18/06/2012 Social development minister Bathabile Dlamini addresses the media at the social security cluster briefing. She is flanked by her deputy minister Bongi Ntuli, public works minister Thulas Nxesi and correctional services minister Sbu Ndebele. Picture: Phill Magakoe


The government has stepped up efforts to stamp out fraud and corruption in its social security system, Social Development Minister Bathabile Dlamini has said.

Briefing journalists in Pretoria yesterday, she said the state provided social grants – through the SA Social Security Agency (Sassa) – to 15 million beneficiaries.

The total budget for grants was R105 billion.

“Sassa has intensified mechanisms to reduce fraud and corruption in the social security system,” she said.

From the beginning of the month, the agency started a full re-registration of all social grant beneficiaries “on a comprehensive biometric identification system”.

Social Development Director-General Vusi Madonsela said the number of beneficiaries who might be receiving grants fraudulently was not known.

“We can only estimate, based on international standards… that there is an estimated 10 percent leakage. Whether or not it is 10 percent in South Africa remains to be seen. Over the years, we’ve estimated we could be losing plus-minus R2 billion.”

However, this was still being investigated.

Madonsela said the limited biometric card system now being used would yield a saving of R800m for the department compared to what it was spending before.

It was estimated that through corruption and fraud in social grants, the government could be losing about R2bn from its annual R105bn budget for social grants.

The social development department also raised concerns that most funds distributed to the non-profit organisations sector were used for administration rather than on services for communities.

About R15bn was distributed to non-profit organisations a year, with R7bn of this distributed through provinces.

Madonsela said he was confident the actual number “was far less than the 10 percent international norm”.

As for the cost of the re-registration process, he said it was not an extra cost, but included in the current tender, which would cost the government R10bn over the next five years.

Earlier this year, Sassa awarded the national contract for grant payments to Cash Paymaster Services.

Madonsela said the contract was saving the government R800m a year on the cost of administering social grants.

He was not able to say how many foreigners might be illegally drawing social grants in SA.

“During the re-registration process we will identify which people are not South African or not resident in South Africa.”

To date, Sassa had stopped grant payments to 111 people identified as non-South Africans and not eligible for a grant.