Unlawful, immoral deductions from social grants should stop, says Black Sash - 29 May 2013

FOR IMMEDIATE RELEASE

29 May 2013

After months of work to stop deductions from social grants, the Black Sash welcomes the long overdue decision by SASSA to prevent unlawful deductions being made from social grants by financial providers which trade in micro-loans.

After SASSA introduced an automated biometric-based payment system last year, we were horrified to find that grant beneficiaries were experiencing an avalanche of unauthorised and unlawful deductions from their social grants.

 As a human rights organisation working in the area of social security, Black Sash was alerted by community monitors, and saw the negative effects of these deductions first hand, in engagement with beneficiaries at payment points.  We were shocked at how little of their grant amount remained for food and other basic family needs. 

In terms of Regulation 26 (A) to the Social Assistance Act, only one deduction for a funeral benefit, not exceeding ten percent of the monthly grant amount, may be authorised by the grant beneficiary and paid by SASSA.  No other deduction may be made from a beneficiary’s grant, through their bank account, as a matter of law.

For the past months we have urgently raised the issue of unlawful deductions from grants through formal submissions, monitoring reports and letters; and in meetings with decision makers. If deductions were to continue unchecked, we feared the systematic erosion of our social grants system by immoral elements of the private sector and called on government to take immediate steps to curb this potentially devastating trend.

The decision, announced this week, to strictly enforce the law is a welcome indication of SASSA’s commitment to protect the massive investment made by South African society in our social security system in order to alleviate  poverty in our country.

Although positive, this step will not protect grant beneficiaries, a vulnerable group by any definition, from being targeted by unscrupulous members of the micro lending sector for short-term and unsustainable high interest rate loans, once the grant is paid out.

In this regard, Black Sash appeals to the Legislature to amend the National Credit Act of 2005 to align it to provisions in the Social Assistance Act which states that ‘grants may not be transferred, ceded, or pledged or in any way encumbered or disposed of..’ The Social Assistance Act’s provision is specifically to ensure that grants are used to ensure a decent quality of life for beneficiaries.

We also call for an independent economic enquiry to determine the real socio-economic impact of redirected social grants to the formal and informal micro finance industry.  

WE APPEAL TO SOCIAL GRANT BENEFICIARIES TO BE VIGILANT AND REPORT ANY QUESTIONABLE DEDUCTIONS FROM THEIR SOCIAL GRANTS. 

After June 2013, should  a social grant beneficiary have a problem with deductions we urge them to please call SASSA directly at 0800 601 011 or the Black Sash free paralegal helpline at 072 66 33 739.

For more information, please call:

Elroy Paulus  082 748 5621

Jonathan Walton – 083 658 7097

Ratula Beukman – 072 174 3507

Tebogo Lelaletse – 076 243 3793