Chairperson, hon members, the provision of social grants, as administered by the SA Social Security Agency, is the government's most effective programme to address income poverty in the country. The Medium- Term Budget Policy Statement, tabled in the National Assembly by the Minister of Finance earlier this month, reports that about 15,2 million South Africans rely on social welfare grants. This represents about 20% of the budget.
This income assistance to the poor, the aged, the young and the disabled, who, otherwise, would not be able to meet the basic daily needs of survival, is probably the most extensive social safety net in the developing world and shows our commitment as a country to the principle of ubuntu. Of course, it goes without saying that as the economy grows and employment rises, dependence on social welfare must be reduced. Until then, the monthly pensions, the childcare grants, etc, are essential for daily survival.
Empirical research conducted by the University of the Western Cape and by the economic policy research unit confirms a number of socioeconomic benefits of the grant system, including that they are an effective redistribution mechanism in a country with the highest income inequality in the world. I also confirm that cash transfers in the form of pensions and grants in South Africa, support consumption and improve the welfare of the recipients and their broader households.
Given the importance of these grants, therefore, and the huge slice of the budget that they consume, it is absolutely essential that they are administered in a way that prevents abuse and administered under strict financial control. The social security system needs to become efficient in providing better services. In this regard, Sassa has experienced challenges in the past, some of which have been indicated by previous speakers. One of these challenges is the fact that the Auditor-General gave Sassa a disclaimer, not only in this financial year, but also in previous financial years. This is an indication of serious financial mismanagement in Sassa.
There are, however, signs that the new management team, headed by the recently appointed chief executive officer and under the leadership of the Minister and the Deputy Minister of the Department of Social Development, are turning the situation around. A clean audit opinion will require, as a minimum, focus on the following basic elements contained in the Scopa resolutions, which have been tabled. Chairperson, the ANC supports the resolution and the other three resolutions. Thank you. [Time expired.] [Applause.]