HEARINGS ON ANNUAL REPORT

1. HEARINGS ON ANNUAL REPORT PRESENTATION TO PORTFOLIO COMMITTEE 19 October 2005

2. OUTLINE • VISION & MISSION • INTRODUCTION • STRATEGIC OVERVIEW & KEY POLICY DEVELOPMENTS • HIGHLIGHTS ON 2004/05 ACHIEVEMENTS • BRANCH: SOCIAL SECURITY • BRANCH: INTEGRATED DEVELOPMENT • FINANCIAL PERFOMANCE • OVERVIEW OF FINANCIAL RESULTS • AUDIT OPINION • CONCLUSION

3. VISION & MISSION • VISION A caring and integrated system of social development services that facilitates human development and improves the quality of life. • MISSION To ensure the provision of comprehensive social protection services against vulnerability and poverty within the constitutional and legislative framework, and create an enabling environment for sustainable development. The department further aims to deliver integrated, sustainable and quality services in partnership with all those committed to building a caring society.

4. Introduction • In the year under review we endeavoured to give effect to our vision and mission through addressing the complexities and the multiple dimensions of poverty by: • Extending social grants to the most needy including children, older persons, disabled persons and other vulnerable groups; • Focusing on finalising the legislative and policy frameworks that govern our operations through new policies andlegislation which include the Older Persons’ and Children’s Bills; • Restructuring and re-strategising to gear the Department for a new role in expanding welfare and developmental services; and • Contributing to work of the Clusters of government, as a co-chair, to ensure the delivery of Cabinet priorities

5. Introduction • The success of our endeavours are reflected in that we: • Expanded our capacity and delivered on our international obligations; • Provided the requisite leadership to the provincial departments; • Registered over 1,3 million beneficiaries; • Improved the effectiveness and efficiency of the grants system; • Effectively started to eliminate fraud, corruption and improved targeting; • Introduced critical pieces of legislation into Parliament; • Completed the financing model for welfare funding, • Developed a new service delivery model for welfare and developmental services; • Expanded care & support to people affected & infected by HIV & Aids; • Enhanced capacity of the Population Unit to provide research support; and • Coordinated development of comprehensive social security system; • The following slides provide the details of these initiatives

6. Strategic overview & key policy developments • Overview of service delivery environment • Poverty & unemployment continues to challenge the social development sector • Consequently, social assistance continues to dominate our budgets and spending trends • Crowd out effect on other social developmental services • Fraud & corruption on social grants continue to challenge the department despite efforts to eradicate it

7. Strategic overview & key policy developments • Overview of service delivery environment-cont • Impact of HIV & AIDS & other social ills demand that focus shift from social grants to social welfare & other developmental services • Support given to NGOs is still fragmented & unpredictable • Exodus of social services professionals, specifically social workers, to other professions & other countries continues unabated • Disparity in conditions of employment of social workers in government and those in NGO sector is a major challenge

8. Strategic overview & key policy developments • Overview of organisational environment- cont • The centralisation of the social assistance function presents an opportunity for the restructuring national & provincial departments & re-directing of focus to other social development services • Both national & provincial departments continue to have capacity challenges • Current number of social workers is insufficient to deal with the social challenges resulting from poverty, unemployment and HIV and AIDS

9. Strategic overview & key policy developments • Response to challenges • A new social development service delivery model has been developed • A retention strategy for social services professionals has been crafted • Salaries of social workers in public service have been reviewed & plans are put together to deal with the NGO sector as well • The new financial awards policy aims to address the funding of NGOs & other service providers • Fraud strategy for social grants is beginning to pay dividends in all provinces and an overall savings is projected by end of year.

10. Key policy developments • Integrated development • Service delivery model & financial awards policy • Children’s & Older Person’s Bills in pipeline • Minimum standards for in-patient drug treatment centres approved • Draft policy on substance abuse • Comprehensive review of drug master plan underway • The process of reviewing the prevention and treatment of Drug Dependency Act No 20 of 1992 has commenced

11. Key policy developments-cont • Integrated development-cont • Draft policy on victim empowerment & victim’s charter • Draft policy framework for orphans & vulnerable children • Draft Policy Framework and Strategy on Child Abuse, Neglect and Exploitation completed • ECD guidelines finalised

12. Integrated development-cont • The Child Protection Register (CPR) has been installed in seven provinces and the process of upgrading and installing database is ongoing. • Draft policy for people with disabilities as well as draft integrated policy for the transformation of protective workshops have been developed

13. Key policy developments-cont Social Security: • A position formulated on responding to age equalisation of old agegrant • Research and proposals on deductions from social grants was completed • The demographic and financial model for social security grants was updated in line with Census 2001 data. • Completed a detailed study on socio-economic impact of social grants • We could not complete work on: • Research into needs of the disabled; • Relationship between grants and private insurance; • Spatial analysis of social grants impact, especially on females; • Spatial and individual panel survey of impact of social grants • Limited staff capacity & agency work detracted from some of these initiatives

14. Social Security Achievements Grants Administration • Design application, verification and approval processes • Norms & standards blueprint implementation plans completed, but reduction of cycle times delayed due to limited human resources – could not implement 1:800 staff to beneficiary ratio. • Reviews of disability grants progressed with over 180 000 completed, savings in excess of R200 million, however delays in KZN, Mpumalanga and Limpopo; • Child Support Grant reviews behind schedule as focus was on disability • Some success in reviews of foster care as grants are now lapsed at end of financial year

15. Social Security Achievements • Integrity improvement plans implementing data detection of fraud • Extension of 9 and 10 yrs at 98% of success rate • Coverage of eligible persons over 90% complete for all grants • A total of 9,4 million beneficiaries were in receipt of grant as at March 2005. About 1,4 million increase in coverage • Compliance with conditional grant framework achieved • R3,2 billion transferred to provinces as conditional grant for CSG • eligibility criteria & conditions for grant uniformin all provinces • The main challenges were: • lack of dedicated capacity to implement project at National & Provinces • Lack of required birth certificates for registration of children

16. Social Security Achievements Grants Information and Payments Systems • Process to replace system deferred pending finalisation of the transformation processes incl Agency establishment • Maintenance of IT systems not sufficiently improved as limited capacity resides in the department • Implementation of data clean-up initiated • Socpen enhancements being carried out on an ongoing basis • System accessibility and availability significantly increased through technology roll out

17. Social Security Achievements Service Delivery Infrastructure • A spatial distribution model for pay points completed, implication is that the department now has a plan for the set up of pay points, • Shift occurred in use of financial institutions from target of 20% exceeded by 1%. The cost saving is significant as 2 million people now use banks and Post Office, saving millions of Rands per annum • Over 30% of pay points meet all the norms and standards – this could be more as the audit was a sample • Next phase in the office distribution model

18. Social Security Achievements Disaster Relief • Time taken to assess disasters within 48 hrs • 70% of applications processed within 3 months and payments • Blue prints developed for processing applications to reduce time taken • Institutional reform necessary for disaster relief given the matters of accountability- • Draft Bill has been developed - awaiting inputs and tabling • In the meantime the Department has developed policies for distribution of emergency relief provision

19. Social Security Achievements Agency establishment • Cabinet approved implementation plan and blue print of the shape and form of the institution • Legislation in place and institution now a legal entity • Staff employed in support functions & national imple-mentation coordinating body set-up as Guiding coalition • Enhanced strategic management capacity in the Department • A Memorandum of Understanding was signed between the Minister and the MEC’s towards the end of financial year • In terms of the targets, the Department is on course

20. Social Security Achievements Service Monitoring and Evaluation • The Department has a fully fledged M&E system with extensive measuring system covering over 10 Key Performance Areas and 110 Key Performance Indicators • A comprehensive reporton the quality of servicedeliveryat anational and provincial was compiled, as well as monthly and quarterly monitoringreports are produced. • Value for money was assessed through assessing theimpact of SocialSecurity grants onthe lives of thebeneficiaries. • Work was undertaken to establish evidencebase for thedevelopment ofpro-poor socialpolicy in partnership with DFID with donor funding of over R40 million

21. Social Security Achievements Compliance: Fraud Prevention and detection • Capacity greatly enhanced in the Compliance Unit • Data interrogation done in 9 provinces and detected fraud, including that of over 41 000 civil servants. • Fraud hotline was launched, reporting over 15 000 cases. • Indemnity offer made to the public with over 86 000 responding, savings estimated at over R400 million • Department partnered with SIU to deploy over 200 investigation experts over next two years • Reviewed 150 000 cases of temporary disability saving R200 million

22. Overall Social Security Gains • Setting up the Agency limited our efforts to ensure implementation of all commitments made • Within social security policies, good work has been done despite some targets not achieved • Within grants administration, delivery targets achieved, especially on registration of those eligible for grants • On service assurance objectives significant gains were made in monitoring and evaluation, but more especially within the area of detection and reduction of fraud

23. Integrated Development Achievements • The SA Council for Social Services Professions as well as the Professional Boards for Social Work and Child and Youth Care have been reconstituted and are now representative of the demographics of the country. • The national conference for Social Services Professions was held in partnership with the Council. • Ke Moja Project which is a drug abuse prevention programme targeting the youth was launched in the Western Cape

24. Integrated Development Achievements • Service Providers in two provinces trained on management of substance abuse • Youth best practice treatment model for substance abuse developed and consulted in the provinces • Guidelines for transformation of services to older persons have been finalised and are being printed for distribution. • Frail Care guidelines developed and consulted awaiting approval. • A SA Plan of Action on Ageing is currently being developed. • The department jointly with SAMDI has developed a capacity building programme on disability issues for managers

25. Integrated Development Achievements • The Department participated in the development of a draft integrated ECD strategy in collaboration with the DOE and DOH. • 124 Inter-country adoptions registered • The department is implementing the Probation Services Act No 116 of 1991 as amended. • 1000 children have benefited from the home-based supervision programs • 750 Probation Officers received training in restorative justice and probation principles • 76 Assistant Probation officers received in-service training

26. Integrated Development Achievements • New Secure care facilities in GP, WC, EC and KZN completed to be operational during 2005/6 • Standard Generating Body has been gazetted and will begin its work in 2005/5 • A curriculum for the 2 year Assistant Probation Officers’ training course – first of its kind in SA- completed in October 2004 • More than 30 000 children diverted from the criminal justice system.

27. Integrated Development Achievements Service Delivery Implementation • The Department’s participation in the Integrated Justice System Program resulted in the removal of 300 children from DCS, SAPS and DOSD facilities into alternative care programmes • Various youth development initiatives and outreach programmes implemented by the dept. These include Youth Month roundtable discussions, Youth Day Commemorations, National Volunteer Week, take a girl child to work campaign

28. Integrated Development Achievements • Commemoration of the 10th anniversary of the international year of the family. • Research on families in South Africa completed in Dec 2004 • VEP minimum standards for Integrated Service Delivery approved and distributed to stakeholders • A National Resource Directory on Services for victims of violence has been distributed to provinces and other role players • 16 Days of no violence against women launched in Bizana • 150 Soc Dev Professionals trained on SA Charter for victims of violence • 3rd draft of theintegrated strategy on Victim Empowerment has beendeveloped • An impact assessment of Victim Empowerment was carried out and a tool to monitor the projects was also developed.

29. Integrated Development Achievements • Draft community development contextual document promoting the understanding of the concept and facilitating the process of mainstreaming the community development approach has been completed. • The Department with technical assistance from DFID and EU has developed the social sector plan for the institutionalization of EPWP. • Curriculum for the National Certificate in development practice was developed in partnership with DPLG.

30. The Department facilitated the collation of the country report on the Copenhagen report which served as guidelines for discussion in the 43rd Session of the Commission for Social Development in New York. • The study on the assessment of the impact of the NPO Act on the sector was undertaken and completed. • 6 830 NPOs registered and issued certificates during the year under review • 11 169 new applications received and processed

31. Integrated Development Achievements • Capacity building programme for NGOs an CBO responsible for HCBC and support has been established with support from DFID • LoveLife Groundbreaker partnership programme has been expanded to include farms and the informal settlements and it has been linked to the EPWP in relation to HCBC and Support. 80 groundbreakers trained and placed in community based centres. • HIV and AIDS training programme for govt policy makers and planners reviewed and implemented

32. Integrated Development Achievements • 57 community based multipurpose centres have been established and funded • 352 organizations have been funded during the year under review • 6976 care givers have been trained • 107 child care forums established • Research on the monitoring of the HCBC projects, in collaboration with the DOH has been finalized

33. Integrated Development: Challenges • Delay in the finalization of the NFES tender process and the decision on the continuity of the programme impacted negatively on the implementation of the programme • Backlog of the registration of the NPOs • Capacity to do Monitoring and evaluation of programmes • Lack of service standards/norms standards which results in lack of uniformity in the delivery of services. • Limited human resource capacity

34. Financial Performance • Department continues to put effective controls to improve financial management • Implemented the new supply chain management (SCM) policy • Restructured the finance unit in response to social assistance function shift & SCM • In-year monitoring instruments developed for conditional grants • Audit Committee & Internal Audit Unit continue to add value towards achievement of objectives • Department spent 98% (R4, 513 billion of the total adjusted allocation of R4, 598 billion

35. Financial Performance • Major underspending was on Programme 3: Grant Administration mainly due to: • Funds for social security improvement received only in November 2004 in the adjustment budget and limited period available for provinces to put up plans to implement “Operation Isidima” as it is called. • The phasing out of the establishment of the Agency over 3 years as opposed to fully operational entity by 1 April 2005

36. Findings of the Auditor-General • Once again department received an unqualified audit opinion • Emphasis of matter on the following: • Non- compliance with DoRA • Underspending on conditional grants • Insufficient project management controls on Poverty Alleviation funds held at IDT • Non-compliance with NPO Act, 1997 • Short-comings in the SOCPEN system

37. Management responses to AG • Non- compliance with DoRA • The capacity of the Department is being enhanced starting with finance unit • Conditional grants put on the agenda of HSD and CFO meetings • Agreed to give regular quarterly feedback to MINMEC • Quarterly reports now submitted to Treasury & Select Committee in NCOP • Overall capacity in provinces remains a big challenge

38. Management responses to AG • Underspending on conditional grants • Major underspending was in EC & Free State on CSG • National targets set are being reviewed in line with 2001 census data • Collaboration with Home Affairs & Justice is beginning to show improvements • Other underspending in Food Emergency Grant • Tender processes finalised in 6 provinces before year-end and EC, KZN & WC now finalised in new year • Programme terminated due to non-sustainability & complexity

39. Management responses to AG • Insufficient project management controls on Poverty Alleviation funds held at IDT • Discussions held with IDT and agreed on exit plan which will ensure, amongst others, the spending of remaining funds • Financially & economically viable projects will be migrated to SMME projects, in collaboration with DTI • Impact assessment to be finalised before end of the year • Non-compliance with NPO Act, 1997 • Research study done on impact of the Act • Future strategy to manage NPOs will be recommended to Minister soon

40. Management responses to AG • Short-comings in the SOCPEN system • Department is already, as part of the SOCPEN enhancement strategy, working with SITA to deal with the shortcomings identified by the Auditor-General, including the development of a disaster recovery plan

41. CONCLUSION • Poverty and HIV & AIDS continue impose challenges for the sector • Integrated approach with other departments & other stakeholders, especially NGOs & FBOs is critical • Proactive and preventative steps are very critical in dealing with these challenges • Capacity of the government to respond to social challenges need to be given priority attention • Partnerships with private sector and NGOs are critical success factors

42. THANK YOU