West TOTAL Mpumalanga Kwazulu-Natal Gauteng Free State Eastern Cape Improvement of Social Security System

ISSS -Spending by province as at the end of January 2003 ALLOCATION 2002/03 R’000 AMOUNT SPENT TOTAL PROJECTED EXPENDITURE DEVIATION SURPLUS/ (DEFICIT) % SPENT Eastern Cape 1,200 - Free State Gauteng 100 KwaZulu-Natal Limpopo 725 60,4 Mpumalanga 455 497 703 37,9 Northern Cape 609 873 327 69,75 North West 593 49,4 Western Cape 67 5,6 TOTAL 10,800 3,649 9,770 1,030 37,3

2002/03 Spending- ISSS

Conditions and Monitoring Mechanisms Approved business plan Monthly expenditure reports Quarterly project progress reports Provincial visits - twice a year Written assurance in terms of PFMA with respect to financial management and internal control systems

Criteria for allocation Based on beneficiary population in respective provinces 2002/2003 is the final year of programme, all provinces receiving same allocation (R1 200 000) This is earmarked mainly for infrastructure

Past Performance Some provinces established operational centers Financial management improved, although there are still shortcomings reconciliation of grant payments now being done projections and budgeting models developed some monthly financial reports are produced progress with PFMA implementation IT infrastructure and other equipment installed in provinces

Challenges Data integrity still a problem Grant information system (SOCPEN) still a problem - being replaced Capacity problems still exist

National - Key Milestones Expanded capacity through restructuring Directorate: Monitoring, Evaluation and Audit established Norms and Standards developed SOCPEN replacement in progress Infrastructure audit close to completion

HIV\AIDS

HIV/AIDS Allocation Purpose: Development of home-based care programmes in the community, including replication of existing models Outputs: Increase in number of orphans identified, monitored and receiving care Material assistance to children & families counseling services to children & families Establishment of effective local institutions

Rationale for the grant Part of National Integrated Plan for Children and affected by HIV/AIDS and therefore need consistency in approach. Provides opportunity for monitoring progress with national policy implementation on a national basis . Ensure that adequate funds are provided and spent for intended purpose.

HIV/AIDS Provincial Allocations Provinces 2002/03 R’000 2003/04 2004/05 2005/06 Eastern Cape 4,798 6,658 7,089 7,514 Free State 6,650 9,228 9,825 10,415 Gauteng 6,983 9,690 10,315 10,934 Kwazulu-Natal 8,644 11,996 12,773 13,540 Limpopo 3,135 4,353 4,634 4,912 Mpumalanga 7,077 9,821 10,456 11,084 Northern Cape 2,660 3,691 3,930 4,165 North West 5,463 7,580 8,070 8,554 Western Cape 2,090 2,900 3,088 3,273 TOTAL 47,500 65,917 70,180 74,391

HIV/AIDS Spending by province as at the end of January 2003 ALLOCATION 2002/03 R’000 AMOUNT SPENT Total Projected Expenditure DEVIATION SURPLUS/ (DEFICIT) % SPENT Eastern Cape 4,798 2,340 - 48,8 Free State 6,650 3,579 6,038 612 53,8 Gauteng 6,983 4,961 71,0 KwaZulu-Natal 8,644 1,289 6,949 1,695 14,9 Limpopo 3,135 2,791 3,065 70 89,0 Mpumalanga 7,077 3,194 45,13 Northern Cape 2,660 1,882 70,8 North West 5,463 3,979 72,8 Western Cape 2,090 1,050 50,2 TOTAL 47,500 25,065 45,123 2,377 52,77

2002/03 Spending - HIV/AIDS Projection 52,8% Spending

Conditions and Monitoring Approved business plan Legal contracts signed with implementing agencies Monthly expenditure reports Quarterly progress reports Provincial visits Site visits at least twice a year by both DoH & DoSD officials

Criteria for allocation High HIV/AIDS prevalence i.e. EC, KZN, NP & NW Availability of resources and linkages with other strategies and programmes, I.e.- ISRDP & URP Poverty Relief Programme Integrated Nutrition Programme

Overview on progress Third year of implementation of HCBC and Support Improved management systems for scaling up of the HCBC&S Improved management of the R48 million allocated to this programme this year. Most provinces have already spent over 60% of their allocated funds from the conditional grant. Partnership with NGOs, CBOs and FBOs is facilitating the rollout

Overview on progress Appropriate mechanisms such as guidelines are in place Monitoring systems have been developed and are being implemented Capacity building resource material and programmes for addressing the needs of community based organisations exist. Contract workers to speed up delivery have been employed in some provinces

Overview of Progress Most officials working in the area of HIV/AIDS have received training. Some provinces are incorporating youth, women and older persons issues in the HCBC&SP Basic information and awareness programmes exist

Achievement on outputs/indicators 314 centers/sites for home/community-based care and support were supported 29 016 additional children orphaned or vulnerable due to HIV/AIDS were identified and the following services were provided Psycho social support, provision of day care and after school centers/drop in centers Placement of children in foster care and addressing the education and health needs of children 9 766 food parcels raging between R154 and R350 per parcel were provided 855 care givers received stipends, between R225 and R500

Achievement on outputs/indicators 20 695 families received support such as food parcels, assistance with funerals, linking families up with income generating projects 1 990 volunteers were recruited and trained 41 Child Care Forums have been established in some parts of the country 85 Support groups for PLWAs are being provided with both financial and professional support

Challenges Scaling up response to meet needs of vulnerable children and families Capacity constraints in some provincial departments Need to establish firm partnerships with NGOs and CBOs as implementing agencies

Fighting poverty & impact of HIV/Aids The poverty relief programme focuses on sustainable development through income generating initiatives, and targets vulnerable groups like Women, youth, children, the infirm, disabled and people infected and affected with HIV/AIDS Poverty Relief funding has been allocated to the 365 projects established at the national and provincial levels 24% of the projects are at Integrated Sustainable Rural Development and Urban Renewal(URP) nodal points The Home-Based Care programmes for people affected and infected by HIV/AIDS has been accelerated.

POVERTY RELIEF (Grant in Kind)

Poverty Relief - Grant-in-Kind Purpose: to increase self-reliance and improve social cohesion of specific vulnerable groups Outputs focus on: establishment of food production clusters Youth development projects focusing on job creation Income generation initiatives for rural women Dual-purpose projects for children, disabled and the elderly

Conditions Submission of project proposals/business plans for approval by national department Signing of legal contracts

Poverty Relief Annual Allocations 100 000 2002/03 R’000 Allocation 71 000 50 000 - 2003/04 2001/02 2000/01 1999/2000 1998/ Funds are transferred to the Independent Development Trust for payment to projects. IDT also assist with programme management.

Past Performance 365 planned projects - 315 approved Simplified application procedures and grant agreements Assistance to communities with planning of projects (social facilitation) Compliance audit conducted Development and implementation of the Monitoring Evaluation and reporting tool

Poverty Alleviation 2002/03 59% Spending [100% committed]

Allocation per province 2 942 3 811 2 238 Western Cape 44 872 4 483 7 241 2 657 5 058 8 117 2 478 4 983 7 617 2001/2002 R’000 89 535 8 646 15 633 4 315 10 446 17 429 4 386 8 690 16 179 2002/2003 2 887 Northern Cape 10 229 Northern Province 5 827 North West 59 446 TOTAL 6 874 Mpumalanga 11 274 Kwazulu-Natal 3 190 Gauteng 5 774 Free State 10 449 Eastern Cape 2003/2004 POVERTY RELIEF

Challenges Synchronizing with IDPs nodes identified annually and yet programme has a life span and 3 year commitment - 30% allocation of budget exceeded. Local government IDPs may not align with existing projects. Effort will be done for new projects. Long-term and holistic programmatic support. Capacity building. Social facilitation Impact assessment Financial cycle vis a vis development process Performance indicators for the DoSD/PRP

CHILD SUPPORT EXTENSION GRANT [From 2003/04 financial year]

Child support extension grant Purpose: to fund extension of child support grant to eligible children up to date when they turn 14 years old. This grant will be phased in over three years, and will also cover associated administrative and payment costs Outputs focus on: 7 and 8 years old in 2003/04 9 and 10 years old in 2004/05 11,12 and 13 years old in 2005/06

Conditions Funds should only be utlised for payment of eligible child support grant beneficiaries Provincial implementation plans to be submitted to the National Department for approval A consolidated implementation plan to be submitted to the National Treasury Provinces must submit to the National Department, within 15 days after end of each month detail reports on the identified matters relating to – * Beneficiary numbers * Expenditure

CONDITIONS A consolidated monthly report on above-mentioned matters must be submitted to the National Treasury within 20 days after the end of each month Bi-annual audits (September and March) of grant application and approval process to ensure compliance with legislative requirements and norms and standards for grant payment

Criteria for allocation Based on number of eligible beneficiaries (as per application of the means-test) by province, determine through the most reliable demographic and social-economic data available and in line with the purpose of the Child Support Extension Grant

Conditional Grant to Provinces 2003/04 R’000 2004/05 2005/06 Eastern Cape 272,130 866,885 1,669 903 Free State 72,497 233,242 457,870 Gauteng 66,449 193,815 359,609 Kwazulu-Natal 235,143 723,700 1,367 785 Limpopo 172,969 536,542 1,000 815 Mpumalanga 78,360 239,836 442,010 Northern Cape 19,671 63,540 121,421 North West 125,426 367,979 652,257 Western Cape 57,355 174,461 328,330 TOTAL 1,100 000 3,400 000 6,400 000

Payment schedule and Monitoring mechanisms Quarterly transfers in advance to provinces in line with cash flow projections agreed to between the nation al and provincial DoSD Monitoring mechanisms Monthly reports as set out under conditions

Capacity and preparedness A National Implementation Team, chaired by the DG of the national Department of Social Development will be convened to: * Identify detailed options for phasing in of the extension over the three year period * Assess provincial readiness for further implementing the extension * Advised the HSD on areas and locations where capacity has to be strengthened * Ensure the establishment of teams within the national and each provincial DoSD to monitor and evaluate progress made with the implementation of business plans and advise on actions to be taken to achieve set outputs

FOOD EMERGENCY RELIEF

Food Relief Grant Purpose: to provide food relief to vulnerable individuals and households Outputs focus on: Number of beneficiaries (households and individuals) receiving food relief

Food Relief Grant 2002/03 Grant in kind – funds to be transferred to the IDT as Implementation Partner for the National Food Emergency Programme in the 2002/03 financial year The IDT will assist the DoSD with the design, social facilitation, implementation of the programme during the 2002/03 financial year in consultation with all the relevant stakeholders

Food Relief Grant 2002/03 Allocation Criteria: Distribution of the 244 950 prioritised households Financial Implication of Programme: - Food parcels: R220,5 million - Project facilitation, support and administration R 9,5 million TOTAL R230,0 million

Food Relief Grant 2002/03 Allocations of food parcels per province Provinces No of Households Allocation value Rand in Millions Eastern Cape 35 000 31,5 Free State 30 000 27,0 Gauteng 5 000 4,5 Kwazulu-Natal 30 390 27,4 Limpopo 50 890 45,8 Mpumalanga 12 000 10,8 Northern Cape 4 670 4,2 North West 72 000 64,8 Western Cape TOTAL 244 950 R220,5

Conditions for conditional grants from 2003/04 Funds may only be utilised to provide food relief to vulnerable individuals and households Provincial implementation plans must be submitted to the National Department for approval Provinces must submit within 15 days of the end of each quarter, a report detailing: * Services * Expenditure

Conditions for conditional grants from 2003/04 A consolidated report on the above-mentioned must be submitted to the National Treasury within 20 days after the end of each quarter Annual evaluation reports should be compiled for the National and Provincial DoSD’s

Criteria for allocation Based on the proportional shares of poverty and income adjustment distribution per province

Conditional Grant to Provinces 2003/04 R’000 2004/05 2005/06 Eastern Cape 94,133 Free State 37,334 Gauteng 27,904 Kwazulu-Natal 68,185 Limpopo 61,146 Mpumalanga 27,651 Northern Cape 9,998 North West 41,615 Western Cape 20,034 TOTAL 388,000

Payment schedule and Monitoring mechanisms Quarterly transfers to provinces in line with cash flow projections and based on monthly/quarterly reports capturing expenditure and beneficiaries. Commencing April 2003 Monitoring mechanisms: Monthly reports as set out under conditions

Capacity and preparedness The management and administration of the poverty relief programme will be strengthened to ensure effective monitoring of the grant, and would * Identify more detailed options for expanding the social relief programme interventions and programmes * Access the possibility of integrating rapid emergency food relief with social welfare services

Challenges Finalise Provincial business Plans Capacity Building at Provincial level Procurement Process vis a vis time constraints and economies of scale