The South African Social Security Agency (SASSA) has assured its beneficiaries that the payments of grants has not been compromised.
The agency gave beneficiaries the assurance after a news report claimed the agency was in a precarious situation financially and that this may end up in service providers not being paid.
"The reports also suggest that service delivery may be compromised, particularly the ability to pay social grants. There is no way that SASSA can fail to meet its constitutional obligations particularly after SASSA obtained an unqualified audit opinion for the 2018/19 financial year as per the Auditor General of South Africa (AGSA) report," SASSA said in a statement.
The agency said at the end of the 2018/19 financial year (period ended 31 March 2019) its financial position stood at a net accumulated surplus of about R1.9 billion.
"This was mainly as a result of a saving amounting to approximately one billion rand realized through the government-to-government collaboration with the South African Post Office (SAPO) who took over the payment of grant monies to beneficiaries.
"The cash and cash equivalents as recorded in the annual financial statements (2018/19) stands at approximately R1.9 billion and this bears testimony of SASSA being a going concern and therefore impossible for it to go under or seek a Treasury intervention," the agency said.
SASSA also administers the budget in respect of social grants funds which are disbursed to grant beneficiaries on behalf of the Department of Social Development.
On average SASSA disburses about R14.2 billion monthly to 17 million beneficiaries.
"The 2019/20 total budget allocation towards grants disbursements amounts to R175 billion. Of this amount approximately R89 million representing 49% has been spent as at the period ended 30 September 2019," the agency said.
This indicates that the department through SASSA will be able to continue to pay grants timeously every month as usual.
"The public should take note considering current processes that SASSA shows improvement in the prevention of irregular expenditure which proves to be bearing fruits. The Agency is focusing on finalization of the irregular expenditure cases in 2019/20 and that includes implementing consequence management and engagement with National Treasury as it is only National Treasury that approves condonation once the Agency has dealt with consequence management," SASSA said.
With regards to the R78 million fruitless expenditure incurred last financial year, the R74 million of this expenditure relates to a payment to Cash Paymaster Services (CPS).
SASSA is in the process of recovering it. The payment relates to a misinterpretation of the contract SASSA had with CPS which led them benefitting unduly from work done internally by SASSA.
"Instead of paying back the money CPS has taken the matter to court as usual although their chances of success are non-existent. SASSA has put in place tight internal controls to avoid future occurrences of similar irregularities and fruitless and wasteful expenditure ensuring the officials responsible for committing such are held accountable. The consequence management that has been put in place to ensure that a stop to irregular or fruitless expenditure is achieved," said SASSA.