1 PRESENTATION ON THE REGULATIONS UNDER THE SOCIAL ASSISTANCE ACT, 2004 (ACT NO. 13 OF 2004) 09 JANUARY 2010

2 INTRODUCTION/SCOPE  Section 32 of the Act  2008 Regulations  Types of grants  Means test criteria  Amendments to the 2008 Regulations  28 January 2009  26 February 2009  29 May 2009  31 December 2009  Proposed amendments to the 2010 regulations

3 1.Section 32 of the Social Assistance Act, 2004  Section 32 of the Social Assistance Act, 2004 (the Act) determines that the Minister of Social Development:  must make regulations regarding any matter that must be prescribed in terms of the Act,  may make regulations regarding any matter that may be prescribed in terms of the Act,

4 Section 32 Cont…  may make regulations regarding offences relating to anything that must or may be done or is prohibited in terms of any regulation made under this section,  regarding uniform norms and standards for service delivery, and  regarding any other matter which it is necessary to prescribe for the proper administration or implementation of the Act.

5 Section 32 Cont…  must make regulations with the concurrence of the Minister of Finance if the regulations apply to the application for and payment of grants, including maximum amounts of such grants, requirements, or  conditions in respect of eligibility for grants and the repayment of amounts overpaid in respect of grants.

Regulations in terms of the Social Assistance Act  The 2008 regulations came into effect on 22 August 2008 after approval by the Minister and with the concurrence of the Minister of Finance.  They repealed all the regulations made under the Social Assistance Act, 1992 (Act No. 59 of 1992).

Regulations cont…  The Regulations determined the general requirements for eligibility for social assistance (Chapter 1),  Provided for the application process for social assistance (Chapter 2),  Determined the financial criteria for qualification for social assistance (Chapter 3),  Provided for the payment of social assistance (Chapter 4) and the review of social grants (Chapter 5).

Regulations cont…  The Regulations also determined the special conditions for the continuation of the payment of social grants (Chapter 6) and the standard rules and procedure applicable at pay-points (Chapter 7).  Annexures to the Regulations determined the financial criteria for the older persons grant, the disability grant, the war veteran’s grant, the child support grant, the foster child grant and the care dependency grant.

Types of Social Grants  Old age grant (regulation 2)( citizens from 60 years of age subject to the means test)  War veterans grant (regulation 4)(those who fought in World War II or Korean War subject to the means test)  Disability grant (regulation 3)(an applicant submits a medical/assessment report confirming disability subject to the means test) 9

Types of Social Grants cont….  Care dependency grant (regulation 8)( payable to parents or care givers of children between one and 18 years and the applicant must submit a report confirming disability, subject to the means test)  Foster child grant (regulation7)(applicant must have a court order indicating foster care status) 10

Types of Social Grants cont...  Child support grant (regulation 6)(The child/children must be have been born on or after 1 October 1994 and under the age of 18 years),  Social relief of distress (regulation 9)(which is not a regular grant, but temporary. Individuals faced with undue hardship) 11

Means Test Criteria  Older Persons Grant, Disability Grant and War Veterans Grant.  D=1.3A-0.5B Where  A= the maximum social grant payable per annum as approved.  B= the annual income of the applicant in accordance with regulation 19 which shall include the income from assets after permissible deductions: and  D= annual social grant payable 12

Means Test Criteria Cont…  Child Support Grant  A= B x 10 where-  A= income threshold, and  B= annual value of the grant  = R 240 x 12 x 10  = R 2880 x 10  = R 28, 800 (single or R57, 600 if in a spousal relationship) 13

Means Test Criteria Cont…  Foster Child Grant  The amount is determine by the Minister with the concurrence of the Minister of Finance.  Care Dependency Grant  A = B x 10 where-  A = annual income threshold  B = annual value of the grant 14

15 5. Amendments to the 2008 Regulations – 28 January 2009  The 2008 Regulations were amended during January 2009 as a result of additional funds having been approved by National Treasury for social relief of distress.  In order to disburse these funds the definition of “designated officer” in regulation 1 was amended to allow the South African Social Security Agency (the Agency) to designate any person for purposes of receiving and processing social relief of distress applications.

5. Amendments to the 2008 Regulations – 28 January 2009 Cont…  A new regulation (regulation 16A) was also inserted in order to determine the exceptional circumstances under which social relief of distress may be provided.  This regulation ceased to apply when the additional funds were exhausted. 16

17 Amendments to the 2008 Regulations 26 February 2009,  A further amendment to the Regulations followed during February 2009,  The definition of “institution funded by the state” in regulation 1 was changed,  The purpose was to allow children in such institutions to be eligible for social relief of distress,  The amendment was only valid until the end of March 2009 when the additional funds mentioned would have been exhausted.

18 Amendments to the 2008 Regulations – 29 May 2009  During May 2009 the Regulations were once again amended.  The insertion of regulation 26A provided for deductions to be made on social grants for funeral insurance or schemes where the beneficiary of the social grant requests such deduction in writing from the Agency.

19 Amendments to the 2008 Regulations – 31 December 2009  During November 2009 Cabinet approved a staggered extension of the child support grant to include children up to the age of 18 years.  Draft regulations were prepared, published for comment and the amendment regulations came into operation on 1 January 2010.

20 Amendments to the 2008 Regulations – 31 December 2009 Cont…  The new regulation 6 determines, amongst others, that:  with effect from 1 January 2010 a primary care giver of a child is eligible for a child support grant if the child was born on or after 31 December 1993,  the grant will be paid until the child reaches the age of 18 years.

21 Amendments to the 2008 Regulations 31 December 2009 Cont…  a child between the ages of seven and 18 years who is in receipt of the child support grant must be enrolled at and attend school,  proof of school attendance must be submitted to the Agency within a month of approval of the grant,  proof of school attendance must be submitted to the Director-General of the National Department of Social Development every six months,  Proof of school enrollment and attendance is not a condition for the child support grant

Proposed amendments to the 2010 regulations  Regulation 6 is amended to read “all children born on or after 1 January 1994”,  The regulations will come into operation retrospectively – 1 January

Trends in number of Social Grant Beneficiaries Type of Grant Jan-10 Older Person’s1,818,7332,010,8842,097,9822,222,9502,508,899 War Veteran’s 4,340 3,790 3,340 1,500 1,293 Disability 459, ,9251,305,4641,408,4561,303,203 Foster Care 65,938 95, , , ,666 Care Dependency 22,438 34,978 85, , ,359 Child Support Grant 330,3281,801,8625,326,5818,189,9759,400,347 Grant-in-aid--- 37,772 51,998 Total2,701,6574,484,6559,076,21312,417,14413,880,765 % Growth-66%102%37%12% 23

Expenditure and Impact  Social Grants consume on average 3,4% of the Gross Domestic Product and about 12% of total government expenditure.  The evidence from micro-simulation confirms the poverty reducing impacts:  Social Grants are effective in addressing the prevalence of poverty 24

Expenditure and Impact Cont…  Reduce the income inequality  Spending patterns in households that receive social grants are more focused on basics necessities like food, energy and education 25

Expenditure and Impact Cont….  Developmental Impacts:  Increase school attendance  Investment in human capital because of improved school attendance  Improve health and nutrition  Increase gender equity  Promote job searching and labour market participation 26

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28 THANK YOU