grants
16 January 2007
The provision of social assistance by the State does not promote teenage
pregnancies and other alleged perverse incentives, according to preliminary
findings of a research conducted by the Department of Social Development.
The Department commissioned the research following anecdotal evidence about
alleged perverse incentives of social grants. The rapid increases in the growth
of social grants take-up rates during the period 2003/04 and 2004/05 raised
concerns about the social grants system's sustainability and potential perverse
incentives.
The four key areas that the research addressed were:
* the alleged increase in teenage pregnancies relating to the child support
grant (CSG)
* the possible fostering of children in the biological family context in order
to access the foster child grant
* the believed reluctance to take medicines to control certain ailments that
can lead to permanent disability in order to access the disability grant
* the supposed tendency of beneficiaries accessing grants not to take part in
the labour market and therefore creating a culture of economic dependency.
The preliminary report presents the findings of the completed first two
phases, a literature review and a quantitative analysis of the data on the
social pensions system (Socpen).
Findings
Disability Grant
The quantitative analysis of the Socpen data did not provide any evidence of
people changing their behaviour in order to access the Disability Grant
(DG).
"The statistics provide little evidence of people changing their
circumstances to obtain the disability grant. Reports of such incidents are so
far anecdotal and unverifiable. The increase in disability grant take-up rates
often have more to do with people's inability to enter the labour market and
the scarcity of employment opportunities. The alleged behavioural changes will
be further probed through a separate qualitative investigation," said the
Minister of Social Development, Dr Zola Skweyiya.
Research indicated that in some instances, the DG is used as a poverty
alleviation grant rather than a compensatory grant for people with temporary or
permanent disabilities. There are indications that even if people are
unsuccessful on first application, they return with new ailments until such
time as their applications are approved.
The research also confirmed the increase in the number of women accessing
the DG. Just over half of the women receiving the DG are also accessing grants
for children.
The investigation has uncovered policy and administrative weaknesses in the
provision of the DG, and corrective measures have since been introduced.
Weaknesses include that the Temporary Disability Grant (TDG) is not, as a rule
terminated, therefore beneficiaries tend to stay on the system for long periods
of time.
Remedial action is being undertaken by the Department. For example, the new
definition of disability and a new disability assessment tool were piloted in
three provinces. Systems to ensure regular reviews of temporary disability
grants have also been implemented.
Child support grant
From the analysis of the Socpen data, no link could be established between
the availability of the CSG and the fertility of teenagers.
Dr Skweyiya explained: "The quantitative analysis revealed that there had
been a huge growth in the number of CSG beneficiaries in recent years. However,
if a comparison is made between the numbers of teenagers receiving the CSG with
the incidence of teenage births in the national population, the quantitative
analysis suggests that the take-up rate of the CSG by teenage mothers remains
low."
Teenagers (younger than 20 years) represent 5% of all CSG recipients
registered at October 2005. These teenagers claiming the CSG were considerably
lower (13% lower) than the proportion of teenage mothers in the South African
population (mothers younger than 30 years). The majority of caregivers only
receive one CSG. In addition, the allegation of "child farming" (alleged
practice of registering many children to access the grant) was ruled out.
"When the CSG was introduced for younger children, one of the main reasons
was to provide financial support during the first three years of a child's
life, when good nutrition has the most significant effect on the development of
a child. However, the majority (53%) of CSG recipients only apply for the CSG
when their children are older. Reasons for the relatively low uptake probably
include the fact that caregivers struggle to get the required documentation and
do not always have the necessary knowledge about the CSG," said Dr
Skweyiya.
Foster Child Grant (FCG)
There is no conclusive evidence that the foster care grant is growing as a
result of the existence of perverse incentives. "However, evidence from the
research shows that although the foster care grant was not designed as
additional support, in the absence of income support for kinship arrangements
and adoption, the cost of providing the foster care grant will continue to
grow," said Dr Skweyiya.
The research has revealed that informal fostering is a well-established
practice in certain sections of the South African population. It further
suggested that foster care is a valuable form of alternative care for children
whose parents are deceased or unable to care for them.
The quantitative analysis revealed that in the majority of cases, the FCG is
paid to children who have lost one or both parents, and that the majority of
foster parents are related to the foster children. In 41% of cases, the foster
parent was the grandmother, in 30% of the cases the foster parent was the aunt,
and in 12% of cases other relatives were the foster parents. Only in 9% of the
cases were the foster parents not related to the foster child. Nearly two out
of three foster parents receive more than one grant type. Many are also
recipients of the Older Persons Grant, the Disability Grant and or the CSG.
"Because the majority of foster children are orphans, their placements are
expected to be long-term. However, the majority of orphans are not supported
through receipt of the FCG, and the FCG case loads could rise substantially if
more families took this course of action in the event of parents dying," warned
Dr Skweyiya.
The research findings, including the outstanding qualitative research
aspects, will inform necessary policy adaptations and improvements in the
grants administration system. For the full report, visit http://www.socdev.gov.za.
* Linking Social Grants Beneficiaries to Poverty Alleviation and
Economic Activity. A Discussion Document - 1 November 2006 (MS Word
format)
- pdf format here
* Report on Incentive Structures of Social Assistance Grants in South
Africa MS Word
- pdf
format here
* A profile of social security beneficiaries in South Africa - June 2006
Vol
1 (pdf) Cover
Vol
2 (pdf) Cover
Vol
3 (pdf) Cover
Enquiries:
Lakela Kaunda
Cell: 082 782 2575
Issued by: Department of Social Development
16 January 2007
