State grants net covers 15 million - 30 Sep 2011 - Finweek

Cape Town - More than 14.9 million people now receive a social security grant out of a total population of 50 million, according to the South African Social Security Agency (Sassa) 2010/11 annual report.

However, social advocacy group the Black Sash said this does not mean the country is turning into a welfare state as the amount spent as a percentage of gross domestic product (GDP) has been at an average of 3.4% for the past five years.

This is an increase of 6.2% over the number of grants issued in the 2009/10 financial year that, in turn, rose by 7.5% from the previous financial year.

According to the National Treasury's budget review for 2011, grants rose to R88.268bn for this year compared with R7.260bn in 2009/10; the figure is expected to rise to R106.25bn in 2011/12.

According to Sassa's latest annual report, the number of grant dependencies has grown by almost 50% since the agency started operations in 2005. Sassa administers the grants on behalf of national and provincial governments, and also uses contractors to administer them.

Sassa said it had made savings of R462.7m from its 2010/11 budget allocation of R5.6bn due to reduction in the expenditure by contractors used to help distribute the grants.

Types of grants administered by the agency are those for war veterans, old age, disability, grant-in-aid (for those who need someone to look after them), foster child, care dependency, and child support.

The latter has the highest number of grants issued at 10.371 million, followed by old age grants with 2.678 million.

War veteran grants are the smallest, with the number dropping from a total of 1.216 million issued in 2009/10 to 958 000 in 2010/11.

KwaZulu-Natal was the province with the highest number of grants at 3.710 million, followed by the Eastern Cape with 2.585 million and Limpopo Province with 2.162 million. The Northern Cape and the Free State were the provinces that had the smallest number of grants issued at 387 320 and 890 000 respectively.

Black Sash spokesperson Ratula Beukman said the majority of spending on social grants was for child support and this was R270 per month until the child was 18 years old.

'Not really poverty alleviation'

"That is not really poverty alleviation and we are not yet shifting into a welfare state as others have said," she said.

Beukman said the financial recession of 2009 had spurred more people to look for social grants as a means of surviving after many had lost their jobs.

"We still need a proper social security net for those who are unable to look after themselves," she said.

Beukman also said that there were no social security benefits for those who suffered from long-term illnesses such as Aid/HIV and they were only eligible for grants once they became terminally ill.

"Those people need a grant to help them look after themselves or to pay someone to look after them while they can still remain economically active," she said.

Sassa said that the number of litigation cases it had faced had fallen dramatically over the past five years, from a high of 61 498 in 2006 to 1 944 in the last financial year.

Beukman said court rulings had made it mandatory for Sassa to follow its internal procedures first before an applicant could take them to court and this had accounted for the drop in the number of cases.

"Initially there were lawyers who took advantage of the loopholes in the law, but those have stopped. The real problem is that those who require social grants and are not getting them, do not have access to the courts," she said.

The Black Sash, along with the Legal Resources Centre, took the department of social development to court to clear the backlog of about 65 000 people who were still waiting for various social grants.

"Some of those had been waiting for 18 months and that is in contravention of the law that states a period of three months," Beukman said.