Strategic Overview 11 2.1. Mandate 11 2.2. Vision 11 2.3. Mission 11 2.4. Strategic Objective 11 2.5. Values 11 2.6. The Agency's Slogan 12 2.7.
Situational Analysis 14 3.1. Performance Environment 14 3.2. Organizational Environment 15 3.3. Description of the Strategic Planning Process 15 3.4. Medium term Strategic Orientation 16 3.5 Priorities for the period 2011/12-2013/14 16 3.6 Governance 20 3.
Poverty remains the main obstacle to the creation of an inclusive and caring society. As levels of destitution rise, government has to implement a number of initiatives that seek to reverse the severity of poverty among the majority of our people. Although over 15 million social grants are paid from the social safety net, levels of inequality remain stubbornly high. Inspired by the President's call to ensure that no child goes to bed hungry, we have increased the number of child support grant recipients, and over 10 million child-related social grants are paid.
Scientific research suggests that social grants have a huge beneficial impact on the lives of those who receive them. While some of these recipients use social grants to support their informal economic activities, others use the social grant as a means to seek employment. It can be safely concluded that social grants provide an important safety net for millions of South Africans and a springboard to better opportunities for some. This creates an opportunity for us to continue to expand the safety net to a number of South Africans who would otherwise be condemned to a life of destitution, especially within the context of high levels of unemployment.
In spite of the good progress made with regard to expanding Government's safety net, the Agency still has a long way to go in terms of enhancing its systems and processes in a way that will enable it to respond to the needs of its existing and potential beneficiaries. The migration from a cash- to an accrual basis of accounting was marred by a number of challenges, which resulted in a disclaimer audit opinion by the AGSA. Going forward, the Agency will implement all measures that work towards a clean audit report.
The other challenge that the Agency faces still is the continued application of a manual system to manage and administer its business. In the years ahead, the Agency will undertake a robust overhaul of its systems to improve service delivery to its customers. The continued use of manual systems has been a significant contributor to fraud and corruption in the social system. The Agency will intensify its efforts to implement a more proactive fraud-management strategy to ensure early detection and prevention of further losses. To this end, the Agency will continue to collaborate with other Government departments and law- enforce-ment agencies to reduce fraud and corruption in the social grants system.
The South African Social Security Agency will continue to deliver quality services to South Africans.
Consequently, specific steps will be taken to improve conditions at the pay points and service points in order to uphold respect for and dignity of beneficiaries. Furthermore, staff will be held accountable for the promises that are made to the South African population throughout this Strategic Plan.
The Agency has maintained a consistent provision of monthly-income support to a significant number of South Africans and implemented measures to reduce the turnaround times for the processing of grant applications. On average, turnaround times have decreased from 21 to 9 days. Another notable feature has been the expansion of the reach of social grants services - from 10 million grant benefits in 2006 to over 15 million in 2010. Rural areas have been targeted through the use of mobile units. To some extent, standardisation of services has also been achieved over the five-year period.
While the Agency's footprint is evident across the length and breadth of our country, challenges still remain. These challenges are set out below.
ï· The building of a nationally integrated social assistance system that contributes to im-provement in the management and the ad-ministration of social assistance have not been fully achieved.
ï· Ensuring an effective and cost efficient ad-ministration is made difficult by the fact that overall administration costs are still relatively high.
ï· Building a customer-focused institution is still not at the desired level.
The Business Case for the establishment of the Agency clearly identified the following as key success factors with respect to its establishment.
ï· Ensure enhanced financial accountability through client management systems (back office function), better grant review and maintenance systems, and enhancing fraud prevention strategies.
Over the first five years of its establishment the Agency had to strike a balance between the effort it made in establishing itself and ensuring that quality service delivery was not compromised.
ï· Ensuring effective and efficient financial management and accountability throughout the Agency remains a priority. In the previous financial year the Agency migrated from a cash- to an accrual basis of accounting.
ï· Fraud persists and continues unabated, notwithstanding proactive measures instituted by the Agency to limit fraudulent activities.
ï· Improved access to social security services.
However, the Agency has to shift gears if it wants to address the challenges alluded to in the preced-ing paragraphs. This strategic plan has to give ex-pression to a well thought out and coherent plan that seeks to position the Agency as a leading pub-lic entity in social security administration. The ser-vice delivery model provides such an opportunity.
For the first time in the life of the Agency, it has a comprehensive Service Delivery Model (SDM) that will lead to the provision of better services. This model directs the organisation's energy towards achieving synergy between the various business units and is based on sound business principles. The SDM is strategically pitched as it integrates the work of the organisation into a single coherent whole. The strategic plan 2011/12-2013/14 reflects this paradigm shift not only in the goals and objec-tives it sets for itself but also in how the budgets are allocated.
The Agency's SDM calls for the automation of core business processes to: minimise delays in the approval of social grants; improve the integrity of beneficiary data; and improve uniformity in the provision of social assistance services. The SDM further calls for a payment model that will ensure cost effectiveness and easy and convenient access to social grants by beneficiaries, as well as provide the Agency with information to facilitate accountability. The success of this model will depend on the Agency's ability to create opportunities for beneficiaries to access electronic payment systems as an alternative to the current cash-based method of payment.
The Agency's priority to enhance the integrity of systems seeks to transform the culture of service excellence and enhance its capability to deliver quality services in line with its mandate. The Agency has already put in place a number of systems, strategies, processes and models to enhance its service-delivery capability.
Another key project to be embarked upon in the next medium-term expenditure framework (MTEF) will be a business process re-engineering (BPR) exercise to assess and reconcile its mandate, processes and structure. The time to overhaul business processes has arrived now that the Agency has just completed its first five years of its existence.
The third priority calls for increased access to so-cial security services by eligible beneficiaries. The Agency has a national footprint that enables it to reach the most vulnerable groups, which are the elderly, people with disabilities, and orphaned and vulnerable children. Over the next three years the Agency will develop and implement a system that will serve as a conduit between social grants beneficiaries and other government institutions that provide other social security services. The priority also calls for building partnerships with all relevant stakeholders to improve access not only to social assistance but to other social services as well. The envisaged partnerships with councillors and traditional leaders, for example, will be instrumental in ensuring access to social services by eligible people and in eliminating unlawful and irregular access by those who do not qualify.
ï· Fraud management.
The Agency needs to deal decisively with fraud and corruption. The focus will now be on the prevention and detection of fraud and corruption. This will out of necessity entail further capacitation of the compliance unit.
ï· Good governance.
The Agency will strive at all times to project a positive image. Good governance cuts across the board from how the Agency is managed to how we treat our beneficiaries at the coal face of delivery.
ï· Beneficiary maintenance.
We need to ensure that information that affects the welfare of beneficiaries is timeously communicated to reach all beneficiaries.
ï· Audit outcomes.
The challenge is how we deal with prior year issues effectively so as to avoid further qualifications by the AGSA.
Going forward we need to ensure that our service delivery initiatives focus on our customers. For this reason it becomes imperative that a turnaround strategy is implemented focused on quick-wins and high impact interventions. Indeed, working together we can do more to ensure that the Agency lives up to its slogan of "paying the right grant, to the right person, at the right time and place NJALO."
In conclusion, I would like to acknowledge the con-tribution of the Minister and Deputy Minister of So-cial Development, and the Director-General of the Department of Social Development in the develop-ment of this strategic plan and wish to express my sincere appreciation for their support and guidance.
The mandate of the Agency is to ensure the provi-sion of comprehensive social security services against vulnerability and poverty within the consti-tutional and legislative framework.
A comprehensive social security service that assists people in being self-sufficient and supporting those in need.
To manage quality social security services, to eligible and potential beneficiaries, effectively and efficiently.
The Agency's main objective is to build a high-performance institution, which manifests itself by compliance with good governance principles, while striving for operational excellence via continued service delivery improvements to beneficiaries.
The Agency, as a public entity, subscribes to values that promote democracy and a culture of respect for human rights.
The Agency is committed to building unity and good relations amongst its internal and external stakeholders. This will be achieved via the promotion of a shared vision, shared values, the pursuance of common goals, and management of diversity.
As a public institution, the Agency will keep stakeholders informed of its decisions and operations. The Agency therefore provides for the right of stakeholders and the public to know what is taking place with regard to governance matters pertaining to them, and it also allows diverse views and multiple perspectives to influence its policy decisions.
The Agency is committed to the fair and impartial treatment of all its stakeholders and business partners. "Equity" encompasses the justness of actions that are free of favouritism, self-interest, bias or deception.
Integrity refers to basing one's actions on an internally consistent framework of principles. It im-plies honesty, as well as fair dealings with regard to the operations, finances and other business of the Agency. Acting with integrity is vital to maintaining public trust.
Confidentiality implies ensuring that information is accessible only to those authorised to have access to it. Confidentiality is based on the principle that certain information is privileged and may not be discussed with or divulged to third parties.
A customer-centred approach to service delivery takes the needs of customers into consideration by developing user-friendly and quality products and services. The Agency commits itself to designing social security solutions based on customer needs, both internally and externally.
Paying the right social grant, to the right person, at the right time and place. NJALO!
The Agency derives its mandate from the Acts described briefly below.
The Constitution of the Republic of South Africa, 1996 (Act No.
Section 27.1 (c) states that "everyone has the right to have access to: (a) health care services, including reproductive health care; (b) sufficient food and water; and (c) social security, including, if they are unable to support themselves and their dependants, appropriate social assistance".
South African Social Security Agency Act, 2004 (Act No.
This Act provides for the establishment of the South African Social Security Agency whose objects are to ensure effective and efficient administration, management and payment of social assistance, to provide for the prospective administration and payment of social security, including the provision of services related thereto, and to provide for matters connected therewith.
Social Assistance Act, 2004 (Act No.
This Act provides for the rendering of social assistance to persons; for mechanisms for the rendering of such assistance; for the establish-ment of an inspectorate of social assistance; and to provide for matters connected therewith.
The aim of this Act is to regulate financial management in national and provincial govern-ment institutions, so as to ensure that all reve-nue, expenditure, assets and liabilities of those institutions are managed effectively and efficient-ly and to provide for the responsibilities of per-sons entrusted with financial management in those institutions; and for matters connected therewith.
The Agency is a Schedule 3A public entity with the responsibility of managing and administering social security. The focus has been limited to social assistance while the Government's directive on comprehensive social security is awaited.
There has been a steady increase in the demand for the Agency's services and a subsequent increase in the workload of its staff since its establishment.
ï· 1.3 million are for people with disabilities.
The number of grant benefits increased from 13 million in 2008/09 to over 15 million in 2010/11. The average number of transactions that the Agency deals with per annum is 4,680,675. This number excludes payments.
The significant growth in the number of social grants has had a negative impact on service delivery and has resulted in an unfavourable audit report. In the 2009/10 financial year, the AGSA's office issued a qualified audit opinion, as it was unable to obtain sufficient, appropriate audit evidence to verify some of the transactions.
ï· There were more than 2 million files that should be destroyed.
The nature of the Agency's business renders it vulnerable to fraud and corruption. The Agency has developed and is implementing a fraud management strategy with prevention, detection, and response elements. The focus has, however, previously been more on reactive rather than proactive measures and has depended largely on a partnership with the Special Investigating Unit (SIU) for investigations and prosecutions. Ongoing challenges relating to fraud are listed below.
ï· The lack of intergovernmental collaboration and inadequate system interfaces have resulted in an environment where fraud flourishes.
The move from a cash basis of accounting to an accrual basis has brought about its own challeng-es for the Agency and has resulted in a disclaim-er Audit opinion by the AGSA. Key to the Dis-claimer was the Agency's inability to provide sup-porting documents to verify transactions.
ï· Improvement in financial management.
During the establishment of the Agency, the grants administration functions were integrated at both regional- and head-office level. While the strategic-leadership and management competen-cies (including reporting and accountability) have been largely centralised, the social assistance and administration services are still delivered through various regional, district, and local offic-es. While the payment function has been central-ised, the actual cash disbursements, excluding electronic payments through banks, are still con-ducted by cash payment contractors at various pay points throughout the country.
The moratorium on the filling of vacant funded posts has had an adverse effect on service deliv-ery. However, the Agency has prioritised critical posts to be filled in the 2011/12 financial year.
ï· Investment in information and communications infrastructure because of the uncertainty over tenure agreements.
Whilst the Agency encourages beneficiaries to be paid through electronic means, currently 70% of beneficiaries still receive their benefits in cash at pay points. The conditions at pay points leave much to be desired.
ï· Exploitation of beneficiaries by merchants and money lenders occurs.
ï· Business process re-engineering accelerated.
The Department : Corporate Strategic and Operational Planning Support held a series of meetings with the branches for the purpose of finalising the MTEF targets, with special reference to the projects identified above. The document was tabled at EXCO, where it was interrogated, amended and approved.
The Agency's strategic plan is guided by the provisions as contained in the SASSA Act, 2004 (Act No.9 of 2004) as well as government's approach to planning.
ï· Fighting against crime and corruption.
In determining priorities for the MTEF period, the Agency has identified Government priority number one - "Creation of decent work and sustainable livelihoods" - as key to informing its plans going forward.
Agency. The establishment of the Agency arising from the combination of provincial entities/processes resulted in an operating environment where different operating models were in place in various regions. The Agency still seeks to further standardise operations and align organisational structures to generic business processes and rules. Another aim is to develop norms and standards for the processes within the entire Agency and throughout the various tiers.
Accordingly, the Agency is in the process of initiating a BPR intervention that is aimed at re-looking at all the processes in the Agency's operating divisions and critically analysing and redesigning them in a manner that will result in significant and dramatic improvements in quality, performance and cost. BPR has to refocus the Agency's values on beneficiary needs and re-emphasise Batho Pele principles. In this way, enhanced service delivery will be provided for.
Priority 1 3. 5.
This priority is significant as it demonstrates that the Agency cares about its customers. It is also concerned with creating humane conditions for beneficiaries to receive their grants in.
ï· Improvement of conditions at pay points.
New policy reforms refer to the extension of the child support grant to age 18 and the implementation of an internal reconsideration mechanism. This mechanism is geared towards reviewing unfavourable decisions with respect to grant applications.
The Agency will adopt a focused approach in the next MTEF to address the findings of the AGSA with respect to missing files, loose correspondence, transfer of files, and review of files, for example. Noting the economic challenges faced by the poorest of the poor, a concerted effort will be made to reach the most vulnerable in our society.
The Agency is responsible for the Government's most comprehensive poverty-alleviation programme. Since its establishment in April 2006, the Agency has grown through various phases of development into a fully fledged service delivery organisation. However, despite its contribution to addressing the plight of millions of poor South Africans, the Agency is still facing a number of challenges. One such challenge is to streamline its business processes to obtain optimal value for money while, at the same time, improving the services it renders to the millions of people to whom it brings hope.
ï· Bridge the gap between the current reality and the envisaged end-state.
Social grant payouts are recognised as Government's single most effective poverty-alleviation programme. One of the key challenges faced by the Agency is the current cash payment model for social grants. The system inherited from the provinces has come at a huge premium to the fiscus, because economies of scale have never been realised.
The Agency seeks a payment solution that will enhance the services to its beneficiaries, address the current cash payment challenges and enhance the quality of the beneficiary experience in receiving the social grant whilst at the same time reducing the untenable cost of service delivery associated with the dispensing of the social grants. As such, the Agency will over the MTEF review the current payment system, implement an interim strategy, and develop a payment model. The payment system envisaged has to reduce the pay-ment of exorbitant handling costs and centralise payment data.
Given both service-delivery risks and financial-management risks associated with the approval, review and validation of a social security grant, a versatile system is necessary for beneficiary application, verification, maintenance, and review. Such a system should be supported by a national electronic notification system.
The improvement of the grant application process will ensure - at the outer limit - a 21-day turna-round time from application to approval.
The alignment between social assistance enrol-ment, registration, verification and approval will be significantly seamless to ensure general confidence in the accuracy and credibility of the social assistance beneficiary system.
Implementing an electronic benefits management system will address the serious problem of fraud and error in our grants payment system. The use of biometrics has to play a greater role in the administration of social assistance benefits from the time of enrolment onwards. Biometrics and automation will not only deter fraud and error, but will also authenticate beneficiaries.
The Agency is currently conducting an audit of pay point conditions towards informing and developing a pay point improvement plan. The implementation of the plan will be dependent on the availability of resources and, therefore, a phased-in approach will be adopted.
This priority focuses mainly on enhancing the Agency's capacity via the development and implementation of frameworks, strategies and policies that are aimed at realising the goal of transforming the Agency's culture and enhancing people's capabilities. This priority is mainly aimed at enabling the Agency to effectively and efficiently deliver on its core mandate, which is articulated in the first and third priorities.
ï· Ensuring the Agency's systems integrity.
The Agency is a fairly new organisation and the emphasis in the first four years had been on establishment, consolidation and operationalisation. As a result, the Agency will be embarking on a process of change management. The key focus areas of the change management programme will be proper performance management, good governance, effective and efficient leadership, and the management and re-engineering of business processes. The inten-tion is to ensure that the Agency becomes a high-performing institution, complying with good governance principles, while striving for operational excellence via continued service-delivery improvements to beneficiaries.
The Agency has come to realise that its success depends to a large degree on its organisational culture. This realisation has resulted in a commit-ment to build an organisational culture that will strive for organisational excellence. The Agency intends to invest in its personnel as it believes that its workforce is its greatest asset. A number of initiatives geared towards building a culture conducive to high standards of service delivery will be embarked upon. These include an ethics programme, which intends to guide the programmes aimed at shaping the behaviour and attitudes of personnel. To this end, the Agency will ensure that its vision, mission and values are communicated at all levels of the organisation. Delivery of quality services requires a culture of commitment, professionalism and discipline. The Agency further commits to taking corrective actions in line with the Labour Relations Act and related internal policies.
The present organisational structure and staffing levels are problematic. Despite the norms and standards for staffing, there is more staff than required in some areas. The numbers and loca-tions of staff need to be based on a simulation of processes and transaction volumes, as well as a shift of responsibilities to the customer service agents instead of adding layers of management.
The interdependencies between organisational units and regions are not clearly defined and acknowledged, which is indicative of a fragmented institutional structure and results in duplicated efforts amongst units. The institution needs to be restructured on the basis of: the type of processes managed and executed; the span of functional control and tier of management, supported by a clear definition of the unit-specific deliverables; and the internal customers for the specific deliverables of that unit.
Implementing an electronic benefits management system will address the serious problem of fraud and error in our grants payment system. The use of biometrics has to play a greater role within the social security benefits administration system from the time of enrolment, to beneficiary maintenance and reviews. Biometrics and automation will not only deter fraud and error, but will also authenticate beneficiaries.
In line with Government's key priority of rural development, the Agency has to ensure that its services are also easily accessible by South Africa's rural population. The key project under this priority is the Integrated Community Registration Outreach Programme (ICROP).
This programme aims to improve access to and equity in services to beneficiaries in rural- and semi-rural areas. The outcome of this programme is that new applicants, who would otherwise not even have been considered, are being brought into the system. An added advantage of the programme is that beneficiaries in the rural areas also have access to services provided by other Government departments, given the integrated nature of this programme. The Agency intends to improve the programme by strengthening and building new partnerships with relevant stakeholders to ensure that no eligible beneficiary falls between the cracks. These include non-governmental organisations (NGOs), faith-based organisations, and traditional leaders, for example.
In its endeavour to contribute towards Government's priority to create decent work and sustainable livelihoods, the Agency will, in collaboration with the Department of Social Development, develop a system to link social assistance beneficiaries to other social services.
The Agency will thus review its data gathering processes to enable it to be the means by which beneficiaries will have access to other government services.
The Agency believes that good governance is its foundation for delivering quality services and being accountable. Good governance in the Agency's context refers to, amongst other things: full compliance with policy frameworks; communicating values and goals throughout the organisation; and creating a platform for exchange of information and views. The Agency has developed a Code of Conduct and Ethics which will be effectively communicated at all levels. The Integrity Policy, which seeks to enforce compliance with all existing policies and enhance a culture of integrity, will be finalised and implemented in the financial year 2011/ 2012.
Section 51(1) (a) (i) of the PFMA compels an accounting authority to maintain effective, efficient and transparent systems of financial and risk management and internal control. In compliance with Section 51, the Agency has established a branch Internal Audit and Risk Management whose key functions are, amongst others, effective and efficient risk management.
ï· Fraud and corruption.
These strategic risks were taken into consideration in the strategic planning exercises and will also be factored into operational planning processes.
The Agency's strategic intent is informed by Government's strategic priority of "Building cohesive, caring and sustainable communities."
Table 1 sets out the Agency's priorities, strategic imperatives and outputs for the next MTEF. The Agency is in the process of initiating a BPR intervention that is aimed at re-looking at all the processes in the Agency's operating divisions. The intervention will also critically analyse these processes and redesign them in a manner that will result in significant and dramatic improvements in quality service delivery.
Building cohesive, caring and sustainable communities.
Measurable objective: To render effective and efficient grants administration services through the improvement of grant applications, payments, disability management, regular updating of beneficiary records, and ensuring a customer-centric approach.
434 031 of eligible children aged 17-18 years.
The Agency's spending over the MTEF period will have a particular focus on improving the grant application process This will include the development of the necessary systems and tackling social grant fraud. Going forward, the agency aims to implement a new social grants payment model that will contribute towards savings in the administration budget.
MTEF period. Expenditure is projected to increase from R5.2 billion 2010/11 to R6.2 billion in 2013/14, at an average annual rate of 5.8 per cent.
Approximately R800 million will be reprioritised from cash payment contractors to rolling out the improved grant application process and strengthening the Agency's systems and record keeping. Savings will also be used to stabilise the agency's financial position.
The graph above depicts a steady growth on the Agency's budget from 2007/08, which is the second financial year the Agency was in operation. The period between 2007/08 - 2009/10 is the actual audited transfers to the Agency while the period 2011/12 - 2013/14 is the estimated expenditure. Approximately 53 per cent expenditure on the administration budget has been on the payment to cash contractors.
Expenditure on payments towards cash payment contractors has been fluctuating over the past three financial years. The decrease in 2011/12 will result from lower rate negotiated with cash disbursement contractors or fees paid to them for the disbursement of grants to beneficiaries.
Furthermore, a significant reduction in projected expenditure is expected, commencing in 2012/13 mainly due to the new payment tender to be implemented as well as the implementation of the new payment model.
The Agency has been facing budgetary constraints that manifested in the accumulated budget deficit as shown in the graph above. It was thus inevitable that measures were put in place to deal with the budget pressures. A turnaround strategy was initiated and included the implementation of austerity measures. The graph above depicts the impact of the austerity measures on two particular expenditure items, which are regarded as discretionary expenditure compared with the others.
The drastic spike in 2009/10 was caused by unplanned expenditure, which was caused by, amongst other things, unplanned travel to and from the regions as a result of the audit process. These activities had a knock-on effect on the communication budget. Apart from this there are other activities that resulted in the shift of funds from other items to these items to address budget pressures. As can be seen from the graph above, from 2010/11 onwards planned expenditure shows a downward trajectory.
Going forward, the plan is to ensure that expenditure on these and other items is controlled and curbed to allow for the redeployment of funds to other priority areas that need funding. Further austerity measures will be implemented to bolster efforts of ensuring efficient spending and savings on these items.