Implementing successful reforms: The case of social assistance in South Africa

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South Africa’s social assistance system – through a comprehensive set of cash transfers -- covers nearly 16 million people. This is a big improvement from 1994, when cash transfers reached fewer than three million beneficiaries and suffered from discrimination and weak administration.

Estimates suggest that cash transfers in South Africa raise market incomes of the poor by a factor of 10, far greater than in other middle-income countries, including Brazil - often celebrated for its successful social assistance. Access to safety nets contributed to reducing poverty and inequality and had positive development impacts on health, schooling, and labor supply.

How do such reforms succeed? In a new report: “Making It Happen: Selected Case Studies of Institutional Reform in South Africa”, we documented how the post-Apartheid government in South Africa developed and implemented policies to improve specific public services.

In our technocratic policy world, it might be tempting to ascribe this success to the quality of program design or of “delivery systems.” While these were indeed key, the case of South Africa’s social assistance system illustrates how political commitment, supported by legal anchoring and embodied in effective leadership and inclusive dialogue play an equally important role.

Emphasis on technical rigor was, of course, prominent in the reform process. The government made use of two expert committees (Lund and Taylor), which comprised academics, practitioners, and civil society leaders and made use of local as well as international technical expertise, to design different stages of the reform. The government also put great efforts setting up efficient delivery systems, with the centralization of administrative functions in 2006 within the South African Social Security Agency (SASSA) and establishment of biometric ID verification and electronic payments.

However, political commitment to achieve results was the ultimate cause of the emphasis on technical and administrative rigor. The democratic government set out to reform all aspects of policy that it inherited from the previous regime. It was particularly committed to using cash transfers as a means of compensation for a vastly poor electorate, so as to strengthen the country’s social contract. The increase in fiscal resources devoted to social assistance reflected such commitment: nearly tenfold between 1994 and 2004, and reaching 3.4 percent of gross domestic product, a large share compared to most countries.

Political commitment both contributed to and benefitted from legal obligation. South Africa’s constitution of 1996 gives every citizen the right to “social security, including, if they are unable to support themselves and their dependents, appropriate social assistance.” Entrenching social assistance in the constitution was the first sign of political commitment to making it a key policy instrument, and ensured succeeding governments abide to it. Interestingly, this constitutional underpinning gave special momentum to the administrative reform that ultimately led to the establishment of SASSA. In a famous case, the Constitutional Court of South Africa ruled that for social assistance to be effective, it requires uniform regulation and implementation across the country, spearheading centralization through SASSA.

Effective leadership within the sector carried the momentum forward. A series of inspiring and effective ministers and director-generals in the Department of Social Development exerted credible leadership at the political, technical and administrative level, by setting the vision for the reform, building consensus around it and supporting technical staff in its execution.   

Finally, inclusive dialogue played a crucial role at all stages of reform. Top officials spent good amount of time communicating the contents and implications of the reform to the public. Notably, the task of the two technical committees also included building consensus around their recommendations, thereby helping reconcile technical aspects with stakeholder interests.

Undoubtedly, social assistance in South Africa still faces challenges, including lack of integration between cash transfers and social services, and grant application procedures that often remain onerous for beneficiaries. The SASSA has not yet overtaken payment functions, and allegations of fraud persist. And while cash transfers contributed to poverty reduction, these did not offset the country’s extreme inequality.

However, South Africa did manage something many countries struggle with: establishing a comprehensive and efficient system of cash transfers that effectively and efficiently redistributes resources to the poor. Political commitment to redistribution through social assistance was the defining thread behind such success.
 
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