1. 1 Social Assistance in South Africa Seminar on Continuous Cash Transfers – Brasilia Nov 2010

2. 2 Poverty and Inequality in SA Poverty and Inequality part of the apartheid legacy. Embedded in the skewed allocation of social and human capital. Income and Expenditure survey of 2006 : –7 percent of household income goes to poorest 40% of the population. –Poorest 20% received less than 1.5% of income. –Richest 10% earned more than 50% of household income. RSA ranks as a middle-income country in terms of average income, many of its social indicators are comparable to the worlds poorest countries – due to both poverty and inequality.

3. History of Social Security in SA SA’s formal Social Security System extends to the Children’s Act of 1913 and Workmen’s Compensation Act of 1914. –Workers compensated for illness and injury and care- givers accessed child maintenance grants. Older Age Pensions Act of 1928 and Disability Grants in 1937. Black people excluded both by law and bureaucratic based discrimination. 3

4. 4 Current approach to Social Security Primary focus on implementing Taylor Report: establishment of a Comprehensive Social Security System comprising of 3 pillars: –Social Assistance, –Social Insurance and – Discretionary benefits

5. Types Of Social Assistance Grants Old Age Grants Disability Grants War Veterans Grants Foster Care Grant Care Dependency Grant 5

6. Social Assistance Since advent of democracy target groups have not changed but has been deracialised and eligibility criteria changed. All qualifying children access to CSG: –1994 ages 0 to 7 years of age. –Current children up to 18 years are eligible. Old Age Pensions: Men and Women from the Age of 60 receive State Old Age Pensions. 6

7. Social Assistance September 2010 there are 14 548 beneficiaries –The CSG is at 10 003 991 and with other grants total numbers of children receiving cash transfers are 10 667 960 –State Old Age Pensions: 2 620 939 –Disabilities: 1 203 567 7

8. Impacts It is South Africa’s most effective programme for reducing poverty, and it impacts on inequality. Expenditure Survey of 2004/2006 social assistance transfers reduced the Gini-Coefficient for income from work from 0.80 to 0.73. Meaningful transfer of income from higher income groups to the poor. Grants also well targeted: –Richest 2 provinces have the lowest take up rate –Poorest 3 provinces have the highest take up rates. 8

9. Impacts Households, included women receiving State Old Age Pension, reported better weight for height indicators for girls. Kwazulu Natal Income Dynamic Study indicated significant improvement in the weight to height scores for children. Significant reduction in experience of hunger. Households that receive cash transfers have higher expenditure shares on food and education then those poor households who don’t. 9

10. Impacts Unemployed in households who receive cash transfers are more likely to seek work. Overall the cash transfers have significant developmental impacts. 10

11. Goal 1: Eradicate Extreme Poverty Poverty linePercent below poverty line Poverty Gap 2000200620002006 Food Poverty lineR148 28.5 R209 24.8 10.47.9 $1.00 (ppp)11.35.03.21.1 $1.25 (ppp)17.09.75.42.3 $2.00 (ppp)33.525.313.08.1 $2.50 (ppp)42.2 34.818.012.5 Percent living below poverty lines and poverty gap: 2000 and 2006

12. Concluding Remarks Solidarity Based measure – state and society has to play a role in protecting the vulnerable. Barriers – means tests. Need to weigh up issues of affordability to benefits of universal coverage. New issue is conditionalities – particularly for children. 12

13. 13 DRAFT9/14/201513 THANK YOU