REPUBLIC OF SOUTH AFRICA
SOUTH AFRICAN SOCIAL SECURITY AGENCY BILL
(As introduced in the National Assembly as a section 76 – Bill; explanatory summary of Bill in Government Gazette No. of ) The English text is the official text of the Bill
(MINISTER OF SOCIAL DEVELOPMENT)
[ B -2003]
GENERAL EXPLANATORY NOTE:
[ ] Words in bold type in square brackets indicate omissions from existing enactments.
Words underlined with a solid line indicate insertions in existing enactments.
To establish the South African Social Security Agency which will manage and control the administration and payment of social security grants; and to provide for matters incidental thereto.
BE IT ENACTED by the Parliament of the Republic of South Africa, as follows:—
ARRANGEMENT OF SECTIONS
SOUTH AFRICAN SOCIAL SECURITY AGENCY
- Establishment of Agency
- Objective of Agency
- Powers and Functions of Agency
BOARD OF AGENCY
- Establishment of Board
- Functions of Board
- Ministerial directions
- Composition of Board
- Term of office and filling vacancies
- Vacation of office
- Disclosure of interest
- Meetings of Board
STAFF OF AGENCY
- Chief Executive Officer
- Vacation of office of Chief Executive Officer
- Functions Chief Executive Officer
- Delegation of Powers
- Remuneration of Chief Executive Officer
- Staff of Agency
- Pension rights
- Training and development
- Application of Public Finance Management Act
- Funding of agency
- Refunds to State
GENERAL AND TRANSITIONAL PROVISIONS
- Dissolution of Agency
- Transitional matters
- Transfer of staff, assets and liabilities
- Short title and commencement
GOVERNANCE AND PERFORMANCE CONTRACT
- In this Act, unless the context indicates otherwise—
"Agency" means South African Social Security Agency established by section 2;
"Board" means the Management Board referred to in section5;
"Chairperson" means the chairperson of the Board appointed in terms of Section 8
"Chief Executive Officer" means the Chief Executive Officer of the Agency appointed in terms of section15;
"Competent Authority" means:
- a national or provincial department referred to in section 7 of the Public Service Act,1994 (Proclamation No.103 of 1994)
- a body, other than the Agency, established for a public purpose by or under an Act of Parliament.
"Financial year" means the period from 1 April in any year to 31 March of the following year;
"Minister" means the Minister of Social Development;
"provincial department" means any provincial department responsible for the administration of social assistance grants;
"recognised trade union" means a trade union registered in terms of the Labour Relations Act, 1995 (Act No. 66 of 1995), and recognised by the Agency as a collective bargaining agent of employees of the Agency;
"this Act" includes any regulation made thereunder.
SOUTH AFRICAN SOCIAL SECURITY AGENCY
Establishment of Agency
- A juristic person to be known as the South African Social Security Agency is hereby established.
Objective of Agency
- The objective of the Agency is to ensure the efficient and effective management, administration and payment of -
- social security grants
- any other momentary benefits or services conferred on the agency under any law, or
(c) any other momentary benefits in terms of a service agreement between the Agency and a Competent Authority in the Republic
Powers and Functions of Agency
- (1) To achieve its objective, the Agency must—
(a) administer applications for social assistance, which involve the, processing of applications, approval of payments and review of the grants;
(b) prepare the information pertaining to payments and schedules, as well as the central reconciliation and management of the payment transfer funds;
- enter into contractual agreements and service level agreements with service providers to ensure effective payments to beneficiaries.
- establish a compliance and fraud unit to ensure that the integrity of the social security systems is maintained;
- perform any functions that the Minister, by written notice give to the Chairperson, directs the agency to perform;
- perform any functions conferred on the Agency under any law;
- render any service in accordance with service agreements between the agency and a Competent Authority in the Republic of South Africa;
- perform its functions and render services in the most cost efficient and effective manner and in accordance with the values and principles governing public administration referred to in section 195 of the Constitution; and
- Perform its functions and render services under the policy control of the Minister.
(2) The Agency may
determine its own staff establishment,
bargain collectively with the recognised trade unions representing staff of the Agency;
obtain the services of any person, department of state or institution, to perform any specific act or function;
hire, purchase or otherwise acquire any movable or immovable property and proprietary right, and lease or dispose of property so acquired but may not acquire or dispose of immovable property without the prior approval of the minister, granted with the agreement of the Minister of Finance.
insure itself against any loss, damage, risk or liability;
impose fees or charges when performing an act or function in terms of section 4(1) (f) and (g);
perform legal acts, or institute or defend any legal action in its own name;
engage in any activity whether alone or together with other organisations in the Republic or elsewhere, to promote proper, efficient and effective social grants administration; and
do anything that is incidental to the exercise of any of its powers.
BOARD OF AGENCY
Establishment of Board
(1) The Agency is governed and controlled by the Management Board in terms of a governance and performance agreement entered into with the Minister.
(2) The governance and performance agreement may provide for, amongst other things, the matters set out in the schedule. —
Functions of Board
(1) The Board must—
- ensure that the Agency strives for the achievement of its objectives referred to in section 3;
- exercise control over the performance of the functions of the Agency;
- ensure that the Agency functions are performed efficiently and effectively; and
- take decisions regarding the Agency’s goals, priorities, policies and strategies, that are not at variance with published government policy.
- The Board may, by resolution, delegate any of its functions to the Chief Executive Officer or to a member of staff.
- A delegation made under (2)
- continues in force in spite of a change in the membership of the Board; and
- may be revoked by resolution of the Board.
- The Board represents the Agency and all acts performed by the Board or on its authority, are acts of the Agency
- (1) The Minister may, by written notice given to the Chairperson, give directions to the Board about policy matters and the performance of the Agency's functions.
(2) The Minister must, before giving a direction under subsection (1) ask the Board for its written advice and comments on the impact of the proposed direction on the Agency's operations.
(3) The Minister must, in giving a direction, have regard to any advice or comments given by the Board.
(4) If the Minister gives a direction, particulars of any advice or comments given, must be included in the annual report for the Agency for the financial year in which the direction was given.
(5) The Minister may ask the Board for any information pertaining to the functioning of the Agency.
(6) The Board must, within a reasonable time, give the Minister accurate information as requested.
Composition of Board
- (1) The Board consists of not less than six and not more than ten members appointed by the Minister in the following capacities –
- Chairperson as a non-executive member;
- Chief Executive Officer; and
- A minimum of four and a maximum of eight members
- The Minister may determine the mix of portfolios for the Board that may include representation by role players and persons with expertise, including but not limited to:
- business administration;
- corporate management;
- finance, legal and economic matters;
- information technology and systems;
- internal audit; and
- special knowledge that could be of value to the Agency in the performance of its functions.
(3) For the purposes of appointing members of the Board, the Minister must–
- by notice in the Gazette and by such other means as may be viable, invite nominations of persons as candidates for the positions on the Board; and
- appoint a nomination panel to compile a shortlist from which the Minister may appoint persons on the Board.
(4) The Minister may appoint a member, other than the Chief Executive Officer, to act as the Chairperson during a vacancy in the office of the Chairperson, or when the Chairperson is absent from duty, or is, for any other reason, unable to perform the duties of the Chairperson
Term of office and filling of vacancies
- (1) A Board member, other than the Chief Executive Officer-
- holds office for a period specified in the letter of appointment, but that appointment may not exceed three years; and
- is eligible for re-appointment for a second term.
- A member of the Board may not be appointed for more than two consecutive terms of office.
- If a member of the Board vacates office or dies, the Minister may fill the vacancy by appointing a person in accordance with section 8 for the unexpired portion of the term of office of his or her predecessor.
- A person is disqualified from being appointed or remaining a member of the Board if he or she—
(a) is not a South African citizen or permanent resident in the Republic;
(b) is an unrehabilitated insolvent;
(c) is convicted of an offence and sentenced to imprisonment without the option of a fine;
(d) becomes a member of—
(iii) a provincial Legislature;
(iv) the Executive Council of a province; or
(v) a Municipal Council.
Vacation of office
- The Minister must relieve a Board member of his or her office if that member -
(a) submits his or her resignation in writing to the Minister;
(b) fails to comply with the governance and performance agreement, after being afforded a reasonable opportunity to rectify that failure;
(c) is disqualified in terms of section 10 from being a member or remaining a member of the Board;
(d) fails to attend three consecutive meetings of the Board without prior leave of the Chairperson;
(e) has been unable to perform his or her functions of office effectively due to ill health;
(f) has been declared by a court to be of unsound mind; and
(g) without reasonable excuse, contravenes section 12.
Disclosure of interest
- (1) If a member of the Board, or his or her spouse, immediate family, life partner or business associate has a direct or indirect pecuniary interest in any matter to be dealt with at any meeting of the Board, that member must immediately after that interest has come to his or her attention, disclose that interest and the extent thereof in a written statement to the Chairperson who must table that statement at a subsequent meeting of the Board;
(2) The member referred to in subsection (1) may not vote at, attend or in any other manner participate in, the meeting of the Board, nor be present at the place where the meeting is held during the consideration of the matter;
(3) If any member fails to disclose any interest as required by subsection (1) or, subject to that subsection, if he or she is present at the place where a meeting of the Board is held or in any manner participates in the meeting of the Board, the relevant meeting of the Board is null and void.
(4) A member is guilty of an offence and liable on conviction to a fine or to imprisonment for a period not exceeding five years if he or she-
- contravenes subsection (1); or
- fails to leave the meeting or hearing as required by subsection (2)
Meetings of Board
- (1) The Board must hold such meetings as are necessary for the efficient performance of its functions.
(2) The first meeting of the Board must be held at the time and place determined by the Minister and thereafter such meeting must be held at such times and places as the Chairperson may determine.
(3) The Chairperson -
(a) may convene a meeting at any time; and
(b) must convene a special meeting on receipt of a written request signed by a least two other members and such meeting must be held within two weeks after receipt of such request.
(4) The Minister may convene a meeting at any time and participate in the discussion, but is not eligible to vote on any matter.
(5) If the Chairperson is not present at a meeting, the members present at the meeting must elect an Acting Chairperson who, while he or she acts, performs all the functions of the Chairperson.
(6) A quorum for a meeting of the Board is the majority members of the Board.
(7) A decision by the majority of the members of the Board constitutes a decision of the Board and in any event of an equality of votes on any matter, the Chairperson has a casting vote in addition to a deliberate vote.
(8) Subject to section 12 (3), a decision taken by the Board or an act performed under that decision is not valid merely by reason of-
- any irregularity in the appointment of a member;
- a vacancy on the Board; or
- the fact that any person not entitled to sit as a member sat as such at the time when the decision was taken;
Provided such decision was taken by a majority of the Board members present at the time and entitled to sit, and those members at the time constituted a quorum.
(9) The Board must determine the procedure in respect of its meetings.
- The Agency must remunerate a member of the Board and compensate the member for expenses as determined by the Minister with the concurrence of the Minister of Finance.
STAFF OF THE AGENCY
Chief Executive Officer
(1) The Minister must, after consultation with the Board, appoint a person with suitable qualifications as the Chief Executive Officer of the Agency, after following the procedure set out in section 8(3).
- The appointment of the Chief Executive Officer is subject to the conclusion of a written contract entered into between such officer and the Board which relates to the performance of such officer’s functions in terms of this Act.
- The Chief Executive Officer is appointed for a renewable period not exceeding five years, and may not be appointed for more than three consecutive terms of office.
- The Board and the Chief Executive Officer may in writing amend the performance contract from time to time.
Vacation of office of Chief Executive Officer
The Minister may, in consultation with the Board discharge the Chief Executive Officer-
- if the Chief Executive Officer fails to perform the duties of his or her office effectively;
- on such grounds as provided for in section 11; and
- for misconduct.
Functions of Chief Executive Officer
(1) The Chief Executive Officer is the accounting officer of the Agency charged with the responsibility of accounting for all money received and payments made by, and the assets of, the Agency.
(2) The Chief Executive Officer is accountable to the Board and must -
- ensure that the functions of the Agency in terms of this Act are performed;
- report to the Board on the activities of the Agency; and
- perform his or her duties subject to the general or special instructions that the Board may, from time to time, give to the Chief Executive Officer.
(3) The Chief Executive Officer is responsible for the -
- formation and development of an efficient system of administration;
- organisation of the Agency, including the establishment of functional units, that may be structured to best give effect to country-wide functioning, as may be required in accordance with the business and financial plan;
- preparation of a business and financial plan and annual report and submission thereof for approval by the Board;
- control of staff and maintenance of discipline;
- effective deployment and utilisation of staff to achieve maximum operational results; and
- general management and control of the organisation of the Agency and its day to day business operations.
(4) If the Chief Executive Officer is for any reason unable to perform any of his or her functions, the Chairperson must appoint a member of staff of the Agency to act as Chief Executive Officer until the Chief Executive Officer is able to resume those functions.
Delegation of powers
- (1) The Chief Executive Officer may in writing and on such conditions as he or she may impose delegate any of his or her powers to a member of staff of the Agency
(2) A delegation made under subsection (1) does not divest the Chief Executive Officer of the responsibility concerning the exercise of the power.
Remuneration Chief Executive Officer
The Minister must determine the remuneration and conditions of service of the Chief Executive Officer after consultation with the Board and with the concurrence of the Minister of Finance
Staff of Agency
(1) The Chief Executive Officer Must, subject to written instructions of the Board employ staff of the Agency as may be necessary for the performance of the functions of the Agency.
(2) The remuneration, terms, and conditions of service of staff of the Agency are determined by the Board and approved by the Minister
with the concurrence of the Minister of Finance.
(1) A person employed by the Agency—
(a) becomes a member of the Government Employees’ Pension Fund mentioned in section 2 of the Government Employees Pension Law, 1996 (Proclamation No. 21 of 1996); and
(b) is entitled to pension and retirement benefits as if that person is in service in a post classified in a division of the public service mentioned in section 8(1)(a)(i) of the Public Service Act, 1994 (Proclamation No. 103 of 1994).
(2) The Chief Executive Officer is entitled to the pension and retirement benefits calculated on the same basis as those of a head of Department in the public service.
Training and development
The Agency must provide for the appropriate internal training and development of the employees and may grant bursaries and loans to employees and other suitable candidates for educational purposes within its field of operation.
(1) The Minister or any other Minister or any member of an Executive Council may, at the request of the Agency, second an officer to the Agency in accordance with section 15(3) of the Public Service Act, 1994.
(2) For as long as that officer is seconded to the Agency, the Agency must reimburse the relevant department for the remuneration and allowances paid by the department to that officer, and for any other moneys spent by the department on the officer's other service benefits and any other costs incurred by the department arising from the secondment.
Application of Public Finance Management Act
Chapter 6 of the Public Finance Management Act, 1999 (Act No. 1 of 1999), applies to the Agency.
Funding of Agency
(1) The funds of the Agency consist of—
- money appropriated by Parliament;
- any government grants made to the Agency;
- donations or contributions received by the Agency, with the approval of the Minister, from any source;
- fees for services rendered to any Competent Authority in terms of a service agreement;
- interest derive from any investment.
(2) The Agency must utilise its funds to defray expenses incurred by it in the performance of its functions.
(3) The Chief Executive Officer must—
- open an account in the name of the Agency with an institution registered as a bank in terms of the Banks Act, 1990 (Act No. 94 of 1990); and
- deposit therein all money received in terms of subsection (1).
(4) The Chief Executive Officer may invest any money received in terms of subsection (1), which is not required for immediate use, with—
- the Public Investment Commissioners referred to in section 2 of the Public Investment Commissioners Act, 1984 (Act No. 45 of 1984), with the approval of the Minister; or
- such other institution determined by the Minister, with the approval of the Minister of Finance.
(5) The Agency may, when it considers it necessary, with the approval of the Minister and the Minister of Finance—
- authorise the establishment of such reserve funds; and
- deposit such funds therein.
(6) The Agency must in each financial year; on or before a date determined by the Minister, submit a statement of its income and estimated expenditure for the following financial year to the Minister for approval.
(7) The books and records of accounts and financial statements of the Agency must be audited annually by the Auditor-General.
Refunds to State
- The Agency must refund to the National Revenue Fund any money paid to the Agency in terms of section 20(1) that has not been used at the end of the financial year, unless otherwise agreed with the Minister of Finance.
GENERAL AND TRANSITIONAL PROVISIONS
Dissolution of Agency
The Agency may be dissolved according to the terms and conditions determined by the Minister in consultation with the Cabinet.
The Minister may, after consultation with the Board, make regulations regarding—
(a) the additional functions to be performed by the Agency in furtherance of its objective;
(b) arrangements with regard to the formation of the Agency; and
(c) any matter that is necessary to prescribe in order to achieve the objective of the Agency.
(1) Transfer of the provincial functions pertaining to the management, administration and payment of social security grants must be effected on a date and in terms of the conditions approved by the Minister after consultation with the relevant member of an Executive Council, the Premier of a province, and the Agency.
(2) Until the national or provincial functions pertaining to social security grants can be transferred to the Agency, the rendering of the national or provincial functions must continue in terms of a service agreement between the relevant national or provincial Department and the Agency; and the service agreement must set out the terms and conditions for continuing such functions.
Transfer of staff, assets and liabilities
(1) All employees of participating national and provincial departments involved with the social security function contemplated in section 29, will be made an employment offer by the Agency, unless otherwise agreed to between the Agency, an employee and the Department concerned.
- The employment offer will be subject to the following principles -
- the total remuneration package, including the comparable monetary value of service benefits due to them, offered by the Agency, may not be less than those payable or due to them by the previous employer immediately prior to the transfer to the Agency;
- all vested rights accrued to the employee must be acknowledged and transferred from the previous employer to the Agency;
- prior to the transfer of employees, an agreement must have been reached among the current employers, the Agency and the Minister of Finance, as to whether -
monetary value of such benefits should be payable wholly or partially to an employee prior to transfer; and
which portion of the costs of the transferred benefits are carried by the previous employer and which portion by the Agency
- certain benefits such as accrued leave and sick leave should be wholly or partially carried by the Agency; or
- the agreement in paragraph (c), must also deal with the handling of contractual obligations between the employer and the employee;
- the offer will only be made to employees who are in the service of the respective employers at the time when the function is transferred; and
- The transfer of employees must be effected in accordance with the Labour Relations Act, 1995 (Act No. 66 of 1995), and any applicable collective agreements with organised labour.
- An employee transferred to the Agency remains subject to any decisions, proceedings, rulings and directions applicable to that person immediately before the transfer date to the extent that any proceedings against that person which were pending immediately before that transfer date, must be disposed of as if this Act had not been enacted.
- Any proceedings or litigation against an employee that occurred while in the employment of the previous employer must be conducted by the previous employer.
- The assets, contractual rights, obligations, liabilities, and unexpended balance of appropriations, authorisations, allocations, and other funds employed, held, or used in connection with the management, administration and payment of social grants, or available, or to be made available, are transferred, ceded and made over from the national and provincial departments of Social Development to the Agency, for appropriate allocation;
- in terms of an agreement between the department concerned and the Agency; and
- with the approval of the Minister and the Minister of Finance in the case of the national functions; or
- with the approval of the relevant member of an Executive Council responsible for social development and the relevant member of an Executive Council responsible for finance, in the case of a provincial function.
- Any litigation resulting from any cause of action in relation to movable assets, liability, right or obligation transferred to the Agency in terms of subsection (6) which arose -
- before the transfer date, must be conducted by or against the State, as the case may be; and
- on or after the transfer date, must be conducted by or against the Agency, as the case may be.
Short title and commencement
- (1) This Act is called the South African Social Security Agency Act, 2003, and comes into operation on a date determined by the President by proclamation in the Gazette.
GOVERNANCE AND PERFORMANCE AGREEMENT
The governance and performance agreement must provide for:
- the relationship between the Minister, the National Department of Social Development and the Agency;
- the expectations of the Minister in respect of the Agency’s scope of business, efficiency, financial performance and achievement of objectives;
- the principles, which the Agency must apply for the purpose of business planning which includes the commitment to phase in private sector participation and, where appropriate, contract out social security delivery;
- the measures that are necessary to protect the financial soundness of the Agency;
- the procedures which the Corporation must follow in the awarding of tenders and granting of public-private partnerships;
- service level standards;
- key performance indicators and measures in terms of which the performance of the Agency will be evaluated;
- the structure of the business and financial plan;
- the level and scope of monitoring of the Agency's performance by the Board; and
- any other matter relating to the performance of the Agency's functions in terms of this Act.