SASSA stops unlawful social grant deductions

MAY 7, 2016

Social Development Minister Bathabile Dlamini says 77% of the more than 13000 recorded disputes regarding unauthorised social grant deductions have been resolved in the beneficiaries’ favour.

Briefing media in Cape Town on Friday on progress made by the Ministerial Task Team on Deductions on curbing illegal, immoral and unauthorised deductions on social grants, Minister Dlamini said the department has been overwhelmed by the number of disputes.

“In February alone, the South African Social Security Agency (SASSA) got more than 40 000 queries. It is very easy to take the money off social grant beneficiaries without proper consent and controls. However, it’s very difficult for them to get their money back,” said the Minister.

Some of the recorded and investigated queries include multiple unauthorised R5 advanced airtime deductions from cellphone companies. These are experienced by pensioners around grant pay day for several months.

The Minister said the marketing and sale of funeral insurance, as well as fraudulent loan deductions were also prevalent in social grant deductions.

“It took knocking on many doors for several months to stop these deductions. Advanced airtime is the main cause of deduction disputes, and is on the increase,” said the Minister.

She said South Africans have a Constitutional right to social security, and the primary goal of social assistance is to alleviate poverty. Minister Dlamini said the beneficiaries should receive the full value of the grant, unencumbered. 

The department aims to stop the illegal practice that victimises beneficiaries by ensuring that third parties cannot simply take someone’s grant.

Revised Regulations to Social Assistance Act

Minister Dlamini said the revised Regulations to the Social Assistance Act have been published following consideration of public comments. 

“I have approved the recommendation for a SASSA owned and controlled recourse system to be in place and for beneficiaries to be refunded - backdated to 2012. We are pleased to report that a recourse system is in place,” she said.

She said this will put an end to the tide of unauthorised and unlawful deductions and ensure better control of Sections 21 and 26A which deals with the payment environment.

“We have been in consultation with the National Treasury, the South African Reserve Bank and the Financial Services Board and believe that there is an in-principle support for these regulations.

“The revised regulations firstly seek to clarify aspects of the existing regulations, which the industry have found ways to bypass,” said the Minister.

The revised regulations now make it clear that a beneficiary must in person provide written permission to SASSA for a deduction, and where they cannot do this in person, SASSA will assist the beneficiary either through a home visit or other means in accordance to their policies.

Payments for funeral policies

She said the amendments to the regulations now accurately reflect the fact that only insurers registered under the Long-term Insurance Act of 1998 may offer funeral policies.

“This is important in facilitating access to funeral policies by social grant beneficiaries in a way that offers adequate consumer protection and ensures that funeral benefits are indeed made available to the beneficiaries when a death occurs,” said the Minister.

Payments for funeral policy premiums will now only be made directly to the insurer that is responsible for providing benefits under the policy.

“No payments to brokers will be allowed. This will ensure a direct relationship between the insurer and the social grant recipient, and ensure that insurers have direct access to policyholder information.

“We have also noticed that some brokers, when faced with a case of misrepresentation, often refund premiums paid from their own funds.

“Funeral deductions from children’s grants will not be allowed. Regulation 26A was intended for adult grant beneficiaries. The amended regulations seek to clarify this original intent by limiting funeral policy deductions to adult grants only,” said the Minister.

Measures to improve security

In order to improve the system, the department will put in place a 24-hour, seven days a week, toll free number as well as have a SASSA Commissioners of Oath on site to commission affidavits so that beneficiaries are not sent from pillar to post to complete the necessary dispute forms.

The Minister said each SASSA facility has a dedicated team to deal with deduction disputes and will do everything possible to provide a dignified service, with a quick turnaround time.

“Ongoing training is in place to ensure that all SASSA staff are familiar with the disputes procedures and can support beneficiaries in a professional manner; there is a plan in place to fast track cash refunds including via the Integrated Community Registration Outreach Programme (ICROP) and Project Mikondzo.

“SASSA has launched a specific communication strategy targeting beneficiaries to ensure that they know how to lodge and follow-up on debit deductions disputes. Furthermore, SASSA now has uniforms and name tags to distinguish staff from other service providers,” said the Minister.

She encouraged grant beneficiaries to monitor their SASSA branded account statements carefully, register any deductions and follow up on the resolution of their dispute.

“The task team will continue its work to ensure that the legislation and the recommendations that I approved, are implemented and that social grant beneficiaries get recourse.”


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