Minister Bathabile Dlamini: Tabling of Comprehensive Social Security Document at NEDLAC

25 Nov 2016

Remarks by the Minister of Social Development, Ms Bathabile Dlamini, during the tabling of the Comprehensive Social Security Document at NEDLAC

Programme Director;
Minister of Labour, Ms Mildred Oliphant;
Deputy Minister of Labour, Chief Phathekile Holomisa
Officials of Government
Ladies and gentlemen;

Firstly; let me begin by thanking the NEDLAC social partners for providing me with this opportunity to address the Executive Committee.  I am very pleased to table the much-awaited Consolidated Government Document on Comprehensive Social Security Reform.

The road to this point in our social security policymaking journey has been long and hard; not only because of the complex nature of the issues we need to address; but due to vastness of the terrain we have to cover.  I must express my sincere appreciation for the patience that you have shown over the years while waiting for the paper.

The paper I am tabling today; is informed by extensive research, debate and deliberations within government, including international partners who provided useful research and other information to support the proposals.

You may be aware that development of this paper was initiated in 2006 when Cabinet appointed an Inter-Ministerial Committee on Comprehensive Social Security Reform which is chaired by the Minister of Finance.

The IMC; supported by an Inter-Departmental Task Team (IDTT) officials from the relevant Departments to provide technical support and make recommendations to the IMC. What I am presenting today is the outcome of a five year of extensive research, robust debate and engagement among the departments.

I will not go into the details of the Paper, because the officials will do that.  However, I think it is important to emphasise some of the key principles and highlight the main elements on the proposals. First and foremost, we are guided by the Constitution; which guarantees the right of access to social security for all.

From this we draw our principle of universal coverage which we must strive for, as we identify all the reasonable measures to achieve this.  In this regard, we propose the extension of our social grants programme to those who are currently excluded. This includes looking at providing social assistance for those between the ages of 18 and 59.

The second key principle relates to social solidarity. This means that social risks must be shared by everyone, in a common pool, where everyone contributes according to their means, while receiving benefits according to their needs.  This is the essence of risk pooling that we aim to establish in respect of mandatory contributions for retirement, death and disability benefits for all workers.

The third principle relates to transparency and fairness in our subsidy programmes. We need to create a much clearer relationship between our social grants programme; tax subsidies and rebates. The end result would be that high income earners do not receive higher benefits from the state than lower income earners.

Another important principle guiding the reform proposals is the provision of minimum guarantees, to ensure that contributors have adequate benefits. These considerations were key determinants of the benefit design proposals contained in the paper.

It is a fact that even within government, there was difference of opinion on key elements of the policy proposals which contributed to the prolonged delays in finalising the paper.

This is to be expected, given the complexity of the issues, and large number of stakeholders and interests that must be taken into account in developing coherent and inclusive policy proposals.

However, it is important to state that although the paper was not released in 2012, government’s commitment to social security reform did not waver. The President re-established the IMC on Comprehensive Social Security to expedite the process. The National Development Plan (NDP) dedicated a whole chapter to social protection, and following this, government elevated the reform agenda into a specific outcome in terms of the Medium Term Strategic Framework.

In the 2014-2019 MTSF, I was tasked with leading the coordination of Outcome 13: ‘An inclusive and responsive Social Protection system.’  In addition, the ruling party also made clear political commitments regarding comprehensive social security reform.

Since 2007, all ANC resolutions referred to the need to finalise the reform proposals and implement a national fund for social security based on the principles of social solidarity and inclusiveness.  Today government is finally heeding to that call of the governing party.

Between 2012 and 2015, attempts were made to keep this work alive by government.  However, combination of institutional memory loss and competing perspectives led to a substantial revision of the 2012 paper as reflected in the Report on the Review of the Implementation of the White Paper for Social Welfare.

In 2015, I requested the Ministerial Committee on the Review of the Implementation of the White Paper for Social Welfare (1997) to also look into social security independently. Under the leadership of Professor Vivienne Taylor; who also serve as a Commissioner in the National Planning Commission responsible for Social Security. The Committee dedicated a Chapter to social security.

After reviewing the two papers on comprehensive social security tabled in Cabinet; first by the National Treasury in 2012 and the secondly by the Department of Social Development in 2015.

The Committee also made the following recommendations which were tabled and approved in Cabinet:

  • Adopt and implement the proposals on comprehensive social security;
  • Adopt the options with strongest alignment to the proposals in the 2012 paper, for the establishment of a single National Social Security Fund.

On 08 June 2016, Cabinet endorsed these recommendations, preferring the proposals contained in the 2012 discussion paper. This is also in line with the resolutions of the governing party at its National General Council in October 2015, which stated that Government should release the discussion paper to NEDLAC and support the introduction of the National Social Security Fund.

The 2012 paper being tabled today may be a bit dated. However, read together with the NDP, we believe it will provide an adequate base for consultations and will enable us to move forward on this matter together with our social partners.

I thank you