Social Security Review2021 Evolution of Social Security in South Africa: An Agenda for Action ACKNOWLEDGEMENTS Copyright 2021 The Department of Social Development extends its Department of Social Development appreciation to the HSRC for providing editorial services for this inaugural edition of the Social Security Review. Special thanks This publication is an output of the Development of Social go to Shirin Motala, Stewart Ngandu and Tim Hart for their Development with support from the Economic Development excellent guidance and support to the Department to ensure Programme, Human Sciences Research Council. a high standard for the publication, including the peer review of all the chapters. The Department is immensely grateful to EDITORS: Shirin Motala; Stewart Ngandu & Tim Hart the Authors who willingly responded to the requests from the HSRC for editing and approving of drafts. This is more so as Credits many of these requests came at short notice. Cover Illustration and design 2021 by Ilse Visagie, HSRC Book layout and production by Blackmoon Design and Advertising We wish to acknowledge the contribution of the team of Copy editing by John Seagar. Peer Reviewers, 23 of them who will remain unnamed as the approach was a double blinded peer review process. They Copyright Statement provided their intellectual insights and gave direction to the The text and data in this publication may be reproduced as long authors in order to enhance the quality of the contributions. as the source is cited. Reproductions for commercial purposes are forbidden. We appreciate other colleagues at the HSRC, whose various contributions in the execution of the project enabled the Rights and Permission - All rights reserved achievement of milestones under tremendous pressure. These include Ms Denise Booysen, Mr Gray van der Berg, Ms Laetitia Publisher: www.blackmoon.co.za Louw , Ms Shingirira Muzondo and Mr Phumlani Ndlovu. Ordering Information: copies can be obtained for free from the HSRC and the DSD A special thanks to Blackmoon and in particular Milly Maphanga Edition and Year: First Edition 2021 who exercised immense patience and flexibility in ensuring that we got the publication to this stage. Disclaimer: The views and opinions expressed in the various chapters are those of the authors and do not necessarily reflect the official policy or position of the Department of Social Development and the Human Science Research Council. The conclusions and assumptions made in the analysis are not reflective of the position of any entity other than the authors. Any errors or defects remain the responsibility of the editorial team and authors. Suggested Citation: Department of Social Development (2021) Social Security Review 2021: Evolution of Social Security in South Africa – An Agenda for Action, Department of Social Development, Pretoria ISBN: 978-0-621-44817-7 TABLE OF CONTENTS Glossary of terms 2 Minister’s Foreword 3 1 Introduction 4-8 Shirin Motala, Stewart Ngandu and Tim Hart, Editors 2 Social Security in South Africa: A Historical Perspective 9-18 Selwyn Jehoma and Abigail Ornellas 3 Selected Constitutional and Legal Perspectives on Social Security in South Africa 19-32 Marius Olivier 4 South African Social Security Policy and the Human Rights Based Approach: A Review 33-41 Isobel Sarah Frye 5 Universalisation vs Targeting: Policy Considerations 42-50 Michael Samson 6 The Right to Social Security and its Implementation: What Role can the ILO Social Security Standards Play? 51-60 Krzysztof Hagemejer 7 “A Social Protection Floor: A South African Approach for Social Justice” 61-70 Viviene Taylor 8 Economic Growth and Social Security: Competing or Mutually Supportive 71-80 Alex van der Heever 9 Digitization of Social Grant Payments and Financial Inclusion of Grant Recipients in South Africa: Evidence from FINSCOPE Surveys 81-90 Kingstone Mutsonziwa; Jabulani Khumalo, Obert Maposa, Bobby Berkowitz, Ashenafi B. Fanta 10 SAMOD, A Tax and Benefit Microsimulation Model 91-97 Gemma Wright and Michell Mpike 11 Ten Years of the South African Social Security Agency: The Journey 2006-2016 98-115 Stewart Ngandu and Shirin Motala Contents 2 SOCIAL SECURITY REVIEW 1 2 3 4 5 GLOSSARY: SOCIAL PROTECTION/SECURITY None of these terms are fully ‘objective’: how they are used depends on the context, agency, etc. Social protection Social protection is the set of public actions that address both the absolute deprivation and vulnerabilities of the poor, and the needs of the currently non-poor for security in the face of shocks and lifecycle events. It encompasses a broad range of policy instruments Social protection floors A nationally defined set of basic social security guarantees which secure protection aimed at preventing or alleviating poverty, vulnerability and social exclusion for all – especially those at risk (children, the ill, elderly, disabled & those unemployed). Embedded in ILO Recommendation 202 Social security • Broadly synonymous with social protection Social safety net • Broadly synonymous with social assistance – used by World Bank primarily to refer to those programmes that ‘goal of protecting families from the impact of economic shocks, natural disasters, and other crises’ Contributory social protection Involve participants making regular payments to a scheme that will cover costs related to life-course events, for example, maternity, unemployment, old age or illness. Sometimes costs are matched or subsidised by the scheme provider. However… social insurance is strongly linked to the formal labour market, meaning coverage is often limited to formal workers. Broadly synonymous with social insurance Non-contributory social protection SP financed through tax revenues or through external aid in many low income countries. Includes social assistance and social care services. Social assistance A form of non-contributory social protection, most commonly targeted at low income groups or vulnerable population categories, providing social transfers (cash transfers, in kind or vouchers), cash/food for work (public works) or fee waivers for health or education. • Broadly synonymous with social safety net Social insurance • Broadly synonymous with contributory social protection Social care services Sometimes classified entirely separately from social protection, social care helps address the interaction between social and economic vulnerability, through services such as home-based care and family support services Labour market interventions Labour market interventions provide protection for poor people who are able to work, and aim to ensure basic standards and rights. Interventions can be active or passive: • Active labour market policies aim to help the unemployed and the most vulnerable find jobs, through interventions such as job centres, training, and policies to promote small and medium sized enterprises. • Passive interventions include maternity benefits, injury compensation, and sickness benefits for those already in work, financed by the employer. Passive interventions also include changes to legislation, for example establishing a minimum wage or safe working conditions. Subsidies Subsidies can keep prices low for basic goods and services consumed by the poor. However, subsidies are often regressive, e.g. on fuel, favours the middle classes who own cars an travel more Informal social protection Traditional community-based forms of social protection distribute risk within a community and fill some of the gaps left by formal interventions. We should always be asking how state interventions support or corrode such spontaneous systems! 6 7 8 9 10 11 SOCIAL SECURITY REVIEW 3 sector continues to be characterised by misconceptions and negative perceptions which diminish the important role that social security plays in the country. Through this publication, the Department hopes to create greater awareness and appreciation of our social security system, and facilitate public participation in the national policy discourse. The theme of this inaugural Social Security Review is “Evolution of Social Security in South Africa: An Agenda for Action”. The publication covers a wide range of subjects, such as the history of social security in South Africa, the legal framework for social security practice in our country, the establishment of SASSA as a primary intervention of the new dispensation, and more current debates on the interaction between the economy and the social security system. The publication locates social security squarely on the continuum of South Africa’s developmental agenda envisaged in the National Development Plan and as an integral part of the Agenda 2030 for Sustainable Development Goals (SDG 1). For example, it identifies social grants as one of the most effective anti-poverty interventions in the world, which have proved to have positive developmental outcomes for children, older persons and persons with disability. Combined with social insurance provisions such as unemployment insurance, occupational injuries and diseases protection and road accident cover, they reduce poverty and inequality while contributing to social inclusion of individuals and households that would MINISTER’S otherwise not be able to participate in the economy. Although this publication was commissioned by the Department of Social Development, the chapters were authored by FOREWORD different individuals with diverse backgrounds, including civil society activists, academia, local and international social security experts. By inviting a wide range of contributors, the Department