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Annual Report 2011/12 Presentation to the Portfolio Committee on Social Development

Annual Report 2011/12 Presentation to the Portfolio Committee on Social Development. Presentation Outline. Purpose Programme Performance Information - Achievements against 2 011/12 Strategic Priorities; Budget and Expenditure for 2 011/12; and Summary of Audit Outcomes.

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Annual Report 2011/12 Presentation to the Portfolio Committee on Social Development

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  1. Annual Report 2011/12 Presentation to the Portfolio Committee on Social Development

  2. Presentation Outline • Purpose • Programme Performance Information - Achievements against 2011/12 Strategic Priorities; • Budget and Expenditure for 2011/12; and • Summary of Audit Outcomes

  3. The purpose of this presentation is to present to the Portfolio Committee on Social Development the 2011/12Annual Report for the Agency. Purpose of the Presentation

  4. SASSA Strategic Priorities • SASSA’s key priorities areas for the year under review were: • Customer Care -centered Benefits Administration and Management System; • Systems Integrity • Increased access to social security services

  5. Key Areas of Focus • Given these key challenges, the Agency has identified the following as key priority projects: • Service Delivery Improvement • Automation of Grant Management and Administration • Improvement of the Payment Method • Implementation of Current Payment Reforms including Re-registration of all beneficiaries and children • Development of New Payment System • Improved Audit Report – Towards Clean Audit

  6. Key highlights • The period under review was characterised by various positive developments that informed the strategic and operational direction of the Agency to a large extent. • The appointment of the Chief Executive Officer (CEO) brought about stability in the top leadership of Agency. • SASSA remains one the major delivery network for government with more 2500 service delivery points; including 335 local offices; 902 Service points; and 9935 pay-points

  7. Key highlights (cont…) • At the end of the financial year, approximately 10.3m recipients were benefiting from the social assistance programme and the number of benefits stood at 15 595 705; • approximately 1.2m social grants were processed • A new service provider was appointed in January 2012 to pay social grants on behalf of the Agency for the next five years. SASSA embarked on preparatory process to facilitate migration of beneficiaries from old contractors to new payment providers.

  8. PERFORMANCE INFORMATION Achievements against the 2011/12 Agency’s priorities

  9. PRIORITY 1 Customer Care-centred Benefits and Administration and Management System

  10. Implementation of the Social Assistance programme • Overall the number of social grants benefits in payment was 15 595 705 at the end of financial year • Grants increased by 659 873 which represents overall growth of 4.4% from previous financial year. • Processed approximately 1.2 million new applications and more than 500 000 grants were lapsed • It is important to note that there has been 25.5% growth in the number of Acts in payment over the past 5 years.

  11. Number of grant benefits and percentage growth over a five year period by grant type

  12. Number of grant benefits by grant type and region as at 31 March 2012

  13. Implementation of the Social Assistance programme

  14. Implementation of the Social Assistance programme

  15. Service Delivery improvements

  16. Service Delivery improvements

  17. Service Delivery improvements

  18. Effective and Efficient Payment System

  19. Effective and Efficient Payment System

  20. Effective Management of Beneficiaries

  21. PRIORITY 2 Improved System Integrity

  22. Human Capital Management

  23. Internal Audit and Risk Management

  24. Legal Services

  25. PRIORITY 3 Increased access to Social Security

  26. Community Outreach Programmes

  27. Financial Performance Budget and Expenditure for 2011/12

  28. SASSA 2011/12 Audited Financial Outcome

  29. Economic Classification Spending against budget Note: Cash Handling fees are reflected separate from Goods & Services

  30. The Agency’s revenue and expenditure cont… • Total expenditure for the period under review amounted to R5,2 billion (86% of the allocated budget) • The Agency had a saving of about R881 million; • The bulk of expenditure on the Administration Budget (about 30%) went to the payment of contractors contracted to disburse grants to beneficiaries; • This is followed by expenditure on personnel, while the remaining balance covers other operational expenses and projects;

  31. Reasons for Variances on Expenditure Compensation of Employees • A saving on personnel expenditure is mainly attributable to delays in the filling of critical and replacement posts which was only concluded during the last quarter of the 2011/12 financial year. Goods & services • A significant part of the financial year’s surplus is attributed to the saving on cash handling fees (R270,927 million) • This was due to the lower tariffs charged by the contractors after renegotiation of the contracts This resulted in SASSA paying less cash handling fees, thus achieving efficiencies on the cost of disbursing grants. • The spending on a number of other strategic projects including improvements of local offices and pay-points was also delayed due to the delayed commencement of most of these projects

  32. Reasons for Variances on Expenditure Transfers & Subsidies • A significant amount of transfers and subsidies is allocated to skills levy as per Skills Development Act. The Agency apportioned 1% of the total compensation of employees budget to skills levy. • Due to delays in the filling of posts, the allocated budget for skills development levy was partially spent. Payment for Capital Assets • SASSA overspent on Capital expenditure, particularly ICT equipment: • procurement of computers and printers for the newly appointed employees. • part of the budget was utilised on ICT infrastructure development ( Cabling of offices)

  33. Auditor-General Report and Comments

  34. Audit Outcomes • SASSA received an unqualified audit opinion • AGSA’s opinion • The financial statements present fairly, in all material respects, the financial position of the Agency as at 31 March 2012 in accordance with SA Standards of GRAP and the requirements of the PFMA and the South African Social Security Agency Act, 2004 (Act No.9 of 2004). • Emphasis of matter Significant uncertainty regarding the Payment Tender and according to the AG, the outcome of this lawsuit may determine whether there was any non compliance in the procurement process.

  35. Audit Outcomes - DSD • The AGSA audit for 2010/11 identified exceptions in grants administration, which led to an audit qualification of the Department of Social Development; • Audit exceptions included, among other things, a significant number of missing files, correspondence that still had to be filed and captured on the MIS, missing critical documents,files that still needed to be transferred between regions, andold inactive files that needed to be destroyed; • Significant progress has been made in addressing the AGSA’s findings and exceptions were reduced. • DSD received also received an unqualified audit opinion

  36. Recommendations • It is recommended that the Portfolio Committee on Social Development note SASSA’s Annual Report for 2011/12.

  37. Thank You

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