The South African Social Security Agency (Sassa) is paying contractors R2,5-billion a year to distribute social grants, Coceko Pakade, its acting chief executive, has revealed.
In an interview Pakade said the agency would need R535-million over the next three years to move from processing grants manually to a digital registry of beneficiaries.
Sassa administers grants for the social development department and was recently hauled over the coals by auditor general Terence Nombembe for questionable record-keeping.
In its 2010 report on the department of social development, recently tabled in Parliament, the AG’s office estimated that as much as R10-billion has not been properly accounted for.
Some beneficiaries’ records were not available or were missing and crucial documents, such as identity documents, were sometimes absent from beneficiary files. Sassa’s performance meant that the department received a qualified audit this year, for the first time in 10 years.
Probe underway
The Special Investigating Unit (SIU) is probing procurement irregularities, high numbers of ghost beneficiaries being loaded on the grant system and cases where Sassa officials are doing private business with the agency.
The SIU said that investigations since 2005 into grant fraud had yielded more than R220-million in debt acknowledgements, of which R76-million had been recovered.
It estimated that by stopping fraudulent payments, more than R820-Âmillion had been saved.
Investigations were continuing and in one case 21 contracts worth R700-million were under scrutiny, the SIU said.
Following an investigation into grant syndicates, about 20 new beneficiaries face court each month.
Pakade said Sassa was working on an extensive clean-up operation and a business review, which had saved the agency about R900-million in the past year. The renegotiation of contractors’ fees had contributed to this.