Social Assistance Bill and the South African Social Security Agency Bill: deliberations

Meeting report

SOCIAL DEVELOPMENT PORTFOLIO COMMITTEE
7 October 2003
SOCIAL ASSISTANCE BILL AND THE SOUTH AFRICAN SOCIAL SECURITY AGENCY BILL: DELIBERATIONS

Chairperson: Mr E Saloojee

Relevant documents:
The Social Assistance Bill (B57-2003)
The Social Security Agency Bill (B51-2003)
The Social Assistance Bill (Third Draft dated 17 September 2003)
Summary of Public Hearings Submissions on the Social Security Agency Bill
Summary of Public Hearings Submissions on the Social Assistance Bill

SUMMARY
The Committee deliberated on the 3^rd draft of the Social Security Agency Bill and the summary of related public hearings submissions. Officials from the Department and Treasury provided input on Members' queries regarding the amendments.

MINUTES
The Social Security Agency Bill
Mr F Makuwane (Department) said that the submissions from NEHAWU and COSATU contextualised the fragmentation of social security and inequity of access. Accenture broadly supported the Agency process. The Alliance for Children's Entitlement to Social Security (Acess) identified the need to expand the safety net by addressing both policy and administrative issues. The Coalition on Social Assistance recognised problems and called for the expansion of cover for children up to the age of 18 years, elaboration of the definition of "disability grant" and cover for child-headed households. The submissions had made it clear there should be a focus on centralising the administration of social assistance.

Ms G Borman (DA) referred to page 2 of the submissions document, saying that the trend in submissions was that it was that the Committee should reconsider the Agency Bill. She asked why the Committee was pushing ahead despite this sentiment.

Ms N Ramotsamai (ANC) said that submissions simply presented the organisations' views and did not imply that the Committee should not continue discussions. The intention was that the Committee made comments on the views expressed and that the Department in turn to make recommendations. The Chairperson agreed.

Ms I Mars (IFP) said that the implication was that no meaningful engagement had taken place. She asked Department officials whether this was the case.

Mr Makuwane said the submissions confirmed that there had been engagements since February 2003 around the Bills. The consultation process was now taken further with meeting with the Committee.

Mr M Da Camara (DA) referred to page 1 of the Submissions document and commented that Acess recommended that the Bill be rejected because policy development had not been fully completed. The Taylor Committee recommendations had also not been taken into account. He asked the Department whether the policies would be in place once the Agency had been established.

Mr Makuwane stated that current policy around social assistance had not changed. The Agency would come into effect to counter problems experienced with delivery. The Department should not suggest that administrative issues would not be addressed because they awaited the relevant policies to be formulated by Government. The Taylor Committee was the work of the Government. The debate around the Bills was different to that of policy debates in the Department's understanding.

Advocate M Masutha (ANC) said that the idea of a comprehensive social security system envisaged an integrated package with an integrated delivery instrument or system. A policy framework could be formulated to integrate the different forms of provision but it was essential that there be an appropriate delivery vehicle. The matter should not be laboured any further. The Agency would eventually assume the delivery function of the entire comprehensive social security system in the long term.

Ms Ramotsamai said that the Committee should confine itself to the administration of the Agency. She asked for the Department's comment on the COSATU recommendation concerning the long title of the Bill.

Mr Makuwane answered that the Agency would be responsible for the administration and payment of social grants, but not in the short term. The Agency would also go into private partnerships to ensure that it delivered on its mandate and built capacity. In terms of the wording proposed by COSATU and NEHAWU to indicate that the Agency would be the sole entity administering and paying grants, the Department saw no problem. The word "sole" would then be incorporated with the help of the legal advisors.

Mr Da Camara pointed out that the Bill was tailored for current and not future policy. The Committee should not proceed with the Bill.

Ms N Tsheole asked whether the word "eventually" should be inserted so that the Agency was not constrained.

Clause 3
Ms Borman referred to the comment by Action on Elder Abuse. She asked whether service delivery would be improved with the relocation of staff to the national Agency. Accenture had proposed that there be new and more professional staff.

Ms Ramotsamai reiterated Action on Elder Abuse's query on how beneficiaries would be protected within the context of the Bill. Organised workers were also affected. She asked how their decisions would be balanced with what organised workers recommended.

Advocate Masutha referred to two comments on the definition of "social security". COSATU recommended that the word "private" be deleted from the definition, while Professor Olivier from Rand Afrikaans University was critical of the composition of the definition. The reference to "private" might be unwarranted because the Agency was a public institution. Private arrangements would only be appropriate once the Agency became part of the integrated public package. Problems would arise with a public entity making private provisions. There might be merit in Professor Olivier's comments that there was either an element of duplication or certain components have been left out. He asked whether it was important for the term "social security" to be defined as the concern was only around social assistance. An inaccurate definition could cause further problems.

Mr Makuwane said it would best to simply refer to forms of social assistance rather than social security. The definition gave an indication of what social security could include. There was no uniform agreement on the term "social security". If the definition changed in terms of social policy, there would be changes. The Committee should provide guidance on whether "social assistance Agency" should replace "social security Agency".

Ms Tsheole said that the Department should indicate implications of these changes.

Ms Borman asked whether other categories apart from social assistance would be included at a later stage.

Mr Makuwane referred to the issue of protection of older people, saying that within the ambit of social assistance, there were provisions for this. These were deliberately added by the Committee to ensure that older persons' rights were protected. The Committee should indicate whether these provisions should be expanded. The Older Persons Bill also made provision in these terms.

Mr Da Camara said that loopholes still existed. The Agency centralised administration, therefore removing the processes of appeal and related mechanisms from the public.

Mr S Jehoma admitted that this was a shortcoming. In terms of the Bill, the idea of the tribunal should be reconsidered. Within the new set of regulations, provision would be made for those wanting to engage in the appeal process. More information on the current procedure could also made available.

Ms Borman mentioned the hand-over time and the interim period. She referred to Age-in-Action's concern that there was no timeframe stipulated for the hand-over period, and this could be to the detriment of beneficiaries.

Mr Makuwane said that this issue could be reviewed when considering transitional measures.

Advocate Masutha said that, between the formulation of clause 3 and the long title, there seemed to be inconsistent use of language. Clause 3 mentioned the "efficient management, administration and payment of social security". The long title read "consideration and payment of the main purpose of the Act was to create the Agency.

Clause 4
The key elements of the Social Assistance Bill related to the executive function of Government to ensure that resources were available. The other element was the administration of the delivery of social assistance. "Administration" would include as limited to the administrative part. Administration could include payment as being done eventually by the Agency, and therefore the concepts of "administration" and "payment" should be retained.

Mr Makuwane agreed and said that this issue would be addressed in the next draft. The Agency was the sole provider of this function. Provision was made for the Minister in those situations where payments could be made by sub-contractors. This was an exceptional case where contracting should be allowed.

Mr D Plaatjies (Treasury) said that there had been serious problems with monitoring and supervising of services, but this did not suggest that the Agency would not be able to monitor service level agreements. There has been an inverse relationship between private contractors and provincial social development departments, especially with regard to capacity. Key issues were being addressed with the development of the Agency around management and related issues. Security was another issue. Currently, private contractors transferred billions of rands per month and so the security of funds was shifted to private contractors. The question was therefore around how to manage service delivery agreements going forward.

Ms Borman referred to the Board of the Agency and asked what the benefits of such a board would be.

Mr Makuwane said that this was a complex function of Government and one of public interest. It was the feeling that with the Board and other structures, there was a long line of command to the people actually executing the functions. Institutions of oversight would not be developed, but the Minister would be directly responsible in terms of the Agency, with assistance from the Department, in this chain of command. If the Committee felt that, for the sake of corporate government issues, a Board should be established, the concept could be reconsidered. The Board would actually complicate the relationship to the Minister.

Ms Tsheole supported the Department's view on the Board and the negative implications for beneficiaries. The main focus was improving service delivery.

Advocate Masutha referred to clause 4(3), saying that an issue raised in deliberations before the hearings pertained to the possible transfer of functions to the Agency by contract or whether there would be a need for legislative amendments to effect those transfers. To do this without knowing its feasibility was unrealistic. A formulation should include "subject to applicable law", so that Government could amend those laws to make such agreements possible.

Clause 5
Ms Mars agreed with the Black Sash submission that recommended that the CEO should compile an annual report. No provision was made for more regular reporting.

Mr Makuwane said that these comments were taken into consideration. The clause would be amended so that more regular reports were submitted. The PMFA, a regulatory document, prescribed the nature of reporting and perhaps the wording should include "provide reports in terms of the applicable law".

Clause 6
Mr Da Camara noted COSATU's suggestion that the Minister could override decisions by the CEO. The understanding was that this was already implied. He asked for comment.

Mr Jehoma said that the Agency itself would decide on how to most effectively administer the payment of grants. The important issue was whether the Agency achieved its norms and standards. The Minister should not assume the position of the CEO.

Advocate Masutha said that some measure of independence was necessary to make people accountable. The Minister should however be able to intervene in cases where there was clearly wrongdoing. The Minister should be accountable to Parliament in terms of ensuring that government policy was implemented. The issue was dealt with in the PMFA in the context of difference of power between Ministers and Directors-General.

Mr Plaatjies said the operational activity and the efficiency of delivery rested with the CEO. If the CEO did not act within policy, he or she would have to account to the Minister. This was clear in terms of clause 6.

Mr Da Camara said that perhaps "override" was not the appropriate word to use in this context.

Mr Plaatjies said that the PMFA was explicit about the division of authority. In clause 6 of the Bill, the Minister had particular tools to manage the CEO. The Minister could not deal with operational issues.

Advocate Masutha said that the Minister could override decisions in terms of the appeal mechanism. The CEO was accountable to the Minister, but the question was what other overriding functions the Minister should have other than accountability and the appeal mechanism.

Mr Jehoma said that legal drafters would bring about the necessary changes.

Clause 7
Ms Mars agreed that the Public Service code should apply. The concern was that it could lead to the same problems experienced in the current system. She asked whether there was any provision for bringing staff up to speed with regards to skills.

Mr Makuwane said that the issue raised by COSATU had been noted by the Department. The necessary changes would be effected.

Ms Borman asked whether the staff would remain public servants because the changes proposed implied that this would be so.

Ms Tsheole said that the there had been problems with regard to service delivery. Beneficiaries had to be protected. She reiterated Ms Borman's question about measures to ensure the protection of beneficiaries.

Mr Jehoma said that the Department had not applied itself to the content of the Public Service code when drawing up amendment in terms of 3(a) to (h). The Department differed on 7(1) in that employees had to be employees of the Agency. There would not be a purpose for a Bill in this respect. On 7(2), the Minister of DPSA determined the human resources policy and would not appreciate a new policy entirely different to their current policy. There should be a level of flexibility that identified the Agency as a specialist institution. Regarding 7(3), the Public Service code would be reconsidered so that it provided protection to beneficiaries in terms of codes of conduct and related issues.

Advocate Masutha expressed doubt that the Department had the necessary expertise on this matter. Treasury was present for guidance on issues in their domain. No one from DPSA was present. The fact that the Department conceded that this was a duplication was a concession that they might have erred in not advising the Committee adequately when considering this clause. DPSA should provide input to ensure that matters were adequately catered for. The Department should bring an expert on this matter from the relevant authorities to make informed decisions.

Mr Plaatjies stated that a paradigm shift within the Committee was necessary. There was a consensus that although the Agency would appear a public entity, it would be governed by Public Service rules and regulations. The key issue was that the system within which people worked could make them a product of what was delivered to beneficiaries. The intent was to develop a single administration for the payment of grants with a new delivery ethos. This could not be done with nine separate institutions with different ideas of how to interact with people within different systems. The Agency had to be given the opportunity to fast-track delivery and create a paradigm shift in terms of dealing with the public.

The Chairperson said that the Committee worked with what came from the Department. It was suggested that with the establishment of the Agency, delivery would improve.

Social Security Agency Bill

Ms G Borman (DA) said that an interesting submission on personnel stated that if staff remained part of the public service, it would ensure a good balance on the ground. The concern, however, was that while the Agency needed to deliver, it was also important that Social Welfare at provincial level continued delivery.

Mr M Masutha (ANC) said there had been initial vacillation on whether the Agency's staff (referred to within the Public Service Act) should be regulated generally under the Labour Relations Act or specifically under the Public Service Act. The latter option would mean that staff would become public servants under the public service regulatory framework and staff code. Currently, the only suggestion of gravitating towards the public service was provided by subclauses 7(4) and 7(5). Subclause (4) only dealt with inclusion of the employees under the government employees' pension plan. Subclause (5) related to the transfer of current public servant staff in terms of the Public Service Act. It did not, however, describe whether staff were appointed in terms of the Public Service Act. Another question was whether the public service code adequately addressed service delivery and the relationship between beneficiaries and social assistance officials. It was not clear whether issues that had been itemised in subclause (3), were already catered for in the public service staff code.

Ms N Tsheole (ANC) expressed concern that there should be no more job losses among employees and social security officials. She asked for an explanation of subclause (4) with regard to state pension funds and service delivery.

Mr Jehona (Department of Social Development) disagreed with Mr Masutha's comment about vacillating on conditions for Agency staff employment. Agencies were established for strategic purposes and required different institutions outside of the Public Service Act and the Public Service Regulations. Entities were provided for all alternative service delivery models. Subclause (4) ought to be applied and it was a general rule that the Commission invested in pension funds. He commented on subclause (5) that secondment to the Agency was dealt with in terms of regulations (Regulation 15 provides for secondment and then staff returning to their original departments). Regarding the movement of current employees, conditions for support staff would be subject to negotiations and discussions with Labour and the provinces. The Committee's proposed amendments to subclause (3) were appreciated and the Department would look at the public service code of conduct.

Chapter 4: Funds and Business of Agency
Clause 9: Funds of Agency
The Chairperson referred to Accenture's submission which stated that as the Agency would administer billions of Rands, it would need particularly sound financial management and operational efficiencies. Fraudulent practices also required particular attention. While Chapter 4 addressed general financial management requirements, Accenture argued that the Bill needed to include more provisions setting out a clear accountability framework.

Mr Makuvenu (Department of Social Services) responded that the PMFA dealt adequately with those issues.

Clause 22: Regulations
Mr Jehona said that subclause (b) could be deleted as proposed during the hearings.

Chapter 6: Transitional Provisions
Clause 23: Employees
The Chairperson referred to Accenture's suggestion that staffing transitional provisions should be strengthened to include the principles that should underline the transfer and attract appropriate skills to the Agency. While retaining jobs was important, it should not undermine the importance of ensuring that the Agency had the required key competencies.

Ms Borman noted that those staff issuing grants at provincial level would be transferred to the Agency. However, this did not take care of the concerns raised previously.

THE PMG MONITOR UNFORTUNATELY HAD TO LEAVE THE MEETING AT 5PM. MINUTES FROM THE FINAL 45 MINUTES OF THE MEETING ARE AWAITED FROM THE COMMITTEE CLERK.