‘This is an investment in our people’

2011-08-29 10:43

The social development department plans to expand its grants to children and pregnant women, but can we afford it? Sabelo Ndlangisa asks deputy director-general Selwyn Jehoma about the intention to widen the safety net.

The Unicef SA and Financial and Fiscal Commission report on the impact of the global financial crisis on child poverty suggests that many children (two million) are still not receiving the child support grant. Are there moves to introduce a basic income grant to solve the problem?

South Africa has made significant progress in reducing child poverty. Effectively, every year (since 2000) we have reduced child poverty and currently it stands at 65%. But if we didn’t have the child support grant it would be 11% more, and that’s a crisis situation.

We hear you’ll be giving some sort of a grant or support to poor pregnant women. Does that mean we are moving towards the basic income grant that some non-governmental organisations are calling for?

How do we deal with adult poverty? The Department of Economic Development is focusing on job creation as opposed to the basic income grant. We are not paying a grant to pregnant women and this poses two challenges for children.

Many women, it would appear from the data, seem to wait too long after the birth of their children to get the child support grant. Maybe they are struggling to access it and not waiting.
The implication is poor nutrition, and the child suffers stunted growth and poor psycho-social and cognitive development.

What we need to do is try and intervene as soon as possible after the child is born.

It is important to provide nutrition for pregnant mothers so that the unborn child is healthy.

The support need not necessarily be a grant. It could be in the form of food parcels.

The scientific evidence we must find out is how soon after conception should that support be provided to a pregnant mother.

We have appointed a team of health specialists, nutritionists and psychologists to investigate the best methods of support.

I hear the Department of Social Development is considering doing away with the means test in the provision of social grants to the poor. Why is the policy being changed?

Because more than 2?million children who are eligible for the child social grant are not getting it.

The target is getting to people who ought to be in the system, the poorest of the poor, but are outside it.

If we remove the means test, all the proof a person needs is a South African ID and proof of existence of the child.

The country spends 3.5% of its gross domestic product (GDP) on welfare grants, which is higher than other developing countries. Have you considered the cost of expanding the social welfare net?

It is high when we compare ourselves with countries at the same level of development.

But it should be seen as a significant investment in the development of our population.

Children with grants have a better chance of eating better, going to school, accessing health care, and growing up stronger and more productive.

The cost of having poor, underdeveloped children is higher than 3% of the GDP.

As children become more productive citizens, we as a society will reap the benefit of our social development costs.

We will be able to remove the means test without exceeding 3.5% of GDP in any significant way because it will be done gradually.

How do you mean?

As the economy grows by an extra one percent, there will be the resources required to add an extra 500 000 children to the system.

Have you considered the potentially perverse incentives of social grants that the Unicef/FFC report warns about?

The first time people raised concerns about perverse incentives, we conducted a study at significant cost to determine whether people were falling pregnant and getting disabled deliberately or not bothering to work.

We saw that maybe there were perverse incentives at the margins and because of that, we needed to take the allegations seriously and remain vigilant.

Please explain the move towards a mandatory state pension for South Africans

Compulsory contributions have three or more pillars.

The first one is the provision of a social safety net.

Secondly, people must contribute to a fund for unemployment, retirement, disability and for survivor benefits so that if the breadwinner dies, survivors can live off the savings.

This is so that people don’t become reliant on the state when employment ends.

The third is voluntary saving. Minister Bathabile Dlamini is dismayed at the slow pace of progress made in introducing mandatory saving for retirement.

There are indications that she will speed it up. She will take it up at the highest level because it is important for this administration to lay the foundation for a mandatory retirement system.

When is the document due?

Any time in the near future.

Will it replace private company pension schemes?

There is no intention of replacing them, but it will reduce the number.

There are too many and they increase costs and reduce benefits for members.

A mandatory pension will complement them.

 

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