The South African Social Security Agency (Sassa) provides social grants to low-income individuals across the country, as a means of supporting the most vulnerable citizens.
Millions of South Africans rely on these monthly social grants for their survival, as many are unemployed or unable to work.
The National Treasury allocates funding for Social Assistance Grants to the National Department of Social Development (DSD) on an annual basis; this money is “specifically and appropriated funds”, which means it may not be used for any other purposes.
The Department ensures that payments to Sassa are approved within four days of the scheduled payment dates.
Once payments have been made, Sassa is required to submit expenditure reports on a monthly basis to reflect all payments made. This is used as a monitoring mechanism, explains the Minister of Social Development, Lindiwe Zulu.
In October 2022, Sassa ceded its contract with the South African Post Office (SAPO) for the payment of social grants to Postbank, a separate entity within the postal service.
This move ensured that the liquidation proceedings of SAPO would not disrupt the service agreement with beneficiaries, as a solvent institution had taken over the contract.
However, the transition to the Postbank has not been without its challenges.
The new entity had a limited three-month timeframe to prepare for assuming responsibility, and it remained reliant on SAPO for certain services that were experiencing difficulties.
Recognizing this over-reliance as a concern, the Department of Social Development and Sassa engaged in ongoing discussions with Postbank to explore alternatives and mitigate the impact of these challenges.
Sassa and Postbank have had continuous issues in the past, on multiple occasions, when it comes to money distribution and beneficiaries successfully collecting their grants.
Although there are multiple ways to collect grant money, many beneficiaries only have access to the Post Office, unless Postbank drives to the area to distribute grants. Challenges with Postbank/the Post Office often leaves beneficiaries worried about their money, if it has been withdrawn or if they have been kicked off the system.
Sassa says it follows the payment schedule "rigorously for processes leading to pre–payment files extraction, as well as actual payment extraction."
These processes include (but are not limited to) the following:
- The schedule covers a process to verify new and changed bank accounts/cellphones and is performed daily, to ensure that there is no backlog of unverified accounts at the time of payment file extraction. Where an account is on unverified status for more than 5 days, the account is re-extracted and re-submitted for verification through the National Treasury, with the banks.
- The schedule, which covers processes to means test new and existing applications with the banks, has been formalized and is scheduled in advance leading to the extraction of the payment file.
- For bulk payments of social grants, a payment schedule is compiled and agreed to with the banks and retailers to ensure enough cash is supplied and in circulation during payment periods.
- Constant beneficiary directed (via SMS) and public communication is done throughout all communication channels to ensure that beneficiaries are kept up to date regarding payment dates, as well as any changes in payment dates or processes.
The Grants Payments System used by Postbank to facilitate social grants payments has been migrated to a more stable environment from January 2023, says the Minister.
This was done to immediately address the infrastructure-related performance issue. The migration to the cloud platform also provided improved security in the Grants Payments System and reduced downtime, given that most of the payments challenges were Information Technology system related.
If someone has applied for a Sassa grant, but they have been denied, Postbank cannot help with finding out the specifics as to why they were rejected. Instead, Postbank will redirect the applicant to Sassa (and vice versa, where necessary).
Postbank is not in possession of that kind of information, since Sassa has an applicant's details and is the entity responsible for determining eligibility criteria.
Postbank can only see if the money is available for that individual, but they cannot see why or why not.
Grant collections are not done at Sassa offices, but can also be done by heading to retail stores, such as Shoprite, Checkers, U-save, Pick ‘n Pay and Boxer as well as ATMs. Grants can also be paid using a bank account.
SASSA distributes more than 18 million permanent social support grants monthly. These Sassa grants ensure that South Africa's vulnerable people can access basic goods and services.
The SRD grant is set to come to an end in March 2024 and will eventually transform into the Basic Income Grant.