Annual Performance Plan & Budget 2017/18 -2019/20 Presentation to Portfolio Committee on Social Development 19 May 2017

Presentation Outline Purpose Overview SASSA’s Strategic outcome oriented Goal 2014 – 2019 MTSF Priorities SASSA Strategic objectives 2017/18 Targets per Programme Programme 1: Administration Programme 2: Benefits Administration and Support Improved Social Grants Payment System – Prioratisation of the implementation of the Constitutional Court order Financial Plan Recommendations

Purpose The purpose of the presentation is To brief the Portfolio Committee on Social Development on the SASSA 2017/18 Annual Performance Plan and Budget ; and Highlight the prioratisation of the implementation of the Constitutional Court order

Overview

Overview SASSA is a Schedule 3A Public Entity established in April 2006 in terms of an Act of Parliament (SASSA Act, 2004) The objective of SASSA is to act, as the sole agent that will ensure the efficient and effective management, administration and payment of social assistance; and eventually serve as an institution to manage broader social security benefits The social assistance programme and the operation of SASSA is fully funded by government.

Overview Vision Mission SASSA’s Slogan “A leader in the delivery of social security services” Mission To administer quality customer-centric social security services to eligible and potential beneficiaries. SASSA’s Slogan Paying the right social grant, to the right person, at the right time and place. NJALO!

SASSA’s Strategic Outcome Oriented Goal NDP OUTCOME RELEVANT TO SASSA Outcome 13: An inclusive and responsive social protection system SUB- OUTCOME (SO) SO4: Deepening social assistance and extending the scope for social security. SASSA STRATEGIC OUTCOME ORIENTED GOAL Expand access to social assistance and creating a platform for future payment of social security benefits. SASSA GOAL STATEMENT To render social assistance to eligible beneficiaries

SASSA 2014-2019 MTSF Priorities The primary focus of SASSA in the medium term is: Reducing income poverty by providing social assistance to eligible individuals; Improving service delivery; Improving organisational efficiency; Automation of business systems; Institutionalising social grants payment system within SASSA.

Programmes Programme 1: Administration Sub-programme 1.1: Executive Management Sub-programme 1.2: Corporate Services Sub-programme 1.3: Information and Communication Technology Sub-programme 1.4: Financial Management Programme 2: Benefits Administration and Support Sub-programme 2.1: Benefits Administration Sub-programme 2.2: Payment Administration

SASSA 2017/18 Strategic Objectives To improve the effectiveness and efficiency of the administration of the social assistance programme; To promote Customer Centric services To provide human capital management, facilities and auxiliary services; Effective information and communication technology; Effective financial management; and To uphold good governance.

2017/18 Targets per Programme

Programme 1: Administration

Improved Organizational Efficiency Sub-programme 1.1: Executive Management Objective To uphold good governance Planned 2017/18 Targets Internal Audit Fraud Management Risk Management 30 Internal audit reviews conducted on high risk areas Fraud Prevention: 72 fraud, theft and corruption awareness programmes conducted across the 9 Regions. Fraud, theft and corruption cases investigated. 70% of new cases investigated; and 100% backlog cases investigated. An updated Strategic Risk Register maintained. An updated Operational Risk Register maintained (Head Office).

Improved Organizational Efficiency Sub-programme 1.2: Corporate Services Objective To provide human capital management, facilities and auxiliary services Planned 2017/18 Targets Human Capital management Facilities Management HR Plan reviewed (focusing on the revised grant value chain) Capacity model reviewed (focusing on the revised grant value chain) 95% of funded posts filled Implementation of the new model for Records Management Centres focusing on 3 Regions Limpopo Northern Cape Mpumalanga

Improved Organizational Efficiency: Sub-programme 1.3: ICT Objective Effective ICT operations Planned 2017/18 Targets Biometric Solution for users acquired and implemented. SASSA network connectivity infrastructure upgraded (Head Office, Regional Offices, Records Centres, District offices and 50 Local offices). Governance Risk and Compliance Solution Procured and Implemented. Data service integration solution procured and implemented.

Improved Organizational Efficiency: Sub-programme 1.3: ICT Objective Effective ICT operations Planned 2017/18 Targets Automation of Registries Back scanning solution implemented in 6 regional records centres. On-going scanning implemented in Fifty (50) local offices. Enterprise Business Intelligence Solution implemented in all branches (Finance, Corporate Services, ICT, Strategy and Business Development). Web-interface solution procured and configured.

Improved Organizational Efficiency Sub-programme 1.4: Financial Management Objective Effective financial management Planned 2017/18 Targets Unqualified audit outcome achieved. 100% eligible suppliers paid within 30 days. 5% of social assistance debts recovered and/or written off. Collections Write offs focusing undue hardships destitute people

Benefits administration and support Programme 2: Benefits administration and support

Implementation of the Social Assistance Programme Objective To provide social assistance to qualifying/eligible beneficiaries Planned 2017/18 Targets Planned to reach 1 512 000 million new applicants. 95% of new social grant applications processed within 10 days (1 436 400). Increase the number of grants in payment from 17.1 million to 17.5 (17 523 737) by end of 2017/18 financial year. Process a total of 560 000 new applications for children aged 0 – 1. 500 000 SRD applications will be awarded to families under distress (SRD budget for 2017/18 - R600 million).

Implementation of the Social Assistance Programme Objective Reduction of inclusion and exclusion errors in the social assistance programme Planned 2017/18 Targets Process foster care grants reviews in collaboration with DSD. 232 757 FCG reviews are targeted.

Improved Service Delivery Objective To raise awareness of beneficiaries on their rights and obligations relating to social assistance Planned 2017/18 Targets ICROP: 600 identified wards having access to social assistance through ICROP Mikondzo 40 Mikondzo service delivery interventions conducted Public Participation 600 beneficiary education awareness programmes conducted. 1000 public awareness programmes conducted

Improved Social Grants Payment System Objective Improved customer centric services Planned 2017/18 Targets Resolve 80% of enquiries within 5 days as per SASSA’s customer care charter. Monitor 100% of large cash paypoints (Paying more than 300 beneficiaries a day). Cost of administering social assistance - R44.00 per beneficiary. Cost as a percentage of social assistance transfers budget - 5.1% (R7.7bn).

Improved Social Grants Payment System (Prioritization of the implementation of Constitution Court order) Objective Improved customer centric services Planned 2017/18 Targets Insourcing of Regulation 26A (elevated from Operational plan) Set up of SASSA Holding Account Appointment of New Service Provider/Solution Integrator Phasing in New Service Provider and Phasing out of CPS Submission of Constitutional Court quarterly Reports (costs associated with independent experts and Counsels) Local Economic Development (Alternative pay-points) Ongoing Communication and Change Management

SASSA Financial Plan

SASSA’S MTEF APPROPRIATION 2017/18 2018/19 2019/20 Baseline/Transfer R’000 7 473 942 7 907 430 8 350 246 Less Reductions To Fund other Government Priorities - 58 224 - 30 956 -154 517 - 209 657 - 115 795 - Revised Baseline/Transfer 7 206 061 7 760 679 8 195 729 Year-on-Year Growth on baseline 4% 8% 6% Retained Cash Surplus 502 456 123 000 Own Revenue 4 400 4 600 4 876 Total 7 712 917 7 888 279 8 200 605

Commentary on the medium-term estimates There has been a total reduction of R569,149 million on the Agency’s baseline over the 2017/18 MTEF made up of R267,881 million in 2017/18, R146,751 m in 2018/19 and R154,517 m in 2019/20. These reductions were effected during the MTEC process to fund other government pressures. These reductions are resulting in spending pressures on the Agency particularly considering the transition phase.

Medium-term estimates: Programmes Economic Classification 2017/18 2018/19 2019/20 R’000 1: Administration Compensation of Employees 1 072 008 1 145 424 1 209 568 Goods and Services 1 852 557 1 789 734 1 817 323 Transfers 12 089 12 142 12 822 Subtotal 2 936 654 2 947 300 3 039 713 2: Benefits Administration Support 2 170 217 2 318 540 2 448 378 2 589 807 2 605 154 2 694 371 16 239 17 181 18 143 4 776 263 4 940 875 5 160 892 TOTAL 7 712 917 7 888 175 8 200 605

Medium-term estimates: Key Items 2017/18 2018/19 2019/20 R’000 Compensation of Employees 3 242 225 3 463 964 3 657 946 Goods and Services 4 409 900 4 360 509 4 475 390 Of which: Agency and support/ outsourced services 204 900 217 578 229 762 Communication 85 708 100 108 105 714 Computer Services 353 927 371 958 360 655 Payment Contractors 2 258 674 2 257 024 2 350 123 Lease payments 376 275 459 964 485 722 Repairs and maintenance 88 428 94 754 100 060 Property payments 431 897 444 875 469 788 Other 32 464 34 379 36 304 Transfers and subsidies 28 328 29 323 30 965 Total Expenses 7 712 917 7 888 175 8 200 605

Implications of the budget reduction SASSA had to reduce its 2017/18 baseline allocation by an amount of R209,657 million in line with the budget cut implemented by National Treasury Undertaking prioritisation of projects/activities Prioritizing more on essential items including contractual obligations and or commitments SASSA also had to scale down on the filling of critical vacancies

Financial Implications for implementation of Constitutional Court order – 2017/18 Estimates New Requirements Key Activities Estimated Costs Was the activity planned If not where does the funding come from Insourcing of Regulation 26A Contracting with Qlink R500 000 Yes, however it was in the operational plan. (Programme 2) To be covered under the current SITA Contract Setting up of SASSA Holding Account Setting up costs R1 Million Transfer of funds to Beneficiaries with commercial accounts R28.8 m Not required during the 2017/18 Phase-in of the new Payment Provider Phasing in the new card Cost to be factored in the new payment provider payment model Transaction costs for piloting areas

Financial Implications for implementation of Constitutional Court order – 2017/18 Estimates New Requirements Key Activities Estimated Costs Was the activity planned If not where does the funding come from Submission of Constitutional Court quarterly Reports Independent Monitors : Lawyers R 624 000 No Reprioritisation Independent Monitors: Technical R672 000 Senior Counsels R840 000 Phasing out of CPS Data Migration (SASSA to ensure that there is storage capacity & data verification capacity) Already within SASSA operational plan Transaction Costs R16.44 X 12m X12 Yes

RECOMMENDATIONS It is recommended that the Portfolio Committee note and approve SASSA’s Annual Performance Plan and Budget for the 2017/18 financial year.

Thank you