ATC200713: Report of the Select Committee on Health and Social Services on the Budget Vote 19 of the Department of Social Development; dated 13 July 2020

NCOP Health and Social Services

REPORT OF THE SELECT COMMITTEE ON HEALTH AND SOCIAL SERVICES ON THE BUDGET VOTE 19 OF THE DEPARTMENT OF SOCIAL DEVELOPMENT; DATED 13 JULY 2020

 

The Select Committee on Health and Social Services (henceforth, the Committee)having considered and deliberated on the adjusted budget of Department of Social Development (henceforth, the Department) together with the Portfolio Committee on Social Development at a meeting held virtually on 8 July 2020, reports as follows:

 

1. Introduction

 

On 15 March 2020, President Cyril Ramaphosa declared the coronavirus (COVID-19) a national disaster in terms of the Disaster Management Act (No. 57 of 2002) and implemented a number of measures and protocols aimed at prevention and mitigation of the spread of the disease.

 

On 15 April 2020, the President announced a R500 billion (equivalent to $26bn) stimulus package to deal with the devastating economic impact of COVID-19. The President indicated that funding would be sourced through the Adjustment Budget, the Unemployment Insurance Fund (UIF) and loans from multilateral institutions such as the World Bank and the International Monetary Fund (IMF).

 

On 30 April 2020, the National Treasury published a report titled “Economic Measures for COVID-19”, detailing the R500 billion response, as well as identifying the funding sources for the package. Part of the funding sources for this package is a R130 billion-baseline reprioritization in the 2020/21 financial year.

 

Subsequently, the Minister of Finance tabled the special adjustment budget on 24 June 2020. The adjusted budget sets out government’s initial economic and fiscal response to COVID-19. It is meant to fast-track normal processes to provide resources to frontline services, provincial and local government, and firms and households, with a focus on the most vulnerable South Africans. It also underlines government’s commitment to stabilise the public finances and enact reforms that will promote trade, investment and job creation.

 

1. Implications of the COVID-19 Pandemic on the mandate of the Department

 

The COVID-19 pandemic required the South African Government to urgently implement measures to respond to the negative economic and social impact on the lives of citizens. The Department as part of the social cluster of Government had to develop measures to address the social impact of the pandemic. These entail increased levels of poverty (food insecurity), an increase in gender-based violence and Femicide (GBVF) cases during lockdown, and sheltering for homeless people. The other impact that the Department needed to respond to, even though it is economical in nature, related to loss of income particularly in the informal economy. Relief of hunger and social distress, access to healthcare, income, water and sanitation have become the key priorities of Government during this time.

 

Box 1 indicates the levels of impact the pandemic has had on the work of the Department.

 

Box 1: Department Response to COVID-19

Scaling up programmes   The Department had to urgently formulate measures to scale up its programmes and services on food security, GBVF services, and the sheltering of homeless people towards the end of the 2019/20 financial year. The Department had to make available an emergency budget, despite some provincial budgets for 2019/2020 financial year having been already depleted. This has occurred during a period when sector Strategic and Annual Performance Plans (APPs), as well as the Budget for 2020/2021 financial year were yet to be approved by Parliament.   Human resources   The Department had to urgently mobilize its human resources, particularly Social Workers who were already over stretched. Further, the Department needed to secure additional funding to employ about 1 809 Social Workers on a temporary basis (for 3 months). Going forward it may be useful for the Department to consistently update and assess its database of trained Social Workers, and auxiliary workers.   The Department through the National Development Agency (NDA) and the South Africa Council for Social Services Professions (SACSSP) made human and financial resources available. An amount of R1.8 million was allocated by the NDA to partnerwith 52 Civil Society Organisations (CSOs) who provided 10 volunteers each, amounting to 520 volunteers.   The SACSSP in partnership with the Health and Welfare Sector Education and Training Authority (HWSETA) mobilized R16 million for training of social service professionals (SSPs) on psycho social support interventions, disaster management, trauma counselling. The SSPs would include unemployed graduates.   Accessibility   While the South African Social Security Agency (SASSA) made significant strides in automating its processes, these were mainly targeted at automating business systems. That is, application processes, electronic filing and reporting. The lockdown regulations required that SASSA and the Department urgently develop electronic application forms, which applicants can access from their mobile devices or internet. SASSA had already set this as its target for 2020/2021 financial year. However, these systems are introduced in a country with communities that have limited access to the internet.   Economic implications To curb the deepening loss of income, which resulted in, increased poverty and food insecurity, particularly for people in the informal economy, President Ramaphosa on 22 April 2020 announced for the provision of a six months Social Relief of Distress (SRD) Grant. A total budget of R50 billion was made available for this. This provided for an increase of R300 in the Child Support Grant (CSG) for the month of May, R250 increase to other grants for a period of 6 months, and a R500 grant to Caregivers of children receiving the CSG. It also provided for an additional SRD grant of R350 a month for 6 months for the unemployed who do not receive any other form of grant or Unemployment Insurance Fund (UIF). This announcement required the Department and SASSA to develop systems and guidelines needed to implement these grants within days.

 

1. Analysis of the Adjusted Budget byProgramme

 

Table 1 indicates that the Department of Social Development was affected by the National Treasury decision to raise additional budget for COVID-19 related spending priorities. It should be noted that SASSA and the NDA depend on transfers from the DSD. Other Government Departments saw their budget baseline reduced and programmes re-prioritised.

 

Table 1: Adjusted budget of the Department of Social Development, 2020/21

Rand’ 000	2020/21 Main budget	DOWNWARD REVISIONS			REALLOCATIONS
		**Suspension of funds	**Virements	Virements from (other)	Allocation **	**Virements	Virements to (other)	2020/21 Total net change proposed	2020/21 Total allocation proposed
Programmes
1.Administration	426 660	–	-13 000	–	–	23 000	–	10 000	436 660
2.Social Assistance	187 835 779	-15 417 402	–	–	40 891 284	–	–	25 473 882	213 309 661
3.Social Security Policy and Administration	7 831 970	–	-5 500	–	–	–	–	-5 500	7 826 470
4.Welfare Services Policy Development and Implementation Support	1 256 698	-64 500	-27 500	–	64 500	33 000	–	5 500	1 262 198
5.Social Policy and Integrated Service Delivery	367 168	–	-10 000	–	–	–	–	-10 000	357 168
Total	197 718 275	-15 481 902	-56 000	–	40 955 784	56 000	–	25 473 882	223 192 157

**for COVID-19 purposes

 

As can be seen on Table 1, the R15.48 billion of the Department’s baseline allocation was suspended for COVID-19 related purposes. However, it was reallocated an amount of R40.96 billion to fund COVID-19 spending priorities. Overall, its baseline allocation increased from R197.72 billion (main appropriation) to R223.19 billion. The annual budget of the Department was, therefore, adjusted upwards for the 2020/21 financial year. The budget for the Department shows a real increase of 8.13% when the inflation rate of 4.6% is factored.

 

Adjustments were effected to the following economic classification categories:

• Transfers and subsidies were adjusted with R25.47 billion, from R196.77 billion (April 2020) to R222.24 billion (June 2020). This additional allocation is directed towards households in order to top-up for social grants for a specific period, as well as a special COVID-19 social relief of distress grant of R350.

 

• A virement to the value of R33 million was made towards compensation of employees (COE). The budget of the COE increases from R537.86 million to R570.86 million. This is to fund the hiring of 1 809 social workers to provide psychosocial services to affected people during the pandemic. The social workers will be paid a stipend of R6 000 per month for a period of three months.

 

*The Portfolio Committee on Social Development report provides detailed analysis of the adjusted budgets and plans of the Department’s entities: SASSA and NDA.

 

Table 2: Revised annual targets of the Department of Social Development for 2020/21

DEPARTMENT ANNUAL TARGETS	NUMBER OF TARGETS
Original targets (April 2020)	62
Added/deleted targets	-3
Revised targets (June 2020)	59

 

Table 2 shows that the Department of Social Development had initially planned to achieve 62 targets but due to changes brought by the pandemic, it reduced its targets to 59. This means that the Department removed 3 targets from the initial planned targets at the beginning of the year.

 

Some of the key targets adjustments made per Department programme include the following:

 

• Programme 1 (Administration):Two COVID-19 related targets were added to this programme. The Department plans to develop an electronic M&E System for the social sector, to collect real time data that feeds into a dashboard that tracks, monitors and reports on the COVID-19 related services and beyond. Further, the Department is planning to conduct three rapid assessment studies on the implementation and utilization of the R350 COVID-19 SRD Grant, the impact of COVID-19 lockdown on child well-being in South Africa, and social sector’s response to Food Relief Mechanisms during COVID-19.

                     

• Programme 2 (Social Assistance):The original target was to pay social grants for eligible individuals to the value of R175.1 billion. However, due to COVID-19 the amount of payment has been increased to R200.6 billion. The increase is in line with top-ups on social grants and the R350 COVID-19 grant. A total of R40 billion was added to augment the social grants budget.

 

• Programme 3 (Social Security Policy and Administration): This programme is tasked to provide for social security policy development, administrative justice, the administration of social grants, and the reduction of incorrect benefits payments. As of June 202o, seven targets are set for this programme.  Two targets were deleted and one was added. The added target is to draft a policy proposal to revise the Basic Income Grant (BIG) for unemployed people aged 18-59 years old.

 

• Programme 4 (Welfare Services Policy Development and Implementation Support): This programme has a total of 25 (originally 26 targets) as of June 2020. Three targets were deleted and two were added. The added targets involve facilitation of the re-opening of the early childhood development (ECD) programme, and developing a database of ECD programmes.

 

• Programme5 (Social Policy and Integrated Service Delivery): This programme had 20 targets which were revised to 18, with four deleted and two added. The new targets entail 10 000+ youth participating in the sexual and reproductive health and rights online advocacycampaign (Siyakwazi Youth Network in 52 Districts), and producing a research survey report on youth perceptions on the socio-economic, health and gender impact of the COVID-19 pandemic.

 

 

1. Observations and Findings

 

1. Budget-related observations

 

• The Committee noted with concern that National Treasury did not allocate additional funds for critical social welfare programmes, such as the ECD, family preservation and psychosocial support or GBVF and anti-substance abuse programmes. Most concerning was the fact that funds had to be shifted from the budget initially allocated for ECD infrastructure upgrades to purchase Covid-19 essential supplies for ECD centres. Budget cuts also affected funds originally allocated to implement the universal treatment curriculum and substance abuse forums.

 

• The Committee noted that there is a need for the national and provincial departments to account to Parliament on their expenditure, in relation to funds allocated to the GBVF programmes.

 

1. Performance-related observations

 

• The Committee reiterated the concern over the challenges that continue to be experienced in the processing of the SRD grant applications. These include the high backlog of applications, delays in responses to applications and payments to those approved, high number of declined applications, confusion created by SASSA’s responses to applicants and overcrowding at SASSA offices. Electronic devices and internet are required to apply for the grant and yet may not be easily accessible to everyone in need, especially people living in the rural areas. They rely on in-person applications at SASSA offices which operate with limited staff.

 

• The Committee noted that the Department’s Annual Performance Plan did not include targets on the employment of additional 1 809 Social Workers.

 

• The Committee also noted with concern that the target to train and capacitate 500 social workers was revised to 180 Social Workers when there is a great need for social work services. The Department was asked what plan it has put in place to ensure that all Social Workers are adequately capacitated. 

 

• Further, the Committee was concerned aboutcritical posts being vacant at the Department when Government is preparing for budget adjustments in October 2020 through the Medium Term Budget Policy Statement (MTBPS).  

 

1. Recommendations

 

Having considered the revised annual performance plans and budgets of the Department and entities, the Committee made the following recommendations:

 

• Backlogs in payment of SRD grant: The Minister should ensure that the backlog on outstanding COVID-19 SRD payments is cleared.

 

• Support post-lockdown: The Minister should ensure that the Department develops concrete strategies of how it will continue to assist people after the interim three months’ assistance has lapsed, especially rural communities.

 

• Social service human resources: The Minister should ensure that theDepartment finds mechanisms of retaining the temporary hired Social Workers, and recruits more Social Workers.

 

• The scourge of violence: The Minister should ensure that the Department’s plans clearly set out targets aimed at addressing GBVF and, violence and murder of children. The Department should engage with the Presidency and National Treasury to look into how more funding can be allocated to address GBVF, violence and murder of children, substance abuse and family preservation programmes.

 

• Support for ECD services: The Minister should ensure that the Department provides the necessary support to ECD centres, and ensure that they comply to COVID-19 safety regulations.  

 

• Governance and accountability: The Minister should ensure that there is strengthened governance and accountability within the Department and entities.

 

• Monitoring of funds: The Minister should ensure that the Department establishes a system to monitor the use of funds that have been allocated for programmes related to poverty alleviation, homelessness, drug abuse and violence related to women and children. 

 

1. Conclusion

 

Overall, the Committee was concerned about the funding allocated to the social development sector for COVID-19 purposes, in light of the challenges faced by people on the ground. However, the Department was commended for its efforts to alleviate poverty and strengthen its COVID-19 response.

 

Unless otherwise indicated, the Department should respond to the Committee’s recommendations in three months, from the day the report is adopted in the House.

 

Report to be considered.