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Policy Framework on Social Security for Youth in South Africa

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Policy Framework on Social Security for Youth in South Africa POLICY FRAMEWORK ON SOCIAL SECURITY FOR YOUTH IN SOUTH AFRICA Final Report Submitted to: National Department of Social Development Submitted by Human Sciences Research Council (HSRC) Private Bag X41 Pretoria, 0001 REPUBLIC OF SOUTH AFRICA Contact Name: Dr Miriam Altman Phone: 012-302-2740 Email: [email protected] and [email protected] with a copy to [email protected] 1 POLICY FRAMEWORK ON SOCIAL SECURITY FOR YOUTH IN SOUTH AFRICA This report was compiled and produced for the Directorate of Family Benefits, National Department of Social Development by the Human Sciences Research Council. Acknowledgements We gratefully acknowledge the support given to this project by the Department of Social Development. Useful feedback was provided by participants in two workshops. We would also like to acknowledge the microsimulation analysis provided by Helen Barnes. Human Sciences Research Council Private Bag X41, Pretoria, 0001 Tel: +27 12 302 2000 Website:www.hsrc.ac.za Authors: Dr. Miriam Altman, Human Sciences Research Council Dr. Zitha Mokomane, Human Sciences Research Council Dr. Gemma Wight, University of Oxford Gerard Boyce, University of KwaZulu-Natal. MARCH 2012 2 Table of Contents 1 INTRODUCTION .................................................................................................................................. 4 1.1 Background ........................................................................................................................................................ 4 1.2 Terms of Reference ........................................................................................................................................... 4 1.3 Approach to Developing the Policy Framework .......................................................................................... 5 1.4 Structure of the Policy Framework .................................................................................................................. 6 2 SITUATIONAL ANALYSIS OF YOUTH IN SOUTH AFRICA .................................................................... 7 2.1 Defining ‘youth’ ................................................................................................................................................. 7 2.2 Situational analysis ............................................................................................................................................. 7 2.2.1 Demographics .............................................................................................................................8 2.2.2 Education ................................................................................................................................. 10 2.2.3 Labour force participation .......................................................................................................... 13 2.2.4 Poverty among young people ..................................................................................................... 19 3 SOCIAL SECURITY ............................................................................................................................ 21 3.1 Introduction ...................................................................................................................................................... 21 3.2 What is social security? ................................................................................................................................... 21 3.3 The cost of not providing social security for youth ..................................................................................... 22 3.4 Social security and protection for youth in South Africa ........................................................................... 25 3.5 A multi-sector approach for a complex issue ............................................................................................. 28 3.6 International interventions for social security provisions for youth ........................................................... 29 3.6.1 Mixed Purpose with a Grant ....................................................................................................... 30 3.6.2 Skills training ............................................................................................................................ 33 3.6.3 Entrepreneurial promotion ......................................................................................................... 35 3.6.4 Employment services ................................................................................................................ 36 3.6.5 Subsidized employment ............................................................................................................. 37 4 EXPLORING OPTIONS FOR SOCIAL SECURITY FOR YOUTH IN SOUTH AFRICA ............................. 39 4.1 Some principles in considering the policy options ..................................................................................... 39 4.1.1 Identifying the social problem .................................................................................................... 39 4.1.2 No ‘one-size-fits-all’ policy ......................................................................................................... 39 4.1.3 Articulating a theory of change .................................................................................................. 40 4.1.4 ‘The carrot and the stick’ ........................................................................................................... 40 4.1.5 ‘Thick’ and ‘thin’ options ............................................................................................................ 41 4.2 Non-budgetary cost considerations ............................................................................................................. 41 4.2.1 Infrastructure/ Institutional Experience ....................................................................................... 41 4.2.2 Departmental coordination ......................................................................................................... 42 4.2.3 Spillover effects ........................................................................................................................ 42 4.2.4 Costs borne by beneficiaries ..................................................................................................... 42 4.2.5 The case for cash grants ........................................................................................................... 43 5 Policy Options - Social Security for Young People in South Africa ........................................... 44 5.1.1 Six policy scenarios .................................................................................................................. 44 5.1.2 Number of people reached and cost ........................................................................................... 47 5.1.3 Impact on poverty ..................................................................................................................... 48 6 Discussion and Conclusions .......................................................................................................... 51 7 Annex 1: Current Legal and Policy Framework for provision of services and programmes for youth in South Africa ....................................................................................................................... 58 i FOREWORD To be provided by DSD for final draft ii EXECUTIVE SUMMARY BACKGROUND Taking cognizance of the importance of young people for the advancement of society the South African government has, over the last 17 years, spearheaded policies, strategies, and plans of action to improve the well-being of youth. Poverty and a lack of work opportunities are the greatest threat to young South Africa’s social capital development. To address this issue, the National Department of Social Development (DSD)—which has set itself to develop strategies that will enhance socio- economic inclusion and integration of youth—commissioned the development of this Policy Framework for Social Security for Youth in South Africa. The Terms of Reference specifically called for: i. The development a policy framework on social security to youth that will link youth to education and employment, ii. The designing of a workable proposal and provision of proposed policy options iii. Quantitative analysis of the provision of social security to youth iv. An analysis of effective monitoring, evaluating and reporting mechanisms v. Overall costs vi. A risk assessment including an identification of any contingent risks for Government. vii. Overall recommendations. METHODOLOGY Four methodological strategies were adopted in developing the framework: Document and literature review aimed at: Obtaining a deeper understanding of the current frameworks for commitment, policy, programme implementation and monitoring and evaluation efforts to provide social security to youth in South Africa. Assessing current knowledge about the social welfare situation of young people in South Africa. Assessing the state of knowledge about social security and young people, and to document the scope and nature of “best practice” interventions on social security to youth in other parts of the world that could be relevant for South Africa. Situational analysis of youth in South Africa This entailed a desk-top analysis of the current situation of young people in South Africa segmented by demographics; education; labour
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