Presentation of 2007/08 Annual Report to the Portfolio Committee on Social Development

Presentation of 2007/08 Annual Report to the Portfolio Committee on Social Development

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Outline of the presentation

The presentation covers the following:

Part One: General Information; Part Two: Achievements against 2007-2010 Strategic Plan

Priorities; Part Three: Grants Statistics;

Part Four: Budget and Expenditure for 2007/08;

Part Five: Auditor-General Report and Comments; and Part Six: Challenges and Concluding Remarks on 2007/08

financial year.

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PART ONE

General Information

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Legislative Mandate

SASSA derives its mandate from the following Acts: The Constitution of the RSA, 1996 (Act No.108 of 1996) as Amended – “everyone has the right to have access to : Social

Security, including, if they are unable to support themselves and their dependants, appropriate social assistance”

Social Assistance Act, 2004 (Act No.1 of 2004)- “provide for the administration of social assistance and payment of social grants.”

SASSA Act,2004 (Act 9 of 2004)- one of the object of the act says the Agency will “act, eventually, as the sole agent that will ensure the efficient and effective management, administration and

payment of social assistance.”

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SASSA’s Mandate

To ensure the provision of a comprehensive social security

service against vulnerability and poverty within the

constitutional and legislative framework.

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Vision

“To provide world-class social security services”

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Key Strategic Objectives

Ensure a High Performance Institution;

Service Delivery Improvement;

Improvement of Operational Excellence; and

Good Governance.

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PART TWO

Achievements against 2007-2010 Strategic Plan Priorities

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Achievements against 2007/8 MTEF Priorities Key achievements recorded during the 2007/8 financial year are outlined in terms of the six (6) MTEF priorities that were as follows:

Improving Service Delivery Quality;

Improving organizational capacity;

Improving Financial Management Capacity;

Improvement of payment services;

Enhancing Social Grants Process Integrity; and

Minimizing Fraud.

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1. Improving Service Delivery Quality Norms and standards are being implemented:

Standardised application process and forms implemented in all regions;

Improvements of various pay points; One day turn around times achieved in selected regions; and Accessibility increased through ICROP.

Customer Care Charter developed and translated into all official languages;

Standardised assessment guidelines for Disability grants developed and implemented in all regions;

Conceptual monitoring and evaluation framework developed and implemented;

Statistical monthly reports on grants produced and published in the SASSA’s website;

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1. Improving Service Delivery Quality Cont…

40 mobile units deployed in all regions;

Social Relief of Distress processes developed and implemented in all regions;

Partnerships were entered into with the following organisations to strengthen collaboration in different research areas: World Bank; UNICEF; SVB of Netherlands; City of New York (USA); Old Mutual; and United Nations Development Programme.

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1. Improving Service Delivery Quality Cont…

Communication strategy implemented;

Marketing and promotional material translated into all official languages;

Developed and rolled-out of new corporate identity for SASSA;

The review and implementation of an integrated marketing strategy for the Agency; and

The submission of the 2008/09 MTEF to the Department of Social Development on time, timely submission of the Estimate of National Expenditure, In-Year Monitoring reports.

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2. Improving Organizational Capacity:

543 posts filled which increased the staff complement by 8% (from 6985 to 7528);

Corporate governance structures such as EXCO, MANCO, Audit Committee, BID Committee and Financial Misconduct Board in place;

ICT related policies and IT systems developed and implemented;

Business and application architecture frameworks (Business Plan) for the grant administration system developed;

Knowledge Management strategy developed and implemented;

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2. Improving Organizational Capacity cont..

Partnerships entered into with World Bank, UNICEF, SVB, City of New York (USA) and UNDP to strengthen the collaboration in different research areas;

Two rapid assessment evaluation projects were conducted, namely: Quantitative analysis of the impact of the CSG; and Review of the CSG- uses, implementation and obstacles.

Micro and macro simulation models developed for budget planning for social security benefits;

Corporate governance framework developed and implemented;

Code of conduct and ethics developed;

Five (5) Audit Committee meetings held;

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2. Improving Organizational Capacity cont..

Database normalisation framework developed for 1st phase of SOCPEN enhancement;

95% availability of business systems achieved;

Various strategies in support of the broader Human Resource Strategy for the Agency were developed and implemented;

20 Human Capital Management policies developed and implemented;

National Bargaining Forum’s (SNBF) Constitution adopted by SASSA and organised labour;

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2. Improving Organizational Capacity cont..

A customised Performance Management and Development System for SASSA developed;

Auxiliary Support Services Strategy developed and implemented;

12 Auxiliary Support Services policies developed and implemented; and

Litigation and Contract Management Frameworks developed and implemented.

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3. Improving Financial Management Capacity

Financial Misconduct Board established and operational;

Deadlines for weekly, monthly, quarterly submissions on financial matters met;

Completed seven (7) ERP modules;

Deadlines for the MTEF and adjustment budget complied with; and

Key financial policies, procedure manuals and delegations developed and implemented.

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4. Improvement of payment services

The monitoring tool for checking compliance against norms and standards regarding the conditions of pay points was developed and rolled-out in eight (8) regions; and

Five (5) new pay points constructed in the Eastern Cape region.

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5. Enhancing Social Grants Process Integrity

MIS (workflow/tracking module) implemented in Eastern Cape and Free State regions;

Improved Grants Application Process (IGAP) is being piloted in Free State region;

The verification process strengthened through the implementation of IGAP in two regions, namely; Eastern Cape and Free State; and

A service provider appointed to analyse data to detect errors and irregularities in data through interfaces with other systems.

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6. Minimizing Fraud Over 1000 fraud hotline cases have been profiled and investigated;

4204 fraud cases investigated by SIU with 3625 convictions;

9391 Public servants signed acknowledgement of debts totaling R50,8 million;

118 655 terminations from the grants system recommended;

Fraud prevention and compliance plan is being implemented;

Draft Risk Management Strategy developed;

Strategic and operational risk register compiled;

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6. Minimizing Fraud cont..

Code of Conduct and Ethics was developed;

Fraud prevention strategy for the Agency developed and implemented;

Whistle-blowing policy being implemented;

Pre-employment screening of all new employees – particularly those in high risk positions;

Security and integrity vetting of all senior managers and targeted in high risk areas; and

SOCPEN database interfaced with PERSAL and GEPF.

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Part Three: Grants Statistics

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The total number of grant recipients increased by 403 255 (3.4%) in the 12 month period between March 2007 and March 2008; and

SASSA’s Key Achievements for 2007/08

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Growth trends by grant type between March 2007 and March 2008

Grant type Mar-07 Mar-08Number

IncreasedNumber

Decreased

Disabled 1 422 808 1 408 456 - -14 352

Grant-in-aid 31 918 37343 5 425 -

Old age 2 195 018 2 229 550 34 532 -

War Veteran 2 340 1924 - -416

Care Dependency 98 631 102 292 3 661 -

Child Support 7 863 841 8 189 975 326 134 -

Foster Care 400 503 454199 53 696 -

Total 11 983 141 12 386 396 423 448 14 768

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Growth trends by grant type between March 2007 and March 2008

This table shows the distribution of grant recipients by grant type between March 2007 and March 2008;

The total number of grant recipients increased by 403 255 in the 12- month period between March 2007 and March 2008; and

The number of recipients of the disability grant declined by 14 352 and that of the war veteran grant by 416.

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PART FOUR

Budget and Expenditure for 2007/08

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Budget per economic classification

  2007/08 2006/07

        Expenditure    

Economic Classification Adjusted Final Actual   as % of final Budget

Final Actual

  Budget Budget Expenditure

Variance   Budget expenditure

  R'000 R'000 R'000 R'000 % R'000 R'000

Current payments              

Compensation of employees 1 120 930 1 120 930 1 079 723 41 207 96.3 881 007 710 684

Goods and services 3 288 608 3 288 608 3 360 993 -72 385 102.2 3 009 748 2 944 881

Transfers and subsidies - - - - - - -

Provinces and municipalities 106 106 115 -9 108.5 321 490

Departmental agencies and accounts

- - - - -    

Non-profit institutions - - - - - 7 -

Households 616 616 1 157 -541 187.8 365 936

Payments for capital assets

- - - - - - -

Buildings and other fixed structures

  - - - - 100 100 100 100

Machinery and equipment 104 035 104 035 107 847 -3 812 103.7 174 774 57 120

Software and other intangible assets

2 919 2 919 1 038 1 881 35.6 26 049 4 962

Total 4 517 214 4 517 214

4 550 873 -33 659 100.7 4 192 371 3 819 173

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Expenditure narratives/analysis

Compensation of Employees:

Budget was R1 120 930 billion; Expenditure amounted to 1 079 billion (which is 96.3%); Key management positions were filled at both Head Office and Regions however the Agency is still faced with a

challenge of filling lower position particularly areas where service delivery is happening such as pay points, truck drivers, support service etc.

Goods and Services:

Budget was R3 288 608 billion; Expenditure amounted to R3 360 billion (which is 102.2 %); Over spending on this line item is due to:

- significant growth in terms of the beneficiaries eligible for social assistance grants.- price increase due to third party payment contractors arising from Service Level

Agreement.

Payments for capital assets :

Budget machinery and equipment was R104 035 million; Expenditure amounted to R107 847 million (which is 103.7 %); The over-expenditure is mainly attributed to the procurement of 40 mobile trucks to enhance service delivery and

ensure that beneficiaries do not walk long distance to access the services which the Agency is rendering.

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PART FIVE

Auditor-General’s Report and Comments

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Report of the Auditor-General

Basis for unqualified opinion:

The financial statements and its financial performance and cash flows have been prepared, in all material respects, in accordance with the basis of accounting as set out in accounting policy note 1 and in the manner required by the PFMA; and

No significant findings have been identified as a result of the audit conducted on the performance information.

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PART SIXChallenges and Concluding Remarks on

2007/08 financial year

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Challenges Recruitment and retention of ICT staff;

Inadequate funding of critical ICT projects and Lack of appropriate infrastructure;

Delays in finalisation of Regulations to the Social Assistance Act;

Increasing accessibility of services: rural and semi-rural;

Finalisation of the National Contact centre;

Service Delivery Model not in place;

Finalisation of litigation cases; and

Timeous detection and prevention of fraud and error in the grants administration process.

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Concluding Remarks

SASSA has recorded significant progress during the year under review in all 9 regions as evident in the Auditor-General’s audit findings; and

There are still a number of challenges that need to be addressed regarding systems, processes and realistic resourcing of the plans.

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