1. 1 Presentation to the Portfolio Committee on Social Development Annual Report 2013/14

2. 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. 2

3. Presentation Outline Overview; Programme Performance Information - Achievements against 2013/14 Strategic Priorities; Budget and Expenditure for 2013/14; Summary of Audit Outcomes; and Challenges 3

4. Overview

5. 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!

6. 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. 6

7. 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. 7

8. Performance against the 2013/14 Priorities PERFORMANCE INFORMATION 8

9. 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. 9

10. Social Grants Trends 10 Grant type/Period 2008/092009/102010/112011/122013/14 Old Age2 390 5432 546 6572 678 5542 750 8572 873 1972 969 933 War Veteran1 5001 216958753587429 Disability1 286 8831 264 4771 200 8981 198 1311 164 1921 120 419 Grant in Aid46 06953 23758 41366 49373 71983 059 Foster Child474 759510 760512 874536 747532 159120 632 Care Dependency 107 065110 731112 185114 993120 268512 055 Child Support8 765 3549 570 28710 371 95010 927 73111 341 98811 125 946 Total13 072 17314 057 36514 935 83215 595 70516 106 11015 932 473 Annual Growth5.20%7.50%6.20%4.42%3.27%-1.08% Number of grant benefits and percentage growth over a five year period by grant type

11. Social Grants Trends: growth rates (2013/14 vs. 2013/14) 11 Grant type/Period2013/14 Difference% growth Old Age 2,873,1972,969,96,7363.37% War Veteran 587429-158-26.92% Disability 1,164,1921,120,419-43,773-3.76% Grant-in-Aid 73,71983,0599,34012.67% Foster Child 532,159512,055-20,104-3.78% Care Dependency 120,268120,6323640.30% Child Support 11,341,98811,125,946-216,042-1.90% Total 16,106,11015,932,473173,637-1.08%

12. Number of grant benefits by grant type and region as at 31 March 2014 Region/ Grant typeOAGWVGDGGIAFCGCDGCSGTotal EC 516,95262179,71212,145116,17218,1991,777,0422,620,284 FS 176,973680,2031,54339,1786,146630,717934,766 GP 449,843109112,8222,16855,02715,4281,548,7962,184,193 KZN 611,62558296,13330,652125,70535,3922,662,1003,761,662 LIM 421,0532991,35713,04858,57112,5591,626,1132,222,730 MPU 217,0451777,2583,57233,8778,807984,6411,325,217 NW 77,0811248,2014,75514,3074,610275,849424,815 NC 224,8981685,8545,14240,7268,463754,9351,120,034 WC 274,463120148,87910,03428,49511,028865,7531,338,772 Total 2,969,9334291,120,41983,059512,055120,63211,125,94615,932,473

13. Implementation of the Social Assistance Programme Planned TargetAchieved 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

14. Implementation of the Social Assistance Programme Planned TargetAchieved 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) ReviewsThere 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

15. 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

16. Improvement of Service Delivery Planned TargetAchieved 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

17. Local Office & Service Points Improvements Planned Target Physical infrastructure improvements The target is to have 119 facilities (local offices and pay-points) upgraded AchievedA 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

18. Improvements in the Payment Process Planned Target Implementation of the National Payment system AchievedSASSA 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

19. 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. 19

20. 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.

21. Governace and Fraud Management The 1 st 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. 21

22. Implementation of the Legal Services Model 22 Office 2013/142013/2014 No of CasesCost (R) No of CasesCost (R) (HO)023 198 927.5913 398 096.09 (EC)683 658 225.00432 485 513.42 (FS)10118 582.39 (GP)261 560.001227 439.41 (KZN)71 450 272.87121 381 155.06 (LP)029 509.92122 430.00 (MP)153 869.5200.00 (NC)1111 093.3500.00 (NW)52 079 084.11220 517.57 (WC)240 878.381131 850.31 TOTAL8910 683 420.74627 685 584.25

23. 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. 23

24. 2013/14 AUDITED FINANCIAL OUTCOMES FINANCIAL INFORMATION 24

25. Overall expenditure per economic classification (2013/14) 25

26. 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. 26

27. 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. 27

28. CHALLENGES

29. 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 29

30. 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 30