The SAIMD and the war on poverty

The Indices on Multiple Deprivation (SAIMD) provided the Department of Social Development (DSD) in its ‘war against poverty’ with information to profile specific households in areas that experienced extreme deprivation and where interventions were needed, DSD deputy director-general Dr Wiseman Magasela told delegates at the research seminar of his department’s experience in using SAIMD for policy development and implementation.

SAIMD was used to identify areas needing intervention; households were then profiled and referrals made to the relevant government departments for specific interventions. An innovation was the principle of ‘localised universalisation’, prompted by SAIMD. Essentially this implied there was no need for a means test when SAIMD showed that everyone in a certain area was poor. Any inclusion error was small enough to be unimportant when compared to the administration costs of the means test.

A very important application of the SAIMD was to enable the department to send mobile trucks into rural areas to register and process grants to ensure the poor families that qualified for the grants were able to access them, Magasela said.

The department provides nearly R10 billion to non-profit organisations in the country for welfare and related services. Using SAIMD, the department mapped where NPOs provided services, and found they were mostly in the urban areas and not in the rural municipalities where poverty was most severe. Based on this outcome, the department imposed a ‘transformation agenda’ on the NPO sector to create a presence in those high-need areas as indicated by the SAIMD.

The indices were also used to determine where early childhood development centres (ECD) should be established, and where local offices of the South Africa Social Security Agency should be situated.

Magasela said DSD was exploring how social grants could be leveraged for social and economic development. One of the options considered by the department was to use social co-operatives at the local level to do bulk buying.

‘There are many small towns in South Africa that survive on transfers from social grants as a main income stream, which creates a conveyor belt scenario where the grants come in, and 70% of the grant is utilised within four hours to buy from the local merchant. We pay R120 billion per year in social grants. Over 10 years it would be more than a trillion rand,’ he explained.

The department needed to look at innovative ideas that would bring about radical socioeconomic transformation for beneficiaries of the social grants and better outcomes for local communities as directed by SAIMD, with a strong focus on former homeland areas, Magasela said.