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University of South Africa,
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SSL2601/1/2020–2024
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Contents
Preface (v)
Learning unit 0: Orientation to the module 1
Learning unit 1: Introduction to social security 4
Learning unit 2: Constitutional and rights-based framework 20
Learning unit 3: Social assistance 33
Learning unit 4: Social insurance 49
Learning unit 5: Employment injuries and diseases 69
Learning unit 6: Health care 80
Learning unit 7: Informal and indirect social security 91
Bibliography 104
SSL2601/1/2020–2024 (iii)
Preface
Dear Student
Welcome to Social Security Law (SSL2601).
Enjoy the learning experience, and we wish you all the best in your studies.
Your lecturers
Prof TE Manamela
Mr MK Mathiba
SSL2601/1 (v)
Learning unit 0
Orientation to the module
Learningunit0
Contents
0.1 INTRODUCTION 1
0.2 LEARNING UNITS 1
0.3 PURPOSE OF THE MODULE 2
0.4 OVERALL OUTCOMES OF THE MODULE 2
0.5 THE STRUCTURE OF EACH LEARNING UNIT 2
0.6 ICONS 3
Dear Student
0.1 INTRODUCTION
Students should take approximately 30 minutes to work through this learning unit.
Welcome to the Social Security Law module (SSL2601). We hope that you will find
it interesting and rewarding. We will do our best to make your studies of this
module successful. This is a blended module, which means you will have to log on
to this module site on myUnisa. Refer to Tutorial Letter 101 for instructions on
how to do so. Please note that there is no textbook prescribed for this module.
This study guide therefore serves as the primary source for this module.
0.2 LEARNING UNITS

The study guide comprises seven learning units:
Learning unit 0: Orientation to the module
Learning unit 1: Introduction to social security
Learning unit 2: Constitutional and rights-based framework
Learning unit 3: Social assistance
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LEARNING UNIT 0: ORIENTATION TO THE MODULE
Learning unit 4: Social insurance

Learning unit 5: Employment injuries and diseases
Learning unit 6: Health care
Learning unit 7: Informal and indirect social security
0.3 PURPOSE OF THE MODULE

The aim of this module is to provide you with a general understanding of the
South African social security system. This module will give you an introduction to
and an overview of concepts such as social security, social assistance (including
social grants and social relief of distress), social insurance (including the
unemployment insurance fund, compensation for occupational diseases and
injuries and health care), and indirect and informal social security. The module will
further give you an understanding of the constitutional framework regarding the
right to have access to social security in South Africa; the influence that
international law has on the development of South Africa’s social security system;
the financing and administration of the social security in this country; and the
weaknesses of the present social security system.
0.4 OVERALL OUTCOMES OF THE MODULE

After studying this module, you should be able to process and evaluate information,
recognise and interpret the role of the most important social security legislation,
and apply the theoretical framework and social security legislation to everyday
situations. Students should also be able to use their knowledge of the general
principles of social security law to analyse and evaluate problem situations, identify
relevant legal issues, apply the relevant legal principles to those issues, suggest
solutions, and provide responsible advice.
You will find the outcomes for each learning unit at the beginning of each learning
unit.
0.5 THE STRUCTURE OF EACH LEARNING UNIT

The time that you need to complete each learning unit and the outcomes which
you have to achieve, are outlined at the beginning of every learning unit. The
activities and feedback are incorporated into the learning units as part of your
learning material. Please note that the feedback for these activities is not necessarily
a model answer and may, in certain instances, simply refer you back to the relevant
part of the learning unit. The feedback should help you to assess whether you
understand a particular component of the module or not. In addition to the
activities, we have included self-assessment questions at the end of each unit to
help you with revision and the achievement of the outcomes stated at the
beginning of the learning unit. We encourage you to write down your answers to
the activities and self-assessment questions and, for this reason, have provided
space for you to make some notes or summaries. If you require more space for
notes and summaries, then make use of additional paper.
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Learning unit 0: Orientation to the module
0.6 ICONS
The following icons will be used in this study guide.
ICONS MEANING
The time required for doing a learning unit or an activity.
Outcomes.
Activity.
Feedback.
Self-test/assessment.
Think about the concepts.
Consider or think about the concept.
Write some notes.
Learning unit 0 provided a foundational overview of the module. Learning unit 1

will introduce Social Security.
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Learning unit 1
Introduction to social security
Learningunit1
Contents
1.1 INTRODUCTION 5
1.2 THE DEFINITION OF SOCIAL SECURITY 5
1.3 THE OBJECTIVE OF SOCIAL SECURITY 7
1.4 THE HISTORICAL DEVELOPMENT OF SOCIAL SECURITY IN SOUTH
AFRICA 8
1.5 THE NATURE OF SOUTH AFRICA’S SOCIAL SECURITY SYSTEM 9
1.6 SHORTCOMINGS IN SOUTH AFRICA’S SOCIAL SECURITY SYSTEM 12
1.7 THE ROLE OF INTERNATIONAL LAW ON THE DEVELOPMENT OF
SOCIAL SECURITY IN SOUTH AFRICA 14
1.8 THE ADMINISTRATION OF SOCIAL SECURITY IN SOUTH AFRICA 15
1.9 THE FINANCING OF SOCIAL SECURITY IN SOUTH AFRICA 15
1.10 ENFORCEMENT OF THE RIGHT TO SOCIAL SECURITY 16
1.11 CONCLUSION 18
1.12 GLOSSARY 18
1.13 OUTCOMES ACHIEVED 19
Students should take approximately 5 hours to work on this learning unit.
In this learning unit, we introduce you to the concept of social security and its
objectives and components. The learning unit further provides some background
to the development of South Africa’s social security system; indicates its
shortcomings; describes how the system is financed and administered; explains the
role played by international law in the development of South Africa’s social security
system; and spells out how social security rights can be enforced.
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After studying this learning unit, you should be able to:

● understand the concept of social security
● describe the objectives of social security
● distinguish between different components of social security
● describe the historical development of South Africa’s social security system
● describe the nature of South Africa’s social security system and indicate its
shortcomings
● describe the role of international law in the development of South Africa’s social se-
curity system
● explain how social security in South Africa is administered and financed
● explain how social security rights can be enforced
1.1 INTRODUCTION
Social security is concerned with providing a safety net for members of society
against economic and social hardships. It is important to understand that South
Africa’s current social security system has its roots in section 27 of the Constitution
of the Republic of South Africa of 1996 which recognises social security as one of
the fundamental rights in the Bill of Rights (Chapter 2 of the Constitution).
Section 27 of the Constitution guarantees everyone the right to have access to social se-
curity including, if they are unable to support themselves and their dependants, appropri-
ate social assistance.
It can be deduced from section 27 of the Constitution that South Africa’s social
security system has a social assistance and a social insurance component.
It should be noted that, in addition to its formal components, namely social
assistance (which mainly takes the form of social grants), and social insurance (for
example, social insurance schemes such as unemployment, employment injuries
and diseases, and retirement schemes), social security also takes the form of
informal (for example, informal support measures by family, friends and the
community) and indirect social security (for example, access to transport, food,
health services, a healthy environment, land, housing, water and education).
1.2 THE DEFINITION OF SOCIAL SECURITY

Social security has no fixed definition. Its definition is subject to constant change
and development depending on the circumstances that prevail in a particular
country at a particular time. Therefore, different countries look at and approach
social security in different ways because cultural, political, historical and economic
factors play a big role in shaping their social security systems.
The International Labour Organisation (ILO) describes social security as follows:
“… it can mean the protection which society provides for its members,
through a series of public measures, against the economic and social distress
that otherwise would be caused by the stoppage or substantial reduction of
earnings resulting from sickness, maternity, employment injury, unemploy-
ment, invalidity, old age and death; the provision of medical care; and the
provision of subsidies for families with children.”
It should be noted that there is no single ILO Convention that deals specifically
with social security and defines the concept. Most of the ILO Conventions focus
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LEARNING UNIT 1: INTRODUCTION TO SOCIAL SECURITY
on various contingencies and on the benefits which must be provided in respect of

those contingencies.
The ILO Social Security (Minimum Standards) Convention 102 of 1952 lists nine risks and
states the type of protection that every social security system must aim to provide, namely
medical care, sickness benefit, unemployment benefit, old-age benefit, employment injury
benefit, family benefit, maternity benefit, invalidity benefit and survivors’ benefit.
The Convention compels each ratifying country to establish a minimum of three

social security branches. At least one of these three must address either
unemployment, old age, invalidity, employment injury, or survivors’ benefits,
and the minimum standards of coverage and benefits must be applied.
In the South African context, social security is described in Chapter 7 of the White
Paper for Social Welfare (1997) (GN 1108 in GG 18166 of August 1997). It reads
as follows:
“Social security covers a wide variety of public and private measures that pro-
vide cash or in-kind benefits or both, first, in the event of an individual’s
earning power permanently ceasing, being interrupted, never developing or
being exercised only at unacceptable social cost and such person being unable
to avoid poverty and secondly, in order to maintain children. The domains of
social security are poverty prevention, poverty alleviation, social compensation
and income distribution.”
The White Paper goes on to list old age, disability, child and family care, and
poverty relief under social assistance and further lists unemployment, ill-health,
maternity, child rearing, widowhood, disability and old age under social protection.
It is important to understand what a social security system in the South African
context should entail as the traditional (Western) concept of social security may not
be able to capture the characteristics of social security in the African context
adequately. This flows from, among other things, the formal sector-based
orientation of the traditional social insurance model; the risks to which most
people on the African continent are exposed; and the role played by informal social
security arrangements in African communities.
Note should be taken that the terms “social security” and “social assistance” are
not clearly defined in South Africa and are very often confused or used
interchangeably with other terms such as “social protection”, “social welfare” and
“social insurance”. Social security must be distinguished from the broader concept
of social protection, which denotes a general system of basic social support which
is founded on the conviction that society as a whole is responsible for its weaker
members.
ACTIVITY 1.1
The concept of social security does not have any fixed definition. Define “social
security” in your own words in the context of South Africa.
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Have you considered how the ILO and the South African White Paper on Social Welfare
describe the concept of social security?
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ACTIVITY 1.2
Make a summary of what you have learned in paragraphs 1.1 and 1.2 above. Write
down only the most important points.
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1.3 THE OBJECTIVE OF SOCIAL SECURITY

Social security comprises measures aimed at providing both financial and social
support to protect people from falling into the poverty trap, and at lifting those
who are already experiencing financial hardships out of poverty. Its objectives
include the promotion of social and economic equality by, among other things,
distributing available resources to those in need and by putting in place a policy
framework within which people are able to protect themselves against certain
economic and social risks if they can afford to do so. Social security assists the
destitute or poor members of society by providing a minimum standard of living
below which no one should fall.
A social security system provides benefits to alleviate poverty. However, this does
not mean that social security is the only way in which poverty can be eradicated
although the most important policies for the relief of poverty fall within the ambit
of social security. Financial support is usually provided in the form of a benefit
payment (for example, payment of social grants) to those considered to be poor or
those who face a drop in their income security with the resultant threat of poverty.
Social security as an income replacement or adjustment system refers to a variety of
policy instruments set up to compensate for the financial consequences of a
number of social contingencies. Social security is not only curative in the sense that
it provides compensation, but also preventative and remedial.
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ACTIVITY 1.3
Write short notes on the role played by social security in the lives of people in general.
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1.4 THE HISTORICAL DEVELOPMENT OF SOCIAL SECURITY IN

SOUTH AFRICA
In the past families, societies and communities always had their own way of
support. African people, for example, relied on kinship-based support from the
family, community or clan.
Kinship-based support is where blood relatives and other members of the household or
extended family support one another.
Families were responsible for the economic and social support of their individual
members. Members of a family who could not participate in survival activities such
as farming and hunting (for example, children, the disabled, pregnant women and
the elderly), received support from their family. This form of support also extended
to the community or clan at large. As time went by, these methods of support were
influenced by Western forms of support which were introduced after colonisation.
This, unfortunately, brought about a social welfare system characterised by racial
discrimination and welfare policies that favoured only whites. This is the reason
why, in 1994, the democratic government inherited a social security system which
reflected elements of Western culture and social values when it took over from the
apartheid regime. One of the big contributors to this change was the migration of
many black people from rural areas to cities in search of jobs mostly in the mines.
Thus, industrialisation and urbanisation contributed to high levels of poverty in
rural areas where the kinship system was badly affected because people, especially
strong and young men, left their rural homes and moved to cities in search of jobs
in factories and mines. The policies applied by the apartheid regime favoured white
people, and black people received fewer benefits.
Separate departments were established to serve the four racial groups, namely
whites, blacks, Indians and Coloureds. Each of the former homelands had its own
Department of Social Welfare even though there were instances where such a
department formed part of the larger combined South African Department of
Health and Welfare. This led to a situation where the country had several
governmental Departments of Welfare. This resulted in a system characterised by
discrimination and fragmented and complicated administrative arrangements.
The birth of democracy in this country not only marked the end of apartheid and
its discriminatory laws and policies, but also brought about important changes in
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how social security is provided in this country. Social security is now recognised as
a fundamental right in section 27 of the Bill of Rights.
The Ministry for Social Welfare and Population Development was established to
separate social services from the Health Ministry. This ministry was later renamed
the Ministry of Social Development. In an effort to reform the country’s social
security system government issued, among other things, the Welfare White Paper
in 1997. The Taylor Committee (Transforming the Present – Protecting the Future:
Report of the Committee of Inquiry into a Comprehensive System of Social
Security for South Africa) was also appointed to look at ways in which a
comprehensive social security system could be developed to extend social security
protection to all who live in this country. The Committee made a number of
recommendations but only a few culminated in legislative reform.
Throughout this module you should keep in mind how South Africa’s social security sys-
tem has developed; how the present system is structured and looks like; the shortcomings
of the system; and the initiatives that have been taken to reform the system.
1.5 THE NATURE OF SOUTH AFRICA’S SOCIAL SECURITY

SYSTEM
Section 27(1)(c) gives everyone the right to have access to social security and social
assistance if they are not able to support themselves and their dependants. The
Social Assistance Act 13 of 2004 gives effect to the provisions of section 27(1)(c)
of the Constitution, which extends social assistance to those who are unable
to support themselves and their dependants. This right to have access to social
security is, however, not absolute as it can be limited in terms of section 27 (2)
(internal limitation) and section 36 (general limitation clause) of the
Constitution. In this regard, take note of section 7(3) of the Constitution which
provides that the rights in the Bill of Rights are subject to the limitations contained
or referred to in section 36 or elsewhere in the Bill of Rights. The provisions of the
Constitution on social security are discussed in more detail in Learning unit 2 below.
Social security consists of social assistance and social insurance but, it in its
broadest sense, includes social welfare and broader concepts such as indirect and
informal social security.
In South Africa, social assistance comprises mainly social grants to the poor and the
indigent.
These grants include the old-age grant, the disability grant and child grants (in the
form of the child support grant, the care dependency grant and the foster-child
grant). Social assistance also provides for social services, social relief and charity.
Beneficiaries of social assistance are those who qualify in terms of policy.
Social assistance benefits are means-tested and they are provided whenever and for
as long as a beneficiary is in need of assistance except those which are payable until
the beneficiary reaches a set age. Social assistance benefits are non-contributory
and can assist people who rely on their own social security strategies (for example,
informal social security) for survival. Public and private roleplayers are involved in
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the provision of social assistance. Social grants are currently regulated in terms of
the Social Assistance Act 13 of 2004 and Regulations thereto. The payment of
social grants is administered by the Social Security Agency (SASSA), which was
established under the South African Social Security Agency Act 9 of 2004. Please
note that social assistance is discussed in more detail in Learning unit 3 below.
The beneficiaries of social insurance are those who are insured in terms of
legislation that establishes the schemes. Beneficiaries may also be chosen in terms
of the rules of a particular scheme and are required to make regular contributions
to the scheme.
In South Africa, social insurance comprises statutory schemes which provide protection
against various social risks such as unemployment, occupational injuries and diseases,
old age/retirement, sickness/invalidity, and injuries occurring as a result of road accidents.
The discussion of these risks and the protection provided against them follows in
Learning unit 4 (unemployment, pregnancy, ill health/incapacity, disability/
invalidity, old age/retirement, road accidents), Learning unit 5 (employment injuries
and diseases) and Learning unit 6 (health) below. For this reason, their discussion in
the following paragraphs is quite brief.
Unemployment insurance (discussed in Learning unit 4 below) is regulated by
the Unemployment Insurance Act 63 of 2001 (UIA) and the Unemployment
Insurance Contributions Act 4 of 2002 (UICA). The former provides for the
payment of unemployment insurance benefits and the latter regulates the collection
of contributions and establishes the Unemployment Insurance Fund. In terms of
the UIA, benefits are paid out in respect of temporary unemployment arising from
(a) the termination of an employee’s services, (b) illness, (c) maternity, and (d)
adoption. The Compensation for Occupational Injuries and Diseases Act 130 of
1993 (COIDA) is the main legislative tool regulating occupational injuries and
diseases in the country (discussed in Learning unit 5 below). The COIDA
provides a system of no-fault compensation for employees who are injured in
accidents that arise out of and in the course of their employment, or who contract
occupational diseases. The Act provides benefits for employees in the case of
permanent and temporary disablement as well as for the dependants of employees
who die as a result of injuries sustained or diseases contracted at work.
The Constitution, in section 27(1)(a), specifically mentions the right of everyone to
access to health care services (discussed in Learning unit 6), including
reproductive health care, and the right not to be refused emergency medical
treatment (section 27 (3)). Health care in South Africa is characterised by a
distinction between public and private provisioning. Private medical schemes are
often linked to formal employment or employment in the formal sector, and are
governed by the Medical Schemes Act 131 of 1998. The White Paper for the
Transformation of the Health System in South Africa, which was published in April 1997,
reports that one of the challenges facing the country’s health care system is to
establish an integrated health system and an effective referral system between the
different levels of care. The objective of the Paper was to find ways through which
most people in the country would be able to enter the health system at the
primary-care level and receive basic care and health education.
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Retirement or old age in South Africa is currently provided for through social
assistance (for poor, qualifying people – discussed in Learning unit 3 below) and
social insurance (for those who work and are able to pay contributions – discussed
in Learning unit 4 below). South Africa currently does not have a national
retirement scheme or what is known as a public fund. As a result, retirement in this
country is mainly provided for by private arrangement. Private retirement
provisioning is governed by the Pension Funds Act 24 of 1956. A high number of
people employed in the formal sector of the economy belong to private retirement
funds (or occupational retirement funds).
Protection given to those who are injured or who died because of road
accidents involving motor vehicles within South African borders is given
through the Road Accident Fund (RAF) (discussed in Learning unit 4). The RAF
provides a social security safety net by making it compulsory for all South African
road users (including foreigners) to be covered. Its objective is to pay
compensation in accordance with the Road Accident Fund Act of 1996 for loss or
damage wrongfully caused by the driving of motor vehicles. The cover takes the
form of indemnity insurance to those who cause the accident.
The traditional view has always been that the scope of social security comprises
only formal social security consisting of social assistance and social insurance.
Consequently, informal and indirect arrangements (discussed in Learning unit
7) have generally been ignored when defining the concept of social security. Even
though not officially recognised as part of the country’s social security system,
informal social security plays a significant role in providing social and economic
support to poor people in this country and has always co-existed with other formal
forms of social security.
In African countries, including South Africa, the concept of informal social security
encompasses arrangements that are kinship based and those which extend beyond
kinship to neighbourhood-based and community-based arrangements. On the
other hand, indirect social security refers to arrangements or services that are not
part of direct social security, but which play an important role in eradicating
poverty and in preventing hardship. The rights to indirect social security include,
among other things, the rights of access to basic energy; housing; communication;
transport; a safe environment; land; food and nutrition; water and sanitation; and
education. Government must make resources available to cater for the needs of
society through indirect social security measures.
ACTIVITY 1.4
Try to summarise the nature of South Africa’s social security in your own words to see if
you have understood how the system is structured.
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1.6 SHORTCOMINGS IN SOUTH AFRICA’S SOCIAL SECURITY

SYSTEM
South Africa has inherited a social security system that is remarkably
comprehensive for a middle-income, developing country. However, a closer look at
the system confirms that the system suffers from many deficiencies. The
exclusionary nature of the system is especially important.
The social assistance system follows a categorical approach, that is, only certain catego-
ries of the indigent are targeted for purposes of social assistance protection, namely the
elderly, children and the disabled.
The levels of benefits provided by various grants remain low and the grants are
insufficient to address the considerable extent of poverty in the country.
Social insurance is designed to address the typical International Labour
Organisation (ILO) risks.
It can therefore be said that the system follows a risk-based approach.
The risk-based approach is too limited for a developing country such as South
Africa, where other risks such as significant capital expenditure, crop failures or
HIV/AIDS also pose a threat to the social security of people, and where there is a
marked difference between typical social security risks in rural and urban areas.
Several categories of people are excluded from social security protection, mainly
because the system follows a limited approach and extends cover only to those
who qualify as “employees”, or those who qualify according to similar terms.
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The present risks against which protection is provided are regulated by legislation
that has been drafted to regulate coverage of such contingencies. This, in turn, has
led to an ad hoc system of coverage of the various risks without a clear, overarching
policy.
There are more than 25 pieces of legislation governing the social security system in
South Africa. The system is characterised by fragmentation as there is still no
coherent social security approach and little synergy in the construction,
establishment, functioning, purpose or cooperation between the schemes. The
regulatory framework is also fragmented: risks such as maternity or death and
survivor benefits are regulated by separate laws. For example, maternity protection
is regulated in terms of the Labour Relations Act 66 of 1995 (LRA), the Basic
Conditions of Employment Act 75 of 1997 (BCEA) and the Unemployment
Insurance Act 63 of 2001 (UIA). Also, the administration of the system is
fragmented since different government departments are in control of different
parts of social benefits/services.
The traditional, limited social security concept, founded on employment-based
social insurance and categorical and means-tested social assistance, is inappropriate
for the South African context. This is true considering the following factors: the
extent of poverty to which the majority of people are exposed; the current
exclusion of many people from the system; the rise in informal employment and
the exclusion of people who are informally employed; constitutional guarantees
that everyone will have access to social security; long-term unemployment;
exclusion of low-income earners and higher-risk categories of people by private
schemes and some of the occupational-based schemes in order to maximise profit;
and the enforceability of socio-economic rights, including the right to have access
to social security. Most of the social insurance schemes provide inadequate
protection as only lost earnings and not future earnings are taken into account.
South Africa’s social security system is mainly compensation focused and little
attention is given to the aims of prevention and integration.
The Taylor Committee looked at ways of making the overall system more inclusive.
One of its recommendations was that an overall strategy or aim for social security
be developed. It proposed that social security be aimed at providing comprehensive
social protection. This would enable the system to address multifaceted poverty,
which it could do by way of a number of measures and a basket of services. The
Taylor Committee recommended a move away from a risk-based approach to an
approach entailing comprehensive social protection (CSP) which could provide
everyone with an adequate standard of living. It must be noted, however, that it will
not be possible to move away completely from a risk-based approach. A CSP
should rather be seen as the overall purpose of the system, whereas previously the
overall purpose was seen as protection against certain social security risks.
ACTIVITY 1.5
You have been tasked by the office of the Minister of Social Development to review
South Africa’s social security system. Write a brief report to the Minister in which you
highlight the most fundamental weaknesses in South Africa’s current social security
system.
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South Africa’s social security system has some positives but many shortcomings, some
of which have been highlighted above. The shortcomings that would require attention
include the limited and exclusionary approaches followed by the system. Can you think
of other shortcomings?
1.7 THE ROLE OF INTERNATIONAL LAW ON THE

DEVELOPMENT OF SOCIAL SECURITY IN SOUTH AFRICA
The introduction of the Bill of Rights in the Constitution of the Republic of South
Africa together with the dawn of democracy in this country have reaffirmed the
country’s commitment to comply with international laws and standards.
Section 39 of the Constitution obliges the courts to consider international law when inter-
preting the Bill of Rights. Section 233 of the Constitution also gives the courts in this coun-
try the duty to prefer any reasonable interpretation of legislation that is consistent with
international law over any alternative interpretation that is inconsistent with international
law whereas section 232, on the other hand, gives recognition to customary international
law provided that it is consistent with the Constitution or an Act of Parliament.
South Africa has ratified some of the international conventions pertaining to social
security. The instruments ratified by South Africa include, among others, the
African Charter on Human and People’s Rights, ratified on 9 July 1996; the United
Nations’ Convention of the Rights of the Child, ratified on 16 June 1995; the
Convention on the Elimination of All Forms of Discrimination Against Women,
ratified on 15 December 1995; and the International Covenant on Economic,
Social and Cultural Rights (ICESCR), ratified on 18 January 2015.
However, even in those instances where South Africa has not yet signed or ratified
certain treaties, the courts of law and other bodies entrusted with the duty of
interpreting the fundamental rights will be compelled by section 39 (1) of the
Constitution to consider international law when interpreting the Bill of Rights.
In the case of S v Makwanyane (1995 (3) SA 391 (CC)), the court held that public
international law includes non-binding as well as binding international law.
International supervisory bodies also play an important role in assisting countries
such as South Africa, to implement international socio-economic rights including
the rights relating to retirement security.
International law includes treaties, conventions, declarations, charters, and
customary international law. Social security is considered to be an internationally
recognised human right which must be respected, protected, promoted and fulfilled
by all governments of the world. In South Africa, a number of statutes provide
both the administrative and regulatory framework for different social security risks.
These statutes give effect to the right to have access to social security and to the
responsibility of the state to take reasonable legislative and other measures to
achieve the progressive realisation of that right as required by section 27(2) of the
Constitution of the Republic of South Africa.
International bodies such as the United Nations (UN) and the International Labour
Organisation (ILO), play a significant role in the promotion and protection of the
right to social security. They are the two most important international bodies in this
regard. The following UN instruments contain important provisions on the right to
social security: the UN Charter, the Universal Declaration of Human Rights, and
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the International Covenant on Economic, Social and Cultural Rights. The ILO
embodies several Conventions and Recommendations which contain provisions on
the right to social security. Among these are the Social Security (Minimum
Standards) Convention 102; the Convention on the Elimination of All Forms of
Discrimination Against Women (CEDAW); and the Income Security
Recommendation 67 of 1944.
The ILO Conventions set standards to be followed by member countries when
making national laws. The requirements set by the Conventions are aligned with
the minimum level guaranteed by the Conventions, which is known as the
minimum core content or core obligation.
A core content refers to the essential element or elements without which a right loses its
substantive significance as a human right, and in the absence of which a state that is
party to the ILO Conventions should be in violation of its international obligations. A core
content has also been described as a floor below which conditions should not be allowed
to fall.
The ILO Conventions are therefore designed to ensure minimum coverage.

Compliance with the standards is monitored by the ILO and the legal status of a
ratified ILO Convention is that of an international treaty. Supplementary schemes
providing benefits over and above those of the basic standards provided for by the
Conventions may be instituted entirely according to the wishes of an individual
national legislator.
ACTIVITY 1.6
Describe the role played by international law/standards in the development of social
security in South Africa.
Among other things, member states (countries that have ratified and signed relevant
conventions) must follow the set international standards when making laws or develop-
ing relevant social security policies.
1.8 THE ADMINISTRATION OF SOCIAL SECURITY IN SOUTH

AFRICA
Social security organisations operate at different levels, namely at central, regional
and local level. Their focus is mainly on policy and coordination at central level and
on delivery at local level. Social assistance is provided by government under the
Department of Social Development through the South African Social Security
Agency, whereas social insurance is provided by both government and private
institutions (the latter in the form of, for example, insurance companies and private
funds). Here government plays a predominantly regulatory and supervisory role.
1.9 THE FINANCING OF SOCIAL SECURITY IN SOUTH AFRICA

Social security schemes are either contributory or non-contributory.
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Non-contributory schemes take the form of social assistance arrangements which are
funded by government through tax revenue.
A means test is applied to determine if the applicant for social assistance qualifies
to receive the grant.
Social insurance, on the other hand, is financed through contributions made by
people who work so that they are eligible for benefits during periods when they
cannot work because of, for example, ill health, disability, unemployment or old age.
Contributions are made by both employer and employee. The employer deducts a
contribution from each employee’s wages. These contributions are then transferred
to a special fund as a type of insurance premium to protect the employee against a
possible risk. The amount of contributions and benefits payable are generally
determined by the rules of each fund. The Road Accident Fund is funded by a levy
on fuel sold in the Republic (section 1(2)(a)(ii) of the Central Energy Fund Act 38
of 1977) and by raising loans.
1.10 ENFORCEMENT OF THE RIGHT TO SOCIAL SECURITY

The social security system in this country makes provision for legal remedies and
adjudication measures through various pieces of legislation, for example, the Social
Assistance Act of 2004 with respect to social assistance and the Unemployment
Insurance Act of 2001 in relation to unemployment benefits. The Constitution,
as the supreme law of the country, also guarantees everyone the right to just
administrative action and the right of access to the courts.
Anyone who is aggrieved by the manner in which they have been treated in terms
of a particular social security statute may rely on these remedies. Aggrieved people
may also resort to common law or administrative law remedies before a court that
has jurisdiction to hear the matter. The Constitution enjoins every court, tribunal
or forum to promote the spirit, purport and objects of the Bill of Rights when
interpreting any legislation and developing common law. The Constitution grants
the courts the power to adjudicate on and review laws or conduct for constitutional
consistency. Courts also have the power to grant appropriate relief to rectify
violations of the Bill of Rights. They also play a supervisory role which may involve
giving orders, directing the legislative and executive branches of government to
bring about reforms defined in terms of their objectives, and retaining supervisory
jurisdiction over the implementation of these reforms. The enforceability of socio-
economic rights is discussed in Learning unit 2 below.
ACTIVITY 1.7
Read the following scenario and answer the question.
X qualifies for social assistance for elderly people. He has applied for the grant
and a year has passed without receiving any communication from the Department
of Social Development or the Social Security Agency indicating whether his appli-
cation was approved or not. Is there anything that X can do to force the
Department or Agency to attend to his application?
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Social security rights are enforceable, and the Constitution has special provisions that
X can rely upon in this regard as discussed above.
ACTIVITY 1.8
Write only the most important points on the administration, financing (of social security)
and enforcement of social security rights in South Africa.
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SELF-ASSESSMENT QUESTIONS
(1.1) Complete the following provision of section 27(1)(c) of the Constitution of the Re-
public of South Africa 1996 by filling in the TWO missing words:
Everyone has the right to have access to ____________________, including, if
they are unable to support themselves and their dependants, appropriate
_____________________.
(1.2) Describe the nature of South Africa’s social security system.
(1.3) Describe the concept of social security.
(1.4) Define social security in your own words.
(1.5) Describe social assistance.
(1.6) Describe social insurance.
(1.7) Describe the historical development of the South African social security system.
(1.8) Explain how social security is administered in South Africa.
(1.9) Explain how social security is financed in South Africa.
(1.10) Describe the shortcomings in South Africa’s social security system.
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1.11 CONCLUSION
You should now have a better grasp of what social security entails. You should also have
an idea of the nature of the social security system in South Africa.
In Learning unit 2, we will look at the constitutional provisions on the right of

access to social security.
1.12 GLOSSARY
Social security Monetary assistance from the state for people earning an inad-
equate income or no income at all.
Security The state of being free from any threat or harm.
Assistance The action of helping someone by sharing resources.
Insurance An arrangement by which a company or the state undertakes to
provide a guarantee of compensation for specified loss, damage,
illness or death in return for payment of a specified premium.
Formal Something that is officially sanctioned or recognised.
Informal To have a relaxed or unofficial style, manner or nature.
System A set of principles or procedures according to which something
is done; an organised scheme or method.
Risks A situation involving exposure to danger.
Shortcomings A fault or failure to meet a certain standard, typically in a per-
son’s character, in a plan or a system.
Contributory Payment of money into a fund to receive protection against cer-
tain social risks.
Non- Where beneficiaries do not pay any money to be eligible to re-
contributory ceive benefits. For example, beneficiaries of social grants do not
pay any contributions.
Scope The extent of the area or subject matter that something deals
with or to which it is relevant.
Fragmentation The process or state of breaking or being broken into
fragments.
Public For the use of or concerning the people as a whole.
Private For the use of chosen people or of one particular person.
Adjudicate To make a formal judgement on a disputed matter.
Targeted Selected as an object of attention or focus.
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ACTIVITY 1.9
Write a brief overview of Learning unit 1.
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1.13 OUTCOMES ACHIEVED

You should be able to
● understand the concept of social security
● describe the objectives of social security
● distinguish between different components of social security
● describe the historical development of South Africa’s social security system
● describe the nature of South Africa’s social security system and its shortcomings
● describe the role of international law in the development of South Africa’s social se-
curity system
● explain how social security in South Africa is administered and financed
● explain how social security rights can be enforced
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Learning unit 2
Constitutional and rights-based framework
Learningunit2
Contents
2.1 INTRODUCTION 21
2.2 THE SUPREMACY OF THE CONSTITUTION 21
2.3 OBLIGATIONS ARISING FROM THE CONSTITUTION 22
2.4 THE SCOPE OF EVERYONE’S RIGHT TO HAVE ACCESS TO SOCIAL
SECURITY 23
2.4.1 General 23
2.4.2 “Everyone’s” right to have access to social security 23
2.4.3 The “right to have access to” 24
2.4.4 “Including if they are “unable” to support themselves and give their
dependants appropriate social assistance” 24
2.4.5 The state must take reasonable legislative and other measures, within its
available resources, to achieve the progressive realisation of each of the
rights in section 27 25
2.4.5.1 Reasonable legislative and other measures 25
2.4.5.2 Within available resources 26
2.4.5.3 Progressive realisation 26
2.5 THE RIGHT TO EQUALITY IN RELATION TO THE RIGHT TO HAVE
ACCESS TO SOCIAL SECURITY 27
2.6 DISCRIMINATION AND DIFFERENTIATION 28
2.7 DIRECT AND INDIRECT DISCRIMINATION 28
2.8 GENERAL LIMITATION TO THE RIGHT TO HAVE ACCESS TO SOCIAL
SECURITY 29
2.9 ENFORCEMENT, ADJUDICATION AND MONITORING OF SOCIAL
SECURITY PROVISIONS 30
2.10 CONCLUSION 31
2.11 GLOSSARY 31
20
Students should take approximately 4 hours to work through this learning unit.
This learning unit discusses the constitutional provisions on the right to have
access to social security and the scope of this right, constitutional supremacy, the
right to equality, enforcement of the right to have access to social security and the
limitation of the right – in the South African context.

● describe the constitutional provisions on the right to have access to social security
● explain how the Constitution impacts on social security provision in South Africa
● describe the scope of the right to have access to social security in the South African
context
● explain how the right to have access to social security can be limited
● describe what unfair discrimination is and how it is prohibited in terms of the
Constitution
● draw a distinction between discrimination on a listed ground and discrimination on
an unlisted ground
● draw a distinction between direct and indirect discrimination
● explain how discrimination can be justified
● explain how the right to have access to social security can be enforced
2.1 INTRODUCTION
The Constitution of the Republic of South Africa, 1996, makes provision for
fundamental rights in its Bill of Rights. The right to have access to social security is
one of the fundamental rights recognised in the Bill of Rights. This right, as
provided for in section 27 of the Constitution, is of great importance as it is also
recognised in international human rights law.
Section 27 provides as follows:
(1) Everyone has the right to have access to –

(a) health care services, including reproductive health care;
(b) sufficient food and water; and
(c) social security, including, if they are unable to support themselves and
their dependants, appropriate social assistance.
(2) The state must take reasonable legislative and other measures, within its avail-
able resources, to achieve the progressive realisation of each of these rights.
(3) No one may be refused emergency medical treatment.
Section 27(1)(c), in particular, guarantees everyone the right to have access to social
security including, if they are unable to support themselves and their dependants,
appropriate social assistance. It can be deduced from the provisions of this section
that social security is viewed from the constitutional perspective as an umbrella
concept that covers social assistance and social insurance.
2.2 THE SUPREMACY OF THE CONSTITUTION

The Constitution of the Republic of South Africa is the supreme law of the
country and any law or conduct inconsistent with it is invalid. The obligations
imposed by the Constitution must be fulfilled. In addition, the state is obliged to
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LEARNING UNIT 2: CONSTITUTIONAL AND RIGHTS-BASED FRAMEWORK
respect, protect and promote the rights in the Bill of Rights. The aims of the
Constitution include: to heal the divisions of the past; to establish a society based
of democratic values, social justice and fundamental rights; to improve the quality
of life of all citizens; and to free the potential of each person. Social security can
play an important role in ensuring social justice by freeing the potential of all
citizens and by improving their quality of life.
Section 1 of the Constitution contains values on which the country is founded, namely hu-
man dignity, the achievement of equality and the advancement of human rights and
freedoms.
For example, in Government of the Republic of South Africa and others v Grootboom 2001
(1) SA 46, which deals with the right to have access to adequate housing (section 26
(1)), the court relied heavily on the right to human dignity as a core value
underlying all other human rights.
2.3 OBLIGATIONS ARISING FROM THE CONSTITUTION

The Bill of Rights, which enshrines the fundamental rights of all our people, is
entrenched in the Constitution and, in terms of section 8 of the Constitution, binds
the executive, the judiciary and all organs of state, as well as natural or juristic
persons. This includes institutions regarded as private but conform to the
definition of “organ of state”. In terms of general constitutional law, an organ of
state acts as a functionary of the state. Non-state organs also occupy a central
position in the provision of key services and goods essential for the day-to-day life
of individuals. The Bill of Rights has vertical operation by virtue of the fact that it
is primarily directed at protecting the fundamental human rights and freedoms of
the individual against infringement by the state.
The Bill of Rights also applies horizontally in that it grants protection against
infringements of fundamental rights by private third parties. In terms of section 8
(2) of the Constitution, the Bill of Rights binds both natural and juristic persons to
the extent that the rights are applicable taking into account the nature of the rights
and any duty imposed by the rights. The horizontal application of the Bill of Rights
may also be effected through legislation. Some of the provisions in the Bill of
Rights instruct the state to enact legislation to give effect to the rights entrenched
in the Constitution. For example, section 9(4) of the Constitution requires the state
to prevent or prohibit unfair discrimination. In this case, South Africa has the
Employment Equity Act 55 of 1998 and the Promotion of Equality and Prevention
of Unfair Discrimination Act 4 of 2000 which were enacted in order to achieving
that purpose.
Section 7(2) of the Constitution requires the state to respect, protect, promote and
fulfil everyone’s rights. This duty gives the beneficiaries the right to require
positive assistance or a benefit or service from the state. The duty places a
positive duty on the state to do something and can also be interpreted to mean
that the courts can enforce social security rights and order state organs and
private institutions to act positively with regard to everyone’s right to have
access to social security.
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On the other hand, section 27 (2) of the Constitution obliges the state to take
reasonable legislative and other measures, within its available resources, to achieve
the progressive realisation of the right to have access to social security. The
obligation includes the adoption of enabling strategies to assist people to gain
access to the rights through their own endeavours and initiatives, as well as more
direct forms of assistance to groups in disadvantaged or vulnerable circumstances.
The state needs to take reasonable legislative measures together with well-directed
policies and programmes, for example, by making policy and law that would
allow people to establish or join social insurance schemes that are available in the
country. These policies and programmes must be reasonable both in their
conception and implementation, and the provision of services or access to the right
will depend on the availability of resources.
ACTIVITY 2.1
What does the duty of the state to respect, protect, promote and fulfil everyone’s right to
have access to social security in South Africa entail?
● It includes the right to require positive assistance or a benefit or service from the
state.
● It places a positive duty on the state to do something and can also be interpreted to
mean that the courts can enforce social security rights and order state organs and
private institutions to act positively with regard to everyone’s right to have access to
social security.
2.4 THE SCOPE OF EVERYONE’S RIGHT TO HAVE ACCESS TO

SOCIAL SECURITY
2.4.1 General
Section 27 of the Constitution guarantees everyone the right to have access to
social security. On the other hand, section 27(2) serves as a qualifier to section 27
and provides an ‘internal limitation’ to the right to have access to social security.
Critical elements of section 27 are discussed below:
2.4.2 “Everyone’s” right to have access to social security

The right to have access to social security is for everyone.
The word “everyone” in this section must be interpreted to include non-citizens with per-
manent residence as in Khosa and others v The Minister of Social Development and
others; Mahlaule and others v The Minister of Social Development and others (2004) (6)
SA 505 (CC).
In this way, the Constitution imposes an obligation on the state to ensure universal
access to social security. Before the Khosa decision, non-nationals were generally
excluded from the South African social security system, except in extraordinary
cases. It should be remembered that section 9 of the Constitution guarantees
everyone equality before the law and equal protection and benefit of the law. The
fundamental right to equality enshrined in section 9 underpins the right of
everyone to have access to social security. This means that, constitutionally,
there is no basis for excluding anyone, including non-nationals, from enjoyment of
the right – though a distinction may be drawn between the treatment of legal and
illegal immigrants.
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2.4.3 The “right to have access to”

Section 27 of the Constitution refers to the right to have “access to” social
security and not “the right to” social security.
This should be interpreted to mean that one does not automatically have a right to social
insurance and social assistance, but that one has a right to apply for it.
This wording also means that the right to social security and other socio-economic
rights are not items that must be handed out free of charge by the government to
the people. The state’s role is to create an “enabling environment” which makes
it possible for people to gain access to these rights, remove obstacles in the way of
people who are gaining access to the rights, and adopt measures to assist those
without access to gain such access.
The state is obliged by section 27 (2) to ensure, by way of legislative and other
measures, that everyone has access to social security. For example, the state must
create the necessary infrastructure to enable beneficiaries of social assistance to
collect their social assistance grants.
2.4.4 “Including if they are “unable” to support themselves and give

their dependants appropriate social assistance”
The right to have access to social assistance is restricted to those who are “unable”
to support themselves and their dependants.
In this section, “unable” would mean that the right is extended to those who cannot pro-
vide for their own or their dependants’ basic needs either because they are poor, old or
very young, or because they are living with a physical or mental disability.
These are the groups presently catered for under the social assistance programmes.
“Appropriateness”, in this regard, must be evaluated in relation to the purpose of the right
to social assistance which is to ensure that everyone has a sufficient income or in-kind
benefits to meet their basic subsistence needs and also to make sure that all have human
dignity.
The level of benefits should ensure that no one falls below the poverty line in the
South African context.
ACTIVITY 2.2
Explain what the following concepts mean in the context of how the right to have
access to social security is applied in South Africa: “everyone”, “the right of access to”,
“unable to”, “appropriateness”.
● “Everyone” includes non-citizens with permanent residence. This is to ensure uni-

versal access to social security.
● “The right of access to” means that one does not automatically have a right to social
insurance and social assistance, but that one has a right to apply for it.
● “Unable to” signifies being unable to provide for one’s basic needs or dependants’
basic needs.
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● “Appropriateness” means assistance that is sufficient, meets people’s basic subsis-

tence needs, and makes sure that all have human dignity.
2.4.5 The state must take reasonable legislative and other measures,
within its available resources, to achieve the progressive
realisation of each of the rights in section 27
Even though the Constitution imposes an obligation on the state to ensure access
to social security, the Constitution also gives the state a degree of latitude in
relation to this right.
Section 27(2) provides for the following important aspects: the progressive realisation of
the right of access to social security; the taking of reasonable legislative and other meas-
ures; and the availability of resources.
These aspects are discussed below.
2.4.5.1 Reasonable legislative and other measures

In order to be reasonable, a state programme must establish a coherent plan
directed towards the progressive realisation of the right within available
resources. The programme must be capable of facilitating the realisation of the
right, but the exact packaging and content of the measures to be adopted are for
the legislature and executive to decide. The measures can consist of legislation or
policies and programmes. The reasonableness of the programme will be
determined by its content as well as by the way in which it is implemented. The
programme must also be reasonable in terms of its introduction and execution.
It must be balanced and flexible and must make appropriate provision for attention
to crises, as well as short-, medium- and long-term needs. A programme that
excludes some members of society cannot be reasonable (Government of the Republic
of South Africa v Grootboom 2001 (1) SA 46; Minister of Health and Others v Treatment
Action Campaign and Others (2) 2002 (5) SA 721 (CC)).
ACTIVITY 2.3
Write in point form the characteristics/elements of a state programme that is reasonable.
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2.4.5.2 Within available resources

The right to have access to social security can be limited by a lack of resources.
This serves as an “internal limitation” of the right. The implication is that the state
is compelled to fulfil the right to have access to social security only within its
available resources. As a result, the realisation of the right to have access to social
security is dependent on positive action from the state by, among other things,
allocating part of the budget towards the progressive realisation of the right. It
should be noted that even though the State is obliged to make sure that the right to
have access to social security is realised by everyone, such realisation may be limited
by the availability of state financial resources (Minister of Health and Others v Treatment
Action Campaign and Others (2) 2002 (5) SA 721 (CC); Soobramoney v Minister of Health
(Kwazulu-Natal) 1998 1 SA 765 (CC).
ACTIVITY 2.4
Explain how the “availability of resources” can be a limitation to the right to have access
to social security.
The state is compelled to fulfil the right to have access to social security only within its
available resources.
2.4.5.3 Progressive realisation

The right to have access to social security will have to be progressively realised.
The question is whether a time frame can be assumed from this phrasing.
Progressive realisation imposes an obligation to move as expeditiously and
effectively as possible towards the goal.
Progressive realisation recognises that full realisation will not be achieved within a short
period of time.
It necessitates the development of a realistic and comprehensive plan or

programme which indicates how the fundamental rights concerned will be
gradually developed. This means that “accessibility” should be progressively
facilitated and that all hurdles (such as legal, administrative, operational and
financial obstacles) should be identified and, where possible, lowered over
time. This can be interpreted to mean that the state may exercise discretion but
that, in doing so, the state must ensure that it provides a certain core content
(Government of the Republic of South Africa v Grootboom 2001 (1) SA 46).
ACTIVITY 2.5
Describe the nature and scope of the right to have access to social security (in the
South African context) to your social security classmate. Make sure that you cover all
the important aspects.
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The Constitution guarantees the right “to have access to” and not the “right to”. What
this means, is that people have the opportunity to apply for the services or benefits –
they do not have automatic access to the benefits. Section 27 recognises two compo-
nents, namely social assistance schemes or funds (for example, social grants) and so-
cial insurance schemes or funds (that, for example, protect people, in particular
employees, from specified social risks such as unemployment and retirement). This
right is not absolute and can be limited in two ways. Firstly, section 27 (2) (which is a
qualifier to this right or what is called an “internal limitation”) provides that the state must
take reasonable legislative and other measures, within its available resources, to
achieve the progressive realisation. In terms of this provision, the state is required to
have in place programmes that provide for a coherent plan directed towards the pro-
gressive realisation of the right within available resources. Measures taken by the state
should comprise legislation, programmes and relevant policies. The right to have ac-
cess to social security will have to be progressively realised. This recognises the fact
that full realisation might not be achieved immediately or within a short period of time.
The right to have access to social security can also be limited by a lack of resources.
Secondly, the right may be limited by the “general limitation clause” (or external limita-
tion) in section 36 of the Constitution (see in this regard the discussion under paragraph
2.8 below).
2.5 THE RIGHT TO EQUALITY IN RELATION TO THE RIGHT TO

HAVE ACCESS TO SOCIAL SECURITY
Section 9 (1) of the Constitution guarantees everyone equality before the law and equal
protection and benefit of the law. Section 9 (2) actively promotes the achievement of
equality for those who have been disadvantaged as a result of past discriminatory practi-
ces. Subsections (3) and (4) further provide that neither the state nor any individual may
discriminate against any person on one or more of the grounds listed under subsection
(3).
Section 9(3) provides that the state may not unfairly discriminate, either directly or
indirectly, against anyone on one or more grounds including race, gender, sex,
pregnancy, marital status, ethic or social origin, colour, sexual orientation, age,
disability, religion, conscience, belief, culture, language and birth. In terms of
section 9(5), once discrimination on one of the specified grounds is established, it
is deemed to be unfair.
The following factors must be taken into account when making a determination as to
whether discrimination is fair or unfair (the guidelines provided by the court in Harsken v
Lane NO & others 1998 (1) (SA) 300 (CC)): the position of the complainant in society and
whether the complainant was a victim of past patterns of discrimination; the nature of the
provision or power and the purpose sought to be achieved by it; whether the primary pur-
pose was to achieve a worthy and important societal goal and whether an attendant con-
sequence of that was an infringement of the applicant’s rights; and the extent to which the
rights of the complainant had been impaired and whether there had been an impairment
of his or her fundamental dignity).
ACTIVITY 2.6
Read the following scenario and answer the question. The Dinaledi Municipality has a
housing policy which provides that only married men and women qualify for low-cost
houses. When Lebo, a thirty-year-old unmarried mother of three applies for a house,
she is told that she does not qualify because she is not married. Discuss whether Lebo
is being discriminated against or not. If she is, mention the grounds on which she is
being discriminated against.
SSL2601/1 27
Lebo is being discriminated against on the basis of sex and marital status. A presump-
tion of unfair discrimination arises when a person is being discriminated against on any
of the grounds listed in section 9 (3) of the Bill of the Rights. You need to know and
understand the difference between discrimination on listed grounds and discrimination
on unlisted ground/s.
2.6 DISCRIMINATION AND DIFFERENTIATION

Discrimination is usually incorrectly equated with differentiation. Differentiation
does not always amount to discrimination.
Differentiation takes place when members of the same group or category are not treated
the same, for example, when some people receive benefits and others don’t, or when em-
ployees occupying similar positions are paid different salaries.
Employees are usually subjected to differentiation for reasons that include

experience, seniority or educational qualifications.
Differentiation can turn into discrimination if it is based on unacceptable
grounds. For example, no one should be subjected to differentiation on any
grounds listed in section 9 (3) of the Constitution and section 6 (1) of the
Employment Equity Act (which adds family responsibility, political opinion, and
HIV status to the grounds listed in section 9(3) of the Constitution).
It should be noted that the list in section 6(1) of the Employment Equity Act is not
exhaustive, which implies that it is possible to allege unfair discrimination on a
ground that is not listed in the section as long as the person alleging
discrimination can identify the unlisted ground and convince the court that
it passes the test – for example, whether the ground is based on attributes and
characteristics which have the potential to impair the fundamental human dignity
of persons as human beings or to affect them adversely in a comparably serious
manner.
ACTIVITY 2.7
Draw a clear distinction between “discrimination” and “differentiation”.
Differentiation: when people of the same group or category are not treated the same.
Discrimination: when people are subjected to differentiation on the basis of any of the
listed grounds.
2.7 DIRECT AND INDIRECT DISCRIMINATION

Direct discrimination refers to situations in which some people are treated
differently on the basis of their race, sex, religion, sexual orientation or other
protected trait. On the other hand, indirect discrimination occurs when an
employer uses an employment practice that is neutral on the face of it, but that
disproportionately affects members of disadvantaged groups in circumstances
where this is not justifiable. The notion of equal treatment underpins direct
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discrimination provisions and is based on the familiar principle that “likes should
be treated alike”.
Indirect discrimination recognises the fact that equal treatment might produce
unequal results if the relevant subjects are socially unequal to start with – for
example, where an employer applies a policy that appears to be equally neutral to
all employees, but which has a disproportionate effect on a certain group of
employees.
ACTIVITY 2.8
Discuss whether it will constitute unfair discrimination or differentiation to refuse to
register the gay partner of a contributor to a medical fund as a dependant.
This will amount to direct discrimination because of sexual orientation. Discrimination

on this ground is expressly prohibited in terms of section 9(3) of the Bill of Rights.
2.8 GENERAL LIMITATION TO THE RIGHT TO HAVE ACCESS TO

SOCIAL SECURITY
Fundamental rights, including the right to have access to social security, are not
absolute. The right to have access to social security can be limited. In terms of
section 7 (3) of the Constitution, the rights in the Bill of Rights are subject to
limitations contained in section 36 or stipulated elsewhere in the Bill of Rights.
There are two forms of limitations which the right to have access to social security
is subject to.
Firstly, the right may be limited by the general limitation clause (or external limitation) in
section 36 of the Constitution. In this regard, the limitation must comply with the require-
ments set out in the section. As far as the limitation under section 36 is concerned, the
limitation of the right is subject to a threefold test in terms of which the limitation must be:
(a) in terms of a law of general application, (b) reasonable and (c) justifiable in an open
and democratic society based on human dignity, equality and freedom.
Secondly, the limitation can be justified based on the specific qualifications contained in
respect of a particular right. This is referred to as internal limitation. It must be clear that it
is the right of access to and not the right to. On the other hand, section 27(2) provides that
the state must take reasonable legislative and other measures, within its available
resources, to achieve the progressive realisation of each of the rights in section 27 of the
Constitution. This provision constitutes an internal limitation of the right to have access to
social security. See in this regard the discussion of the provisions of section 27(2) under
paragraph 2.4.5 above.
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ACTIVITY 2.9
Make a summary of the constitutional provisions that demonstrate the fact that the right
to have access to social security can be limited.
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2.9 ENFORCEMENT, ADJUDICATION AND MONITORING OF

SOCIAL SECURITY PROVISIONS
The right to have access to social security and other socio-economic rights are
justiciable and can therefore be enforced by the courts of law (Ex Parte
Chairperson of the Constitutional Assembly: In Re Certification of the Constitution of the
Republic of South Africa 1996 (4) SA 744 (CC)).
The state’s duty to respect, protect, promote, and fulfil the right to have access to social
security may be understood to mean that the courts can enforce social security rights and
order institutions involved in the provision of social security to act positively with regard to
this right.
The courts, tribunals and forums are also enjoined by section 39 (2) of the
Constitution to promote the spirit, purport, and objects of the Bill of Rights when
interpreting any legislation and when developing the common law. As the supreme
law of the country, the Constitution in section 172 (1) (a) grants the courts the
power to adjudicate on and review laws or conduct for constitutional consistency.
In terms of section 38 of the Constitution, the courts have the power regarding the
Bill of Rights to grant appropriate relief to rectify violations of the Bill of
Rights. The courts also play a supervisory role. This role involves the courts
giving orders; directing the legislative and executive branches of government to
bring about reforms defined in terms of their objectives; and retain supervisory
jurisdiction over the implementation of these reforms. In terms of section 38 of
the Constitution, anyone acting in their own interest; anyone acting on behalf of
another person who cannot act in his or her own name; anyone acting as a member
of or in the interest of a group or class of persons; anyone acting in the public
interest; and an association acting in the interests of its members has the right to
approach a competent court, alleging that a right in the Bill of Rights has been
infringed or threatened, and the court may grant appropriate relief – including a
declaration of rights. In Fose v Minister of Safety and Security ((1997) (3) SA 786 (CC)
par 19) appropriate relief was described to mean: “… relief that is required to
protect and enforce the Constitution. The relief may take the form of a declaration
of rights, a mandamus or such other relief as may be required to ensure that
constitutional rights are protected and enforced, but this will depend on the
30
circumstances of each particular case. The courts may even have to create new
remedies in ensuring that rights are protected and enforced.”
Thus section 38 of the Constitution empowers the courts of law to intervene and
assist social security beneficiaries where entitlements to social security benefits or
services are not honoured. Section 33 of the Constitution also gives everyone the
right to just administrative action and the right of access to courts. On the other
hand, section 33 (1) of the Constitution provides that everyone has the right to
administrative action that is lawful, reasonable, and procedurally fair.
(2.1) Write an analysis of the provisions of sections 27 (1) (c) and 27 (2) of the
Constitution.
(2.2) Describe unfair discrimination.
(2.3) Draw a distinction between discrimination and differentiation.
(2.4) Draw a distinction between direct and indirect discrimination.
(2.5) Read the scenario and answer the question. Mpho has enrolled at university to
study social security law. Mpho is puzzled by the fact that some of the rights in the
Bill of Rights, including the right to have access to social security, can be limited.
He wonders how that can be possible when there are so many poor people out
there. Explain to Mpho how the right to have access to social security can be
limited.
(2.6) Explain how the right to have access to social security can be enforced.
(2.7) Explain “unable” and the right “to have access to” within the context of section 27
of the Constitution.
(2.8) Explain what “reasonableness” in section 27(2) entails.
(2.9) Explain what “progressive realisation” entails.
(2.10) Describe an “internal limitation” and an “external limitation” of the right to have ac-
cess to social security.
2.10 CONCLUSION
The obligations contained in the Constitution serve as an impetus to the present
social security system in South Africa.
You should, by now, understand the impact of the Constitution on South Africa’s social se-
curity system and of how the Constitution deals with discrimination. You should also be
able to identify and interpret constitutional provisions that promote and protect the right to
have access to social security, know the difference between discrimination and differentia-
tion, and understand how the right to have access to social security can be limited.
In the next learning unit, we discuss one component of formal social security in
South Africa, namely social assistance.
2.11 GLOSSARY
Legislative Having the power to make laws; relating to legislation.
Supervisory Relating to the role of observing and directing an activity
or a person.
Obligation An act or course of action to which a person is morally or
legally bound; a duty or commitment.
Available To be able to be used or obtained.
Provision The action of providing or supplying something for use.
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Socio-economic It relates to the interaction of social and economic factors.

Progressive Happening or developing gradually or in stages.
Differentiate To treat or look at people/things differently.
Fundamental Something of great/central importance.
Dignity The state of being worthy of respect.
Discriminate To make an unjust or prejudicial distinction in the treat-
ment of different categories of people.
Constitutional Allowed by the Constitution.
Fairness To treat everyone equally or in a way that is right or
reasonable.
Limit A point or level beyond which something does not or may
not extend or pass.
Unfair Not based on the principles of equality and justice.
ACTIVITY 2.10
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You should be able to:
● describe the constitutional provisions on the right to have access to social security
● explain how the Constitution impacts on social security provision in South Africa
● describe the scope of the right to have access to social security in the South African
context
● explain how the right to have access to social security can be limited
● describe what unfair discrimination is and how it is prohibited in terms of the
Constitution
● draw a distinction between discrimination on a listed ground and discrimination on
an unlisted ground
● draw a distinction between direct and indirect discrimination
● explain how discrimination can be justified
● explain how the right to have access to social security can be enforced
32
Learning unit 3
Social assistance
Learningunit3
Contents
3.1 INTRODUCTION 34
3.2 GRANTS PAYABLE IN TERMS OF THE SOCIAL ASSISTANCE ACT 13 OF
2004 35
3.2.1 General 35
3.2.2 Child grants 36
3.2.2.1 Introduction 36
3.2.2.2 Child support grant 37
3.2.2.3 Care dependency grant 38
3.2.2.4 The foster-child grant 39
3.2.2.5 Old-age grant 40
3.2.2.6 Disability grant 40
3.2.2.7 Grant-in-aid 41
3.2.2.8 War veteran’s grant 41
3.2.3 Administration of social grants in South Africa 41
3.3 SOCIAL RELIEF 43
3.4 HARDSHIP CAUSED BY THE STATE 45
3.5 CONCLUSION 47
3.6 GLOSSARY 47
This learning unit looks at social assistance measures in South Africa; various
grants provided for under the Social Assistance Act 13 of 2004; the administration
of social grants; social relief of distress; assistance given to people who suffer
hardship caused by the state; and challenges facing the provision of social
assistance in South Africa.
SSL2601/1 33
LEARNING UNIT 3: SOCIAL ASSISTANCE

● describe social assistance
● describe different social grants
● identify the eligibility requirements for each social grant
● explain how a person can apply for a social grant
● define the concept of social relief of distress
● describe the functions of the Social Security Agency (SASSA)
● advise a person upon whom the state has inflicted harm about compensation to
which he or she may be entitled
3.1 INTRODUCTION
Before formal social security such as social assistance, was introduced (before the
colonial era); societies and family members were mainly provided for through
kinship-based systems.
With kinship-based support, the family was the primary institution through which the basic
needs of individuals were met.
Children, elderly people, pregnant women, the disabled and the sick whose
productive capacities were limited or impaired, received support from their families.
Support also extended beyond the immediate family to the wider clan or
community. However, these traditional methods of support were later on
influenced by the Western way of support which took on a more formal form that
included formal social assistance provided by the state.
Social assistance is a state-provided basic minimum protection which aims to relieve pov-
erty. It is sort of a safety net that provides assistance in cash or in kind to people who lack
the means to support themselves and their dependants.
This is in line with the promise made under section 27 (1) (c) of the Constitution
that those who are “unable” [the term “unable” is described in Learning unit 2
above] to support themselves and their dependants will be given access to
appropriate social assistance.
It should be remembered that the obligations of the state in this section are
qualified by section 27 (2) which provides that the state must take reasonable
legislative and other measures, within its available resources, to achieve the
progressive realisation of the right.
The main objective of social assistance is to alleviate poverty through, amongst other
things, the provision of minimum income support.
It is subject to qualifying criteria and is provided on a non-contributory basis.

Assistance is given to only those who meet the eligibility requirements and pass the
means test. The means test entails that the income and assets of the applicant will
be evaluated to see if he or she qualifies for assistance. This is to ensure that only
those who are in need receive assistance. Social assistance is categorical in
nature as it covers certain risks such as disability and old age. Its provision is
34
regulated by the Social Assistance Act 13 of 2004. The social grants payable under
the Act include: the child support grant, the care dependency grant, the
foster-child grant, old-age grant, disability grant and the war veterans’ grant.
The child support and old-age grants are the largest social assistance grants
provided by government in this country.
ACTIVITY 3.1
Explain how African people used to receive support in the olden days, in other words,
before formal social assistance was introduced.
In the olden days and before formal social security was introduced, societies and mem-
bers of the family were supported through a kinship-based system. According to this
system, members of a family who, because of their age (for example, children and the
elderly), a disability or sickness, could not participate in activities such as farming or
hunting, were supported by their family.
ACTIVITY 3.2
Describe “social assistance” in your own words.
It is state provided; it offers a basic minimum protection which aims to relieve poverty; it
is subject to qualifying criteria which include a means test; it is non-contributory in na-
ture; it is funded from government revenue; and it mainly takes the form of grants.
3.2 GRANTS PAYABLE IN TERMS OF THE SOCIAL ASSISTANCE

ACT 13 OF 2004
3.2.1 General
The Social Assistance Act of 2004 provides for, among other things, the
administration of social assistance and the payment of social grants. The Act
provides social assistance to South African citizens and permanent residents.
A South African citizen, in terms of the Act, means a person who has acquired citizenship
in terms of Chapter 2 of the South African Citizenship Act 88 of 1995.
Another determining factor for a person’s eligibility for social assistance is his or
her financial position (means) because the grants are awarded only if the applicant’s,
or in the case of a foster-child grant, the foster child’s financial resources are below
a certain level. Therefore, a means test is used to determine if a person qualifies to
receive a grant or not. The Social Assistance Act and the Regulations published in
terms of the Act set out conditions for the payment of various social grants. When
applying for the grant, the applicant must indicate how he or she would like to
receive the money. The grant can be received either in cash on specific days at a
pay point, or electronically into the applicant’s bank account. It takes about three
months for the application to be processed and for grant payments to start.
Payments are backdated to the day that the application was made. Applicants are
SSL2601/1 35
allowed to make enquiries about their applications and about when they can expect
payment of the grant by phoning (through a toll-free facility) the South African
Social Security Agency.
Different social assistance grants are discussed in detail below.
3.2.2 Child grants
3.2.2.1 Introduction
Section 28 of the Constitution gives every child the right to family, parental or alternative
care, shelter, basic health care services, and basic nutrition. In order to give effect to the
rights entrenched in section 28 of the Constitution of the Republic of South Africa, various
Acts provide for grants and benefits to parents and caregivers to support children in their
care.
The most important principle captured in section 28(2) is that the “best interests”
of the child are of paramount importance in every matter concerning the child. On
the other hand, section 27(1)(c) of the Constitution provides that everyone has the
right to have access to social security including, if they are unable to support
themselves and their dependants, appropriate social assistance. Furthermore,
section 27 (2) obliges the state to take reasonable legislative and other measures,
within its available resources, to achieve the progressive realisation of the right to
have access to social security (this provision is analysed in Learning unit 2 above).
Section 27 (2) provides that, in addition to legislative measures, financial,
administrative, judicial, economic, social and educational measures must be taken.
It is very important to take note that, unlike section 27 which has an
“internal limitation” in subsection (2), section 28 has no limitation.
Therefore, the Constitution imposes a duty on the state to allocate resources so
that children’s socio-economic rights can be realised immediately and not
progressively. The allocation of scarce resources to poor children should be
prioritised over allocations to all other categories of poor people. Children’s socio-
economic rights are intended to afford children a certain basic subsistence level
of the same social and economic goods that are provided for in a more advanced
form in sections 26 and 27 of the Constitution. For example, section 26 (1) gives
everyone the right of access to adequate housing, whereas section 28 (1) (c) gives
children the right to shelter. Children’s right to basic nutrition, shelter, basic health
care services and social services are material elements of their right to family,
parental or appropriate alternative care. Children are the most vulnerable group in
society. It was therefore made possible that their welfare rights be easily enforceable.
ACTIVITY 3.3
Explain how the Constitution prioritises children’s socio-economic rights over those of
other citizens.
A good example would be sections 26 and 27 of the Constitution which both have inter-
nal limitations and section 28 (which provides for children’s rights) which does not have
any internal limitation.
36
3.2.2.2 Child support grant

3.2.2.2.1 General
The child support grant is paid to provide for the basic needs of children up to the
age of 18 years whose parents or primary caregivers are not able to provide
sufficient support for them because of factors such as unemployment or
poverty.
A primary caregiver is any person who takes primary responsibility for the daily needs of a
child and who may not be related to the child.
The amount of the grant increases regularly. It is immaterial whether the person
receiving the grant is the parent of the child or not, or whether the parents of the
child are living together, whether they are married, whether either of the parents is
in prison, or whether the husband or wife receives another state grant. Payments
stop if the caregiver dies, if the child dies, when the child is above the qualifying age,
if someone else starts looking after the child, or if the caregiver’s circumstances
change and he or she no longer qualifies to receive the grant. Payments of the grant
are monitored from time to time to check if the applicant still qualifies to receive
the grant.
3.2.2.2.2 Eligibility of the grant

A primary caregiver (who must be 16 years of age) can apply for the child support
grant on behalf of a child or children in his or her care. The grant is paid to a
primary caregiver but follows the child. For example, if a new caregiver takes the
place of the original caregiver, the grant will be accessed by the new caregiver. The
primary caregiver is responsible for ensuring that the child is fed, clothed,
immunised, and given access to health care. The child’s eligibility to receive the
grant will depend on the financial situation of the primary caregiver and his or
her spouse. If the primary caregiver is a single parent, he or she should first try to
get money from the child’s other parent by applying for a maintenance order.
The following factors are important to determine whether the primary caregiver (or
child) should get the grant or not:
● personal income of the primary caregiver or spouse

● where the child lives (rural or urban area)
● the type of dwelling that the child lives in: informal (shack/hut) or formal
(brick/concrete/asbestos walls)
The person who applies must:
● be the primary caregiver of the child

● be over the age of 16 years
● be living with the child in South Africa at the time of the application for the
grant
● pass the means test
● be either a South African citizen or a permanent resident or a refugee
SSL2601/1 37
A primary caregiver cannot receive the grant if:
● he or she is being paid to look after the child

● someone else already gets a grant for the child
● the child concerned does not have a valid birth certificate
● the child is resident in an institution funded by the state
The following documents are required for the application:
● the primary caregiver’s South African identity document

● the child’s identity document or birth certificate
● proof that the child has been immunised
● proof of any maintenance received from a parent of the child, or proof of ef-
forts to obtain maintenance from a parent
● proof of earnings and assets (what the applicant owns), and proof of a regular
income of the household in which he or she lives
● if the applicant is married, a marriage certificate
● if the applicant is divorced, the court order giving details of custody of the
child
● if the primary caregiver is not the parent of the child, a letter or affidavit from
the parent of the child giving the person permission to take care of the child
● a death certificate if one or both parents are deceased, or – if the father or
mother is missing – proof of this (such as a missing person’s report from the
police and sworn statements from the applicant and another family member)
All copies of the documents must be certified – meaning they must be signed and
stamped by a police officer or any other commissioner of oaths. The applicant will
be given a copy of the application or a dated receipt signed by the SASSA officer.
This provides proof of the application. If the application is refused, the applicant
will receive a letter explaining why it has been refused and how he or she can
appeal the decision.
3.2.2.3 Care dependency grant

The care dependency grant is for children up to the age of 18 years who have
severe disabilities and who require and receive permanent home care. The grant is
means-tested. It is payable to parents, foster parents, custodians or guardians
providing permanent home care to an unlimited number of children. The amount
of the grant increases regularly in line with inflation. An assessment must be made
to confirm that the child indeed requires and receives permanent care or support
services due to his or her physical or mental disability. The applicant must pass the
means test and must be a South African citizen or a permanent resident or a
refugee.
The documents required in order to apply for the grant are the following:
● identity document or birth certificate in respect of the child

● identity document of the parent or foster parent
● medical forms (from a state medical officer or assessment board)
38
● proof of income and assets, or an affidavit confirming unemployment of the

parent or foster parent
● application forms from a welfare office (SASSA)
A person is not eligible for the grant if the child is cared for on a 24-hour basis for
a period exceeding six months in an institution that is funded by the state.
3.2.2.4 The foster-child grant

The foster-child grant is meant for children under the age of 18 years who have
been placed in foster homes by the courts. It is payable to the foster parent for an
unlimited number of children. Only the means of the child are considered and not
those of the foster parents. The foster child’s income must not exceed twice the
annual amount of the grant. As with other grants, the amount increases regularly in
line with inflation.
The foster parent will qualify for the grant if:
● he or she is a South African citizen, a permanent resident, or a refugee

● he or she resides in the Republic
● if it is a cluster foster-care scheme, the scheme must be registered by the Head
of the Provincial Department of Social Development
● the child is placed and remains in the care of the foster parent or cluster care
scheme in terms of the Children’s Act
● the child is not admitted to an institution funded by the state
He or she may not qualify for a foster-child grant:
for more than six children, except where the children are siblings or blood rela-
tions, or the court considers this for any reason to be in the best interest of all
the children involved.
The documents required to apply for the grant are the following:
● an identity document or birth certificate in respect of the child (these docu-

ments do not need to be South African)
● an identity document of the foster parent
● the relevant court order
● proof of income, if any, of the child (no means test is required for the foster
parent)
● application forms from a welfare office (SASSA)
● proof of child’s school attendance, if applicable
ACTIVITY 3.4
Name and describe the grants available to children in South Africa.
SSL2601/1 39
They are the child support grant, care dependency grant and foster-child grant. Do you
remember what they all entail? If not, please go back to the discussion of the child
grants above.
3.2.2.5 Old-age grant

The old-age grant is meant for the elderly, both men and women, from the age of
60 years. The pension is also means-tested. It is one of the two largest social
security transfers in South Africa together with the child support grant. It is
intended to support the elderly who meet the eligibility requirements. The grant
very often goes towards supporting unemployed adult children and other
household members, sustaining missing-generation households due to AIDS
mortality, and paying for grandchildren’s schooling. The grant plays a pivotal role in
poverty alleviation for those who receive it as it brings substantial volumes of cash
into poor households and communities.
The applicant must:
● pass the means test

● be a South Africa citizen or a permanent resident
● have a valid identity document
● not be a beneficiary of another grant
● not be maintained in any one of the following state institutions or institutions
funded by the state – a prison, a state psychiatric hospital, a state home for
older persons, a care treatment centre or a treatment centre for drug
dependants
3.2.2.6 Disability grant

The disability grant is paid to disabled people who have attained the age of 18
years and older and who, owing to a physical or mental disability, are unfit to
obtain, by virtue of any service, employment or profession, the means needed to
enable them to provide for their own maintenance.
The qualifying requirements include the following:
● The person must be a South African citizen, a permanent resident or a

refugee.
● The disability must be confirmed by an assessment which indicates whether
the disability is permanent (if it will continue for more than 12 months) or
temporary (if it will continue for a continuous period of not less than 6
months or for a continuous period of not more than 12 months as the case
may be).
Provided that the assessment is, at the date of application, not older than three
months:
● the person is not able to enter the open labour market or to support himself
or herself in light of his or her skills and ability to work
40
● the person does not unreasonably refuse to accept employment which is with-
in his or her capabilities and from which he or she can generate income to
provide fully or partially for his or her own maintenance
● the person does not, without good reason, refuse to undergo the necessary
medical or other treatment recommended by a medical officer
3.2.2.7 Grant-in-aid
A person is eligible for a grant-in-aid if he or she is in such a physical or mental
condition that he or she requires regular attendance by another person,
subject to the following qualifying requirements:
● The person must be a South African citizen, permanent resident or a refugee.

● He or she is in receipt of an older person’s grant, disability grant or a war vet-
eran’s grant
● The person is certified by a medical officer or medical practitioner as requir-
ing regular attendance by another person.
3.2.2.8 War veteran’s grant

A person is eligible for a war veteran’s grant if he or she is, owing to a physical or
mental disability, unable to provide for his or her maintenance, and
● has performed any naval, military or air force service during the Great War of
1914–1918 as a member of any Union or British Force, or was a member of
the protesting burgher forces during the period September 1914 to February
1915
● has performed any naval, military or air force service during the war which
commenced on 6 September 1939 as a member of the Union Defence Forces
or, in the case of a Union national, as a member of any British or dominion
force or any force of a government which was allied to the Government of
the Union during that war
● while he or she was not a Union national, performed any naval, military or air
force service during the Great War of 1914–1918; was involved in the war that
commenced on 6 September 1939; or signed an undertaking to serve in con-
nection with the hostilities in Korea.
The person must have attained the age of 60 years and must be a South African
citizen.
3.2.3 Administration of social grants in South Africa
The South African Social Security Agency (SASSA) is responsible for the administration
and payment of social grants in this country.
The Agency was established in April 2005 to root out fraud and improve
efficiency in the administration of social grants. It is aimed at speeding up
delivery of social grants, cutting down on corruption in the system, and taking
SSL2601/1 41
up the responsibility of administering grant applications and payments from

the country’s nine provinces.
The grant administration under SASSA is streamlined, and the application process
involves fewer people and fewer steps. A person in need of social assistance should
apply in the prescribed manner and present himself or herself at the Agency’s
office or any designated place in the area in which he or she resides.
The Agency must, on approval of a grant application, inform the applicant in
writing in the language of preference of the applicant of such approval and the date
on which approval was granted. The Agency must, upon refusal of the grant
application and within a reasonable time thereafter, inform the applicant of such
refusal. If approved, a grant is payable from the date on which the application was
deemed to have been made.
The grant is paid by the Agency by electronic transfer into an account of the
beneficiary or institution where the beneficiary resides, subject to written
authorisation by the beneficiary or through manual payments at a designated place.
The Agency has the power to suspend payment of the grant if the beneficiary fails
to submit information or documentation to proof that his or her medical condition
has not changed, or a life certificate to prove that he or she is still alive. In such a
case, the beneficiary will have to apply for restoration of the grant. The Agency
may also suspend or cancel payment of a grant under certain circumstances. A
grant, once granted, confers upon the beneficiary the right to receive that grant
until it is lawfully terminated. The grant cannot be lawfully terminated without
observing the rules of natural justice and asserting the right to fair administrative
action, including the right to be heard.
An applicant or beneficiary of social assistance who is aggrieved by a decision of
the Agency shall, within 90 days of gaining knowledge of such a decision, lodge an
appeal in writing to the Minister of Social Development setting out the grounds on
which the appeal is based, and submit a copy thereof to the Agency. The Minister
may appoint a person or persons to constitute a tribunal to consider an appeal. The
tribunal must dispose of the appeal within 30 days unless the Minister directs
otherwise. The Minister must communicate the outcome of the appeal in writing
and in the official language of preference of the beneficiary within 10 days of the
decision of the tribunal. The courts of law also have the power to enforce
constitutional rights as well as constitutional obligations imposed on the state.
The Agency may suspend payment of any of the child grants if the parent, primary
caregiver, foster parent or procurator is convicted of abuse or neglect of the child
in respect of whom he or she receives a grant, or is found to be incapable of using
a grant for the benefit of the child. The Social Assistance Act prohibits the cession,
transfer or pledge of a grant. If a beneficiary attempts to do either of the
prohibited acts with the grant, such grant may be withheld, suspended or stopped.
A grant may also not be liable to attachment or any form of execution under a
judgment or order of a court.
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ACTIVITY 3.5
Explain what the South African Social Security Agency is and what its functions are.
This is the Agency which was established to handle the administration and payment of
social grants in this country. Its objectives include improving efficiency in the administra-
tion of social grants, speeding up the delivery of social grants, and reducing corruption
in the system. Study paragraph 3.2.3 to remind yourself about other functions of the
Agency.
3.3 SOCIAL RELIEF

Social relief in this regard covers social relief of distress granted to an individual or
a community.
Distress, in this context, refers to a condition that is usually precipitated by a crisis situa-
tion such as a sudden change in status resulting from death, the loss of a job, illness or
an accident.
Social relief entails the giving of temporary material assistance to people and their fami-
lies when they are unable to meet their most basic needs during a crisis.
Social relief of distress is given monthly for a period of three consecutive

months and may not exceed the maximum social grant payable to the person per
month. Extension of the period by a further three months may be granted in
exceptional cases. Social relief is defined in the Fund-Raising Act 107 of 1998 as
“the alleviation of need of persons (or communities) by means of the temporary
rendering of material assistance to them”. It entails short-term measures
undertaken by the state and other private organisations to assist persons during
individual or community crises that have caused the affected persons or
communities to be unable to meet their most basic needs. Social relief programmes
are aimed at the alleviation of both chronic and transient poverty.
Transport expenditure may be paid in exceptional cases such as where:
● the applicant is referred for treatment by a medical officer and no other trans-
port arrangements can be made
● the applicant must travel to a specific destination to accept employment where
he or she will not be dependent of further state aid
A person will qualify for social relief of distress if he or she does not receive
assistance from any other organisation and satisfies one or more of the following
conditions:
● He or she has insufficient means.
● He or she is a South African citizen or a permanent resident or a refugee and
resides in the Republic.
● He or she is awaiting payment of an approved social grant.
SSL2601/1 43
● He or she is a breadwinner and has been assessed to be disabled for a period

of less than six months.
● The breadwinner of the household has died, and an application is made within
12 months following his or her death.
● The breadwinner of the household has been admitted to a public or private
institution for at least one month.
● If the refusal of the application may cause hardship.
A person cannot receive a social grant in respect of himself or herself and social
relief of distress at the same time. Social relief is regulated by the Social Assistance
Act of 2004 and is financed through tax revenue.
ACTIVITY 3.6
Read the following scenario and answer the question that follows. The community of
Tsotsobeng has been affected by floods as a result of heavy rains experienced over the
period of a week. Most families have been displaced due to floods. People have
nothing to eat and it is impossible to visit shops because roads have been destroyed. Is
there any way in which government can assist this community? Discuss fully.
The people of Tsotsobeng will qualify for assistance in the form of social relief of dis-
tress. This form of assistance involves the giving of temporary material assistance to
people and their families when they are unable to meet their most basic needs during a
crisis such as a flood. Assistance in this regard entails short-term measures undertaken
by the state (and/or other private organisations) to assist persons during individual or
community crises that have caused the affected persons or communities to be unable
to meet their most basic needs.
In terms of section 16 of the Fund-Raising Act of 1978, various funds have been
established to provide persons and communities with assistance:
● Disaster Relief Fund

The object of the board of the Disaster Relief Fund is to render to persons,
organisations and bodies who or which suffer damage or loss caused by a
disaster, such assistance as the board may deem fair and reasonable.
● South African Defence Force Fund
The object of the board of the South African Defence Force Fund is to
render such aid as the board may deem fair and reasonable to members and
former members of the South African Defence Force and of auxiliary
services established and designated in accordance with section 80 (1) of the
Defence Act of 1957, and their dependants who suffer financial hardship or
financial distress arising, directly or indirectly, out of any service or duties
contemplated in section 3 (2) of the Defence Act, performed by such
members, and to provide facilities to or for such members and former
members who perform or performed such service or duties.
44
● Refugee Relief Fund

The object of the board of the Refugee Fund is to render such assistance to
refugees as the board may deem fair and reasonable.
● State President’s Fund
The object of the board of the State President’s is to render such assistance as
the board may deem fair and reasonable to:
(i) the victims of any act of terrorism in respect of their medical treatment
and rehabilitation
(ii) such victims and their dependants who suffer financial hardship or fi-
nancial distress caused directly or indirectly by any act of terrorism
● Social Relief Fund
The object of the board of the Social Relief Fund is to make money from the
Fund available to organisations that, in the opinion of the board, are capable
or rendering assistance to persons with psychosocial problems and of
rendering such social relief of distress as the board may deem fair and
reasonable to members of communities that, in the opinion of the board, are
victims of violence.
Social relief in instances of community crises is available to all members of society,

irrespective of their financial position. Activities undertaken in terms of the Fund-
Raising Act are managed by a board established by the Minister of Social
Development.
3.4 HARDSHIP CAUSED BY THE STATE

There are measures in place to compensate individuals upon whom the state or its
predecessor has inflicted harm or damage. The Special Pensions Act 69 of 1996 (as
amended) was enacted to give effect to section 189 of the Interim Constitution,
which stated that provisions shall be made by an Act of Parliament for the payment
of special pensions by the national government to persons (or their dependants)
who made sacrifices or who have served the public interest in the establishment of
a democratic constitutional order.
The Special Pensions Act 69 of 1996 provides for special pensions to be paid to persons
who have made sacrifices, suffered financial deprivation or served in the public interest
during the liberation struggle, in the course of establishing a non-racial democratic consti-
tutional order in South Africa while serving full-time in a banned or restricted political or-
ganisation and, as a consequence of such activity, were unable to or prevented from
providing for pensions, for a significant period.
Section 189 of the interim Constitution envisaged a non-contributory pension

scheme in which members would not be required to contribute to the monetary
cost of their pensions, but rather through service and sacrifice for the
establishment of the constitutional order.
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The purpose of the Special Pensions Act is to compensate those who were involved in
the liberation struggle and who, on that account, lost the opportunity to provide for a pen-
sion. It also seeks to compensate the surviving spouses and dependants of such
persons.
The requirement, in terms of the Act, that a person must have been at least 30
years or older on 1 December 1996 is to ensure that only those who would not
have been in a position to make provision for their old age would qualify for
a special pension. If a person was younger than thirty years on this date, the
assumption is that, despite a person’s contribution to the liberation struggle, he or
she was young enough to still make provision for retirement. In terms of section
60A of the Special Pension Amendment Act 13 of 2008, a person who made
sacrifices or served the public interest in establishing a non-racial, democratic and
constitutional order and who is a citizen, or entitled to be a citizen of the Republic
of South Africa, has the right to a pension in terms of this Act if that person –
(a) was at least 30 years of age, but had not attained 35 years of age on the com-
mencement date; and
(b) was prevented from providing for a pension for a total or combined period
of at least five years prior to 2 February 1990
In terms of section 6F of the Special Pension Amendment Act of 2008 (1), a
funeral benefit, as set out in Schedule 4, is payable to –
(a) a pensioner on the death of his or her spouse or child;
(b) a surviving spouse upon the death of a pensioner or child of a deceased pen-
sioner, or
(c) any dependant who becomes an orphan upon the death of a pensioner or
surviving spouse a deceased pensioner, or of
(d) any dependant who becomes an orphan upon the death of a surviving spouse
of a deceased person referred to in section 6D(3).
The definition of “dependant” in the Act creates three categories of dependants,
namely legal dependants, factual dependants and future dependants.
A person is regarded as a dependant (s 1(1)(a)) if the deceased was legally liable to main-
tain that person. Dependants in respect of whom the member is legally liable for mainte-
nance include a spouse and children who rely on the member for the necessities of life.
Section 1 (1) (b) deals with persons who were not legally dependent on the
deceased member for maintenance. It then outlines categories of such dependants.
Where there is no duty of support, a person might still be a dependant if the
deceased contributed to the maintenance of that person in some way. The person
claiming to be a factual dependant will have to prove that he was dependant on
the deceased (despite the latter’s not having a legal duty of maintenance) when the
member died. In terms of the definition of the dependant, any person in respect of
whom the deceased would have become legally liable for maintenance (in future),
had he or she not died, is regarded as a dependant. This section pulls into the
ambit of a “dependant” a person whom the deceased was not legally liable to
maintain, but who would have qualified as a legal dependant had the deceased not
died. For example, where an applicant is the mother of a deceased person and was
not dependant on the deceased for maintenance at the time of his or her death, and
if the applicant can show that subsequent to the date of death, she required
46
financial, medical and other forms of support and that the deceased, had he lived,
would have become legally liable to maintain her in terms of the legal duty arising
out of the child-parent relationship, then she would qualify as a future dependant.
(3.1) Name social grants paid in terms of the Social Assistance Act of 2004.
(3.2) Explain what a “means test” entails.
(3.3) What are the requirements that must be met to qualify for a child support grant?
(3.4) Who can apply for a child support grant?
(3.5) What is the role of a primary caregiver?
(3.6) Describe the nature of assistance given to people who experience hardship due to
harm inflicted on them by the state.
(3.7) Describe a foster-child grant.
(3.8) What are the functions of the South African Social Security Agency?
(3.9) Describe social relief of distress.
(3.10) Name and describe the funds which have been created to provide persons and
communities with social relief of distress and describe their individual objectives.
3.5 CONCLUSION
Social grants play a very important role in the reduction of poverty in South Africa.
They cover part of the costs of supporting families and of raising children.
However, in order to target those who need assistance, a means test has to be
applied. Social relief of distress is also available as a temporary measure afforded to
individuals and communities which have been stricken by crises. This is just a
short-term measure undertaken by the state to assist those affected and who are
unable to meet their most basic needs. It is not means-tested if a community is
affected. The state also gives assistance to people who experience hardship due to
harm inflicted on them by the state.
Now that you have concluded this learning unit, you should be able to understand what
social assistance entails, name the types of social assistance that are available in South
Africa, and distinguish various forms of social assistance and their eligibility requirements.
The next learning unit looks at another form of formal social security, namely
social insurance.
3.6 GLOSSARY
Security The state of being free from a threat or harm.
Assistance The action of helping someone by sharing resources.
Grant State-aided financial support provided to poor members of
society.
Basic needs The things that are necessary to sustain life. For example, food,
water, shelter, clothing, education, healthcare, and sanitation.
Means Financial resources; income.
Depend Requiring someone or something for financial or other support.
Primary A person who has the greatest responsibility for the daily care
caregiver of a child.
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Foster To bring up (a child that is not one’s own by birth).

Beneficiary A person who derives advantage from something, for example,
a social assistance programme or insurance fund.
Factual A person who was, in fact, dependent on the member (of a fund,
dependant for example) for maintenance at the date of the member’s death.
Legal Someone who is legally (legal duty to maintain) maintained/sup-
dependant ported by another person.
Distress To experience suffering, discomfort or pain.
Relief To release someone from anxiety or distress.
Alleviate To make (suffering, a problem) less severe.
Veteran A person who has had long experience in a particular field.
ACTIVITY 3.7
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● describe social assistance
● describe different social grants
● identify the eligibility requirements for each social grant
● explain how a person can apply for a social grant
● define the concept of social relief of distress
● describe the functions of the Social Security Agency (SASSA)
● advise a person upon whom the state has inflicted harm about compensation to
which he or she may be entitled
48
Learning unit 4
Social insurance
Learningunit4
Contents
4.1 INTRODUCTION 50
4.2 UNEMPLOYMENT PROTECTION 51
4.2.1 General 51
4.2.2 Unemployment benefits resulting from loss of employment 53
4.2.3 Maternity protection 54
4.2.3.1 Protection by the Unemployment Insurance Act 63 of 2001 54
4.2.3.2 Protection by the Basic Conditions of Employment Act 75 of
1997 (BCEA) 55
4.2.4 Illness benefits 56
4.2.4.1 Protection and benefits paid in terms of the Unemployment
Insurance Act of 2001 56
4.2.4.2 Protection and benefits paid in terms of the Basic Conditions of
Employment Act of 1997 and the Labour Relations Act of
1995 56
4.2.5 Adoption benefits 59
4.2.6 Dependant’s benefits 59
4.2.7 The Unemployment Insurance Contributions Act of 2002 (UICA) 59
4.3 OLD-AGE AND RETIREMENT PROVISION 59
4.3.1 General 59
4.3.2 Occupation retirement schemes 60
4.3.3 Death Benefits: Section 37C of the Pension Funds Act 61
4.3.4 Administration and adjudication 63
4.4 INVALIDITY/DISABILITY PROTECTION 65
4.4.1 General 65
4.5 PROTECTION AGAINST MOTOR VEHICLE ACCIDENTS 65
4.6 CONCLUSION 66
4.7 GLOSSARY 66
SSL2601/1 49
LEARNING UNIT 4: SOCIAL INSURANCE
In this learning unit, we discuss social insurance, which is the second component of
formal social security, as well as various social insurance schemes that are available
in South Africa. We also discuss different risks against which members of various
social insurance schemes are protected. The risks and/or contingencies include
unemployment, maternity, sickness, invalidity, disability, old age or retirement, and
road accidents.

● define social insurance
● identify various social insurance schemes
● describe unemployment benefits available in South Africa
● describe protection available to a female worker who is pregnant
● describe retirement schemes available to persons in their old age
● explain how the death benefits of a deceased member of a retirement scheme are
distributed
● explain protection given to employees who are sick
● explain protection given to the invalid or the disabled
● discuss the rights and entitlements of sick and disabled employees
● explain protection given to those involved in road accidents
● understand how social insurance schemes are financed and administered
4.1 INTRODUCTION
Social insurance is a form of insurance. It is designed to protect income-earners
and their families against a reduction in or loss of income as a result of
exposure to risks. It is funded by contributions made to a fund by employers,
employees, self-employed persons and sometimes also by the state. Social insurance
is aimed at achieving a reasonable level of income maintenance. It is based on
insurance principles and is mostly obligatory for persons who are eligible to join
with the aim of achieving social solidarity.
Thus, social insurance has the following characteristics:
● The payment (or an undertaking to pay premiums) of a contribution/premi-

um by the insured to the insurer
● An undertaking by the insurer to compensate the insured should the risks he
or she is insured against occur
– Protection is against the occurrence of a specified uncertain event
– that causes loss or harm, or which is averse to the interest of the insured
Contributions are generally paid in advance, that is, prior to the occurrence of the
event against which cover has been taken out. Employees or employers or both pay
regular contributions to social insurance schemes. In some cases, the state assists
in the financing of the schemes. The contributions usually constitute a percentage
of an employee’s earnings. The event against which cover is taken out must be
specified, but there must be uncertainty as to when it will happen. The insured
must have an interest in the preservation of what is being insured. It is regulated by
the state through legislation. Compensation is normally in the form of a cash
50
payment. Thus, in return for contributions made, members of social insurance

schemes and/or their dependants are entitled to benefits upon the occurrence of
the risk against which a person is insured. In general, social insurance is not
available to everyone and is restricted to employees in formal employment and
their dependants in certain circumstances.
Social insurance schemes such as the unemployment insurance fund, retirement
schemes and the compensation for occupational injuries and diseases scheme, play
a pivotal role in the alleviation of poverty through the survivors’ benefits they
provide on the death of a breadwinner.
According to the International Labour Organisation (ILO), the following are the
principal elements of social insurance:
● It is financed by contributions which are normally shared among employers,

employees and sometimes the state (mostly by means of supplementary con-
tributions or other subsidies from general revenue).
● Such schemes provide for the payment of benefits and the rendering of serv-
ices whenever the social risk against which the beneficiaries insure themselves
occurs.
● Participation is normally compulsory.
● Contributions are accumulated in special funds from which benefits are paid.
● Surplus funds are invested to earn further income. A person’s right to a bene-
fit is secured by his or her contribution record without any needs or means
test.
● Contribution and benefit rates are often related to what a person is or has
been earning.
Social insurance provide protection against ill health, unemployment, old age, the death
of a breadwinner, employment injuries and diseases, road accidents, pregnancy and inva-
lidity or disability.
These risks or contingencies are discussed below except protection against

employment injuries and diseases, which is discussed in Learning unit 5 below.
4.2 UNEMPLOYMENT PROTECTION

4.2.1 General
Unemployment is one of the serious risks that can happen to a person. As a result,
the legislature has introduced legislation that seeks to relieve the hardships which
befall unemployed workers. Two pieces of legislation govern unemployment
insurance, namely the Unemployment Insurance Act 63 of 2001 (UIA) and
Unemployment Insurance Contributions Act 4 of 2002 (UICA). The fund called
the Unemployment Insurance Fund (UIF) is used to pay unemployment benefits to
certain employees and other benefits such as illness, maternity, adoption and
dependant benefits. It is compulsory for employers and employees to pay
contributions to the Fund.
A contributor (contributor: a natural person who is or was employed, to whom
section 3 of the UIA applies, and who can satisfy the Unemployment Insurance
SSL2601/1 51
Commissioner that he or she has made contributions for purposes of this Act) is
entitled to one day’s benefit for every completed six days of employment as a
contributor, subject to a maximum accrual of a 238-days benefit in the four-year
period immediately preceding the date of application for benefits. A benefit can
be claimed by only a contributor or a dependant of a contributor.
In terms of the Act, a contributor is a natural person:
● who is or was employed

● to whom the UIA applies
● who can satisfy the Commissioner that he or she has made contributions for
purposes of the UIA
The Act defines an employee as any natural person who receives remuneration or to
whom remuneration accrues in respect of services rendered or to be rendered by that
person.
However, the term excludes any independent contractor.

The following categories of persons are also excluded from the ambit of both the
UIA and UICA:
● persons who do not fall within the definition of employee
● employees who are not contributors as defined
● employees who receive remuneration under a learnership agreement
● employees in the national spheres of government
● persons who enter the Republic for the purpose of carrying out a contract of
service, apprenticeship or
● learnership if there is a legal or a contractual requirement or any other agree-
ment or undertaking that such person must leave the Republic, or that such
person must be repatriated upon termination of the contract
● employees employed for less than 24 hours a month by a particular employer
● employees in the national and provincial spheres of government
● persons who enter the Republic for purposes of carrying out a contract of
service, apprenticeship or
● learnership within the Republic if, upon the termination thereof, the employer
is required by law or by the contract of service, apprenticeship or learnership,
as the case may be, or by any other agreement or undertaking, to repatriate
that person, or that person is so required to leave the republic, and the employ
of their employers
● employees who receive remuneration under a learnership agreement in terms
of the Skills Development Act 97 of 1998
It is important to note that, as from 1 April 2003, domestic workers have also been
included under the Act.
52
An employer means any person who pays or is liable to pay to any person any amount by
way of remuneration and any person responsible for the payment of any amount by way
of remuneration to any person under the provisions of any law or out of public funds, ex-
cluding any person who does not act as a principal.
A contributor will not be entitled to benefits for any period that he or she was in
receipt of:
● a monthly pension from the state

● any benefit from the Compensation Fund as a result of an occupational injury
or disease, which caused the total or temporary unemployment of that
contributor
● benefits from any bargaining or statutory council unemployment fund or
scheme established in terms of the LRA
● illness benefits – however, such contributor will be entitled to unemployment
benefits if he or she becomes ill while receiving unemployment benefits if the
claims officer is satisfied that the illness is not likely to prejudice the contribu-
tor’s chances of securing employment
This is to prevent persons from claiming benefits from more than one public fund.
However, the Act does not prohibit double-dipping in respect of other public
funds such as the Road Accident Fund.
Entitlement to benefits is also forfeited for any period that the contributor:
● fails to comply with any provision of the UIA or any other law relating to
unemployment
● is suspended (for a period of up to five years) from receiving benefits under
fraudulent circumstances
A dependant of a contributor is entitled for various benefits under the UIA. A

“dependant” is defined as:
● the surviving spouse or a life partner of a deceased contributor; and

● any dependent child of a deceased contributor if (a) there is no surviving
spouse or life partner or (b) the surviving spouse or life partner has not made
application for the benefits within six months of the contributor’s death
The main question in determining who qualifies as a dependant should be whether

a person was or would have been wholly or mainly financially dependent on the
deceased.
4.2.2 Unemployment benefits resulting from loss of employment

A person is entitled to unemployment benefits from the date of unemployment:
● for any period of unemployment lasting more than 14 days

● provided he or she has contributed to the Fund
SSL2601/1 53
● The person must have lost employment due to:

– the termination of a contract (of employment) by the employer
– having been dismissed and the dismissal qualifies as such in terms of sec-
tion 186 of the Labour Relations Act 66 of 1995
– the coming to an end of the contributor’s fixed-term contract of
employment
– insolvency in terms of the Insolvency Act 24 of 1936
● The contributor must apply for benefits in accordance with the provisions of
the UIA
● The applicant must register as a work seeker with a labour centre that was es-
tablished under the Skills Development Act
● He or she must be capable of and be available for work
In terms of the ILO Convention 168: Employment Promotion and Protection

against Unemployment Convention of 1988, unemployment benefits may be
refused, withdrawn, suspended or reduced if it has been determined by a
competent authority that:
● the person concerned has left the employment voluntarily without just cause
(for example, persons who resigned, deserted, or retired)
● the person concerned had deliberately contributed to his or her own dismissal
such as in case of misconduct
4.2.3 Maternity protection

4.2.3.1 Protection by the Unemployment Insurance Act 63 of 2001
The UIA makes provision for maternity leave. In South Africa, the scope of
protection for maternity is usually restricted to female workers in social insurance
schemes who are, or have been, formally employed. Job applicants who are
already pregnant are also covered to a limited extent. When a female worker
becomes pregnant, many issues arise. These include the effect of pregnancy on her
job, her absence from work before and after childbirth, and maternity benefits
available to her. Because most women spend their childbearing years in paid
employment, there is a need for adequate maternity protection. Maternity benefits
and protection are regulated by the following legislation:
● Unemployment Insurance Act 63 of 2001 (UIA)

● Labour Relations Act 66 of 1995 (LRA)
● Basic Conditions of Employment Act 75 of 1997 (BCEA)
● Employment Equity Act 55 of 1998 (EEA)
A female pregnant contributor is entitled to maternity leave for a maximum

period of 17 or 32 weeks or four months. Note should be taken that an employee
who receives maternity benefits in terms of a collective agreement or any other law
cannot claim maternity benefits from the UIF, and also that what she receives
must not be more than her monthly salary. It must be remembered that even
though most employees are entitled to maternity leave, there is no statutory duty
on employers to provide paid maternity leave.
54
Only the mother of a child is entitled to claim maternity benefits. Any person who
adopts a child is entitled to claim adoption benefits provided that he or she was a
contributor to the Unemployment Insurance Fund. The total amount that an
employee receives from the UIA and from sources other than the UIF, for example,
her employer, may not exceed her normal monthly salary. She will receive a
benefit from the UIF only if she receives less than her normal monthly salary from
the employer or any other source.
ACTIVITY 4.1
Read the following scenario and answer the questions that follow. Shibu works at
Efficient Suppliers as a clerk. She currently works shifts of only five hours a day during
weekends. Shibu is pregnant and, before she goes on maternity leave, she is informed
that a decision was taken by management to terminate the employment contracts of ten
cashiers, hers included. This is said to be the result of a restructuring process that is
taking place within Efficient Suppliers. Shibu is afraid that if she claims maternity
benefits in terms of the UIA, she will not be able to claim unemployment benefits when
her employment is terminated. Advise Shibu.
The UIA covers all employees who work more than twenty-four hours a month. There-
fore, Shibu qualifies in terms of the UIA. The fact that Shibu had at one stage made a
claim for maternity benefits from the UIA does not mean that she will lose her entitle-
ment to claim any other category of UIA benefits.
4.2.3.2 Protection by the Basic Conditions of Employment Act 75 of 1997 (BCEA)

Section 25 of the BCEA provides that an employee is entitled to at least four
consecutive months’ maternity leave. Employers are not, in general, obliged
to pay workers a salary during their maternity leave. However, individual
agreements between employers and employees may allow for all or part of the leave
to be paid.
An employee may commence with her maternity leave at any time from four
weeks before the expected date of birth, unless otherwise agreed, or on a date
from which a medical practitioner or a midwife certifies that it is necessary for
the health of the employee or that of her unborn child.
The payment of maternity benefits is to be determined by the Minister of Labour
subject to the provisions of the UIA. An employee who is a parent, is entitled to at
least ten (10) days parental leave. The leave may commence on the day the
employee’s child is born; or the date that the adoption order is granted; or the date
that the child is placed in the care of a prospective adoptive parent by a competent
court, pending the finalisation of an adoption order in respect of the child.
An application for maternity benefits must be made on the prescribed form at
least eight weeks before childbirth. The Commissioner can condone or accept an
application referred less than eight weeks provided that the applicant submits good
reasons for the late referral. The Commissioner may extend the period of
submission of the application for a period of up to six months after the date of
birth.
SSL2601/1 55
ACTIVITY 4.2
Read the following scenario and answer the question. Naledi works as an
administrative officer. She tells her manager that she is pregnant and will need
maternity leave. The manager refers Naledi to a collective agreement concluded
between the company and the trade union which states that female workers are entitled
to at least one month’s maternity leave with full salary. Naledi is not sure if her rights are
being infringed or not and comes to you for advice. Advise Naledi about this issue.
In terms of section 25 of the BCEA, an employee is entitled to at least four consecutive

months’ maternity leave. However, employers and recognised trade unions or individual
employees may conclude agreements among themselves that regulate the terms and
conditions of employment.
It must be noted that these agreements may not reduce the core rights provided
for in the BCEA. Therefore, in Lebo’s case, in addition to the one month paid
leave referred to in the agreement with the trade union, the employer must grant
her three months’ unpaid leave. Always remember that collective agreements must
be consistent with the purpose of the BCEA.
4.2.4 Illness benefits

4.2.4.1 Protection and benefits paid in terms of the Unemployment Insurance Act of 2001
A contributor is entitled to illness benefits for any period of illness if:
● he or she is unable to perform work due to illness

● he or she fulfils any prescribed requirements in respect of any specified illness
● the application is made for illness benefits in accordance with the prescribed
requirements and the provisions of the UIA
A contributor will not be entitled to such benefits if the illness lasts less than 14
days. He or she will not receive the benefit if he or she is already in receipt of
unemployment or adoption benefits, but not maternity benefits; or if, without just
reason, refuses or fails to undergo medical treatment or to carry out the
instructions of a medical practitioner, chiropractor or homeopath. The benefit can
be reduced to the difference between any sick leave paid to the contributor in
terms of any law, collective agreement or contract of employment for the period of
the illness, and the maximum benefit payable in terms of the Act. The benefit may
not be more than the remuneration the contributor would have received if
the contributor had not been ill, considering any sick leave paid. The procedure
followed when claiming the sickness benefits is the same as the one for
unemployment benefits.
A contributor qualifies for illness benefits in terms of the UIA only if he or she has
exhausted all illness benefits claimable in terms of the Basic Conditions of
Employment Act.
4.2.4.2 Protection and benefits paid in terms of the Basic Conditions of Employment Act of
1997 and the Labour Relations Act of 1995
Employees who are sick or injured cannot perform their duties and they can be
dismissed for incapacity.
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It is important to note that the concept “sickness” is used in this context as “some physical
or mental condition that prevents an employee from fulfilling his or her duties, either tem-
porarily or permanently”.
It should also be noted that the concept “unfair dismissal” refers to a dismissal not
effected for a fair reason and in accordance with a fair procedure, even if it
complies with any notice period in a contract of employment or in legislation
governing employment.
The illness or injury sustained by an employee may be of a temporary or
permanent nature, depending on the seriousness of the illness or injury.
Permanent illness or injury is dealt with differently from a temporary injury or
illness. An employee who suffers from a temporary illness or injury (in other words,
an illness or injury that is not protracted or that does not render the employee
incapable of performing the work for which he or she has been employed) is
entitled to sick pay in terms of the BCEA. Where the employee is absent for more
than two consecutive days, he or she is required to submit a medical certificate
to the employer. Failure to provide the certificate will entitle the employer to
withhold payment. An employee who suffers from a permanent illness or injury
that effectively renders him or her incapable of performing the duties for
which he or she was employed, may be dismissed on the basis of incapacity.
Although dismissal may appear harsh in these circumstances, it should be borne in
mind that an employer is under no obligation to keep an employee who, as a result
of an injury or illness, is incapable of performing his or her duties. However, in
order to ensure that dismissal is the last resort, it is required that the need to
dismiss be thoroughly investigated and that a fair procedure be followed. Should
this not be done, the termination of employment of such an employee would
amount to an unfair dismissal. In other words, the dismissal must be
substantively (reason for the dismissal) and procedurally (procedure or process
followed before the dismissal) fair.
Substantive fairness means that a valid and fair reason must exist. Procedural fairness re-
quires that a proper and fair procedure must be followed prior to dismissing the
employee.
In order to establish that a dismissal has been for a valid and fair reason (in other
words, in order to establish whether the incapacity is such that it warrants a
dismissal), an investigation into the procedural fairness must be conducted.
The affected employee has the right to participate in this investigation and, with the
assistance of a trade union representative or a fellow employee, to state his or her
case.
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Substantive fairness would entail the following:
There must be an investigation into the nature and degree of incapacity. If the
employee is not capable to perform the work, the employer must determine the
extent to which the employee is able to perform the work and the extent to which
the employee’s work circumstances could be adapted to accommodate disability;
where this is not possible, the extent to which the employee’s duties might be
adapted.
Procedural fairness would include:

giving an employee an opportunity to respond and make suggestions. The em-
ployee may be assisted by a fellow employee or union representative. The
employer must consult with the employee; the employer must consider available
medical information; and the employer must attempt to accommodate the em-
ployee where reasonably possible.
ACTIVITY 4.3
Read the following scenario and answer the question that follows. Lesedi is employed
as the personal secretary of Mrs Meyiwa, the managing director of a large retail store.
Lesedi has been feeling ill for quite some time but, because her office is extremely busy,
she has postponed a visit to her doctor. Mrs Meyiwa has recently told her staff that all
holiday leave is suspended for the next two months because management is busy with
negotiations to expand the store. All staff members are therefore needed to provide the
necessary administrative back-up during this difficult and busy time. Lesedi faints in the
boardroom one morning after working through the night to prepare the agenda for the
next board meeting. She is rushed to her doctor who informs her that she suffers from
severe stress and exhaustion. She is advised to take sick leave and to stay at home for
at least five days before returning to work. Lesedi follows the advice of her doctor and
stays home. On day three she receives a frantic call from Mrs Meyiwa who wants to
know why she is not at work. She informs her that she is ill and that she has been
advised to rest. Mrs Meyiwa threatens to dismiss her if she does not return to work
immediately. She also tells her that she will not be paid for the two days that she has
been absent from work. Lesedi comes to you for advice. Advise Lesedi with regard to
the following:
(1) Whether or not she is entitled to sick leave/pay.
(2) Whether or not she will be required to produce a medical certificate upon return-
ing to work.
(3) Assume that Lesedi is not entitled to any sick pay. Will she be entitled to claim
benefits in terms of the UIA?
An employee who suffers from a temporary illness is entitled to sick leave and sick pay
in terms of the BCEA. An employee who suffers from a permanent illness may be dis-
missed for incapacity provided that a fair procedure is followed before the dismissal. If
an employee is absent from work for more than two consecutive days, such an employ-
ee is required to produce a medical certificate. An employee who is no longer entitled to
sick leave is not entitled to sick pay, and such leave will be considered to be unpaid
leave. If Lesedi is a contributor in terms of the UIA, she will be entitled to illness benefits
in terms of the Act.
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4.2.5 Adoption benefits

One contributing adoptive parent is entitled to adoption benefits in terms of the
UIA in respect of each adopted child if the:
● child has been adopted in terms of the Child Care Act

● period that the contributor was not working was spent caring for the child
● adopted child is under the age of two
● application is made in accordance with the prescribed requirements and the
provisions of the Act
The contributor is entitled to benefits from the date that a competent court grants
an order for the adoption. The amount of the benefit can be reduced to the
difference between any other adoption benefit paid to the contributor.
4.2.6 Dependant’s benefits

These benefits are paid to the surviving spouse or life partner of a deceased
contributor. If there is no surviving spouse or life partner, or if he or she has not
made an application for benefits within six months of the contributor’s death, a
dependent child of the deceased is entitled to the benefits if the application is
duly made.
4.2.7 The Unemployment Insurance Contributions Act of 2002 (UICA)

The UICA was enacted to provide for the payment of contributions for the benefit
of the Unemployment Insurance Fund and to put in place procedures for the
collection of contributions. The UICA applies to all employers and employees,
including domestic and seasonal workers.
An employer to whom the UICA applies must apply for registration to the
Commissioner of the South African Revenue Service or the Unemployment
Insurance Commissioner. An employer who fails to pay the full amount payable on
or before the last day for payment pays interest on the outstanding amount. A
penalty of 10% of the unpaid amount is payable in respect of late payments in
addition to interest on the unpaid contributions. Any person convicted of an
offence related to compulsory unemployment insurance is liable for conviction to a
fine or imprisonment for a period not exceeding 12 months, or to both a fine and
such imprisonment.
4.3 OLD-AGE AND RETIREMENT PROVISION

4.3.1 General
Retirement provision takes different forms which include formal and informal
arrangements. Many countries, including South Africa, rely on mainly formal
arrangements. Informal arrangements take the form of survival measures
developed by individuals and/or communities to provide financial and social
support to one another. On the other hand, formal arrangements take the shape of
social assistance which comes in the form of the state old-age pension (discussed in
Learning unit 3 above) paid to the elderly who have reached 60 years and above
and social insurance which takes the shape of state-regulated retirement schemes.
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South Africa does not have a national or public retirement scheme. Therefore,
retirement in this country is provided for through private arrangements. Private
retirement provisioning is mainly regulated by the Pension Funds Act 24 of 1956
and Regulations to the Act. The effect of South Africa’s present retirement system
is that only the rich (who are able to make private provision) and those in formal
employment (with access to employment-based retirement funds) receive
protection. The rest must rely on their own means or on social assistance provision
which unnecessarily burdens the social assistance system.
The retirement system in South Africa takes a formal three-pillar approach comprising the
statutory pension in the form of social assistance, occupational (work-related) pension
schemes, and private schemes such as retirement annuities, private savings and insur-
ance policies.
The discussion here is, however, limited to occupational pension schemes.
4.3.2 Occupation retirement schemes

The main purpose of a pension or retirement fund is to provide a form of benefit to its
members when they retire – or to their dependents when the members die. The primary
purpose is, therefore, to support members during retirement and – should a member die –
to support the member’s family.
Occupational retirement schemes/funds take the form of social insurance

provided to protect employees and their dependants against loss of income or
support during employees’ retirement. An employer would normally establish a
retirement scheme taking the form of either a pension fund or a provident fund.
It is usually mandatory for employees of an employer who has already established a
retirement scheme to join that scheme. The benefits payable by virtue of
membership of a retirement fund are determined by the rules of that fund.
The distinction between a pension fund and a provident fund must be noted:
● A pension fund is a retirement fund which allows a member to take up to

one-third of the retirement benefit as a lump sum cash payment; the balance
has to be paid out in the form of a pension over the rest of the member’s life.
● A provident fund, on the other hand, is a retirement fund which allows a
member to take up to 100% of the retirement benefit as a lump sum cash
payment.
These funds can be established as “defined-benefit funds” or “defined-

contribution funds”. A defined-benefit fund is also known as a “fixed-benefit” or
“promised-benefit” fund.
The member of the fund is entitled to a benefit calculated using the period that the
member has been with the fund and his or her annual salary before retirement.
A defined-contribution fund is known as a “fixed-contribution” or “money-purchase” fund.

It may be considered as a savings vehicle. The benefit received from the fund depends
on the contributions made and the interest accumulated at the time the member retires.
Should a member of the fund leave employment before retirement, he or she will
be entitled to what is known as a “withdrawal benefit”. In addition, in terms of
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the Pension Funds Act, benefits payable from funds regulated by this Act may,
subject to certain exceptions, not be reduced, transferred, ceded, pledged,
hypothecated, attached or subjected to any form of execution under a
judgment or order of a court of law. The reason for this may be the fact that
retirement benefits serve a social security purpose and they therefore need
special protection to ensure that they are not depleted before the member’s
retirement date. A person who feels that a fund does not provide him or her with a
benefit payable in terms of the rules of a fund, or who feels aggrieved by the
decision of the trustees of a fund with regard to benefits, may lodge a complaint
with the office of the Pension Fund Adjudicator (PFA) which has been created to
specifically deal with pension related complaints.
4.3.3 Death Benefits: Section 37C of the Pension Funds Act

Section 37C of the Pension Funds Act establishes a compulsory scheme in terms
of which a death benefit must be paid out after the death of a member of the fund.
The section expressly restricts the deceased member’s freedom of testation in
respect of the benefit in that the benefit cannot form part of his or her estate.
Section 37C is intended to protect pension benefits from possible imprudence on
the part of members by restricting their capacity to dispose of their pension
benefits when they die. The rationale for this provision is that it promotes the ends
of social security by placing the benefit payable under the control of the board of
trustees of the fund. The fund may pay out the benefit to the member’s dependants
in such proportions as it deems equitable.
In other words, the state ensures that monies in respect of which it has allowed
major tax concessions are utilised for the benefit of the deceased member’s
surviving spouse and children, as well as any other persons dependent on the
member. This reduces the state’s liability to take care of its citizens who, but for the
pension money, would not have been able to support themselves. Section 37C gives
the board of trustees of a retirement fund discretionary powers which have to be
exercised reasonably and for their proper purpose. The board may therefore not
unduly fetter the exercise of its own discretionary power.
Even though there are no hard and fast rules to assist the trustees in the exercising
of their discretion, the Pension Funds Adjudicator has, over the years, ruled that
the following factors must be taken into consideration when a determination is
made:
● the ages of the beneficiaries
● their relationship with the deceased
● the extent of their dependency
● their financial affairs
● their future earning capacity and employment prospects
● the wishes of the deceased as expressed in the beneficiary nomination form
or other testamentary writing
● the amount that is available for distribution
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ACTIVITY 4.4
Write brief notes on why retirements benefits are given considerable protection by the
Pension Funds Act of 1956.
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The relevant parts of section 37C of the Pension Funds Act read as follows:
(1) Notwithstanding anything to the contrary contained in any law or in the

rules of a registered fund, any benefit payable by such a fund upon the
death of a member, shall not form part of the assets in the estate of such a
member, but shall be dealt with in the following manner:
(a) If the fund within twelve months of the death of a member becomes
aware of or traces a dependant or dependants of the member, the
benefit shall be paid to such dependant or, as may be deemed equi-
table by the board, to one of such dependants or in proportions to
some or all such dependants.
(b) If the fund does not become aware of or cannot trace any dependant
of the member within twelve months of the death of the member,
and the member has designated in writing to the fund a nominee
who is not a dependant of the member, to receive the benefit or such
portion of the pension as is specified by a member the benefit or
such portion shall be paid to such nominee.
(c) If a member has a dependant and the member has also designated in
writing to the fund a nominee to receive the benefit or such portion
of the benefit as is specified by the member in writing the fund shall
within twelve months of the death of such member pay the benefit
or such portion thereof to such dependent or nominee in such pro-
portions as the board may deem equitable.
The provisions of subsection 1 (a) cover a situation where the deceased member
has not nominated a beneficiary but is survived by dependants known to or
traced by the trustees of the fund. In such instances, the board of trustees shall pay
the benefit to the dependants in proportions as it may deem equitable.
Where a deceased member has nominated a person who was not a dependant and
the board has not become aware of or traced a dependant within the twelve-
month period, the board is obliged to distribute the benefit to that nominee on
the expiry of twelve months. Section 37C (1) (b) sets out two preconditions to
payment.
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The first precondition is the lapsing of the period to identify and trace dependants. The
second prerequisite is the designation of a non-dependent nominee in writing.
If the board does not become aware of or cannot trace a dependant within the
twelve-month period, “the benefit shall be paid to the nominee”. Where no
dependant is discovered within twelve months and no nominee is designated, the
benefit is payable to the estate of the deceased. Where there are both
dependants and nominees, the section requires payment to be made within twelve
months. Section 1 of the Act defines a “dependant” as follows:
Dependant in relation to a member of a retirement fund means –

a) a person in respect of whom the member is legally liable for maintenance;
b) a person in respect of whom the member is not legally liable for mainte-
nance, if such person –
i. was, in the opinion of the board, upon the death of the member in
fact dependent on the member for maintenance;
ii. is the spouse of the member;
iii. is a child of the member, including a posthumous child, an adopted
child, and a child born out of wedlock;
c) a person in respect of whom the member would have become legally liable
for maintenance had the member not died.
The definition of “dependant” is, in this regard, too wide and opens the door for
different categories of dependants and at different levels. This include legal
dependants, factual dependants and future dependants. Therefore, broadly
speaking, a dependant is a person whom a member is legally or factually liable to
maintain or whom the member would in future have become legally liable to
maintain.
The following people qualify as dependants: spouses, children and parents of the de-
ceased member. A live-in girlfriend or boyfriend and people living in a same-sex relation-
ship will also qualify if they can prove that they depended on the member prior to his or
her death.
Same-sex relationships are treated in the same way as other unions because section
9 of the Constitution prohibits unfair discrimination based on, among other
grounds, sexual orientation.
4.3.4 Administration and adjudication

Pension fund matters are primarily regulated by the Pension Funds Act of 1956
and the Income Tax Act 58 of 1962. The Pension Funds Act establishes ground
rules for the registration and proper administration of retirement funds. The
Income Tax Act contains measures intended to encourage working people to make
adequate provision for their retirement so as to relieve the state of this burden. The
incentive takes the form of tax savings. Employer and employee contributions to
funds that conform to certain standards are tax deductible and payouts from
approved funds also receive preferential tax treatment. The Registrar of Pension
Funds is appointed in terms of the Pension Funds Act. Boards of trustees
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appointed by employers and employees run pension funds although, in practice,

the administration of many of the funds is left to insurance companies. The rules
of each fund regulate its operation and administration and set out the rights and
obligations of various parties to the fund – the members and the employer in
particular.
In South Africa, there are a number of forums that handle complaints relating to retirement
funds, namely the Pension Funds Adjudicator, the Commission for Conciliation, Mediation
and Arbitration (CCMA), the Labour Court, the High Court and the Constitutional Court.
The office of the Pension Funds Adjudicator was established in 1996. Its function
is to investigate and determine complaints lodged in terms of the Pension
Funds Act in a procedurally fair, economical and expeditious manner. Therefore,
the Adjudicator’s jurisdiction is limited to Funds registered in terms of the Pension
Funds Act. Funds to which the state contributes financially do not fall under the
Adjudicator’s jurisdiction unless such a fund has, with the consent of the Minister,
registered with the Registrar of Pension Funds. In terms of the Act, complaints
must be lodged in writing within three years from the date of the event giving rise
to the complaint.
A person who is not satisfied with the determination of the Adjudicator may,
within six weeks after the date of the determination, apply for relief to the High
Court having jurisdiction over the matter. It is also possible to approach the High
Court directly without first lodging the complaint with the Adjudicator. It is also
possible to take a determination made by the Adjudicator to the High Court on
review.
ACTIVITY 4.5
Read the following scenario and answer the question that follows. Mampa has been a
member of a retirement fund managed by Better Returns Insurance for many years. He
joined the fund as part of his employment contract at Perfect Retailers. When joining
the fund, he also completed a nomination form in terms of which he nominated his two
sons from his first marriage as the beneficiaries in the event of his death. On his death
he is survived by four dependants: his two sons from his first marriage, his widow (his
second wife) and a daughter whom he and his second wife had adopted. Better
Returns Insurance, instead of acting in terms of the nomination, allocates the benefits
payable by the fund to all four dependants. Fully advise Mampa’s two sons on whether
they can approach the court to request an order declaring that benefits must be paid to
them to the exclusion of the second wife and the adopted daughter.
In order to complete this activity, you need to have a clear understanding of the provi-
sions of section 37C of the Pension Funds Act. In terms of section 37C, the benefits
payable by the retirement fund administered by Better Returns Insurance do not form
part of Mampa’s estate, and must be used, firstly, for the benefit of his dependants and,
secondly, for the benefit of those who have been nominated by him. It should be noted
that an adopted child is also considered to be a dependant. The trustees of retirement
funds have a general duty to act equitably when exercising their discretion to distribute
death benefits.
The next question which you will have to consider is whether the fact that Mampa has
explicitly nominated his two sons as beneficiaries without mentioning his adopted
daughter, changes the position in any way. Even though a member may nominate
certain dependants to the exclusion of others, it should be noted that, in terms of
section 37C, the benefits will be disposed of according to the provisions of the section.
All Mampa’s dependants will therefore be considered.
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4.4 INVALIDITY/DISABILITY PROTECTION

4.4.1 General
The issue of disability is covered in the Code of Good Practice on Key Aspects of
Disability in the Workplace. The Code is intended to guide employers and
employees on key aspects of promoting equal opportunities and fair treatment
of people with disabilities as required by the Employment Equity Act 55 of 1998.
The Code also seeks to help employers and employees understand their rights and
obligations and to promote certainty and reduce disputes to ensure that people
with disabilities can enjoy and exercise their rights at work. The ILO
Recommendation 168 of 1983 Concerning Vocational Rehabilitation and
Employment (Disabled Persons) considers a disabled person as an individual
whose prospects of securing, retaining and advancing in suitable employment are
substantially reduced as a result of a duly recognised physical or mental impairment.
Section 9(3) of the Constitution prohibits unfair discrimination. The state may
not unfairly discriminate directly or indirectly against anyone on, amongst other
grounds, disability. Section 6 of the Employment Equity Act further prohibits
unfair discrimination on the grounds of disability. A disabled employee has
a right not to be unfairly dismissed, although the employment of an employee
who is, as a result of a disability, unable to do the work he or she has agreed to do,
can be terminated provided that a fair procedure is followed prior to the
dismissal. Before termination, the extent of the employee’s ability to do the work,
the question whether reasonable measures can be taken to accommodate the
employee, and the availability of alternative work must be taken into account.
Section 187(1)(f) of the LRA provides that a dismissal is automatically unfair if
the reason for dismissal is that the employer unfairly discriminated against the
employee, either directly or indirectly, on the grounds of his or her disability. The
dismissal will be fair if it relates to the inherent requirements of the job.
ACTIVITY 4.6
Read the following scenario and answer the question that follows. Lala, a filing clerk at
an accounting firm, has suffered a stroke which affects her concentration, memory and
speech. Her contract of employment was terminated by her employer a week after she
had returned to work. Lala approaches you for advice. Discuss whether or not Lala’s
dismissal was unfair.
See the discussion under 4.4.1 and 4.2.5.2 above.
4.5 PROTECTION AGAINST MOTOR VEHICLE ACCIDENTS

The protection of persons against motor vehicle accidents is regulated by the
Road Accident Fund Act 56 of 1996 which established the Road Accident Fund
(RAF). The main objective of the Fund is the payment of compensation for loss or
damage wrongfully caused by the driving of motor vehicles. The Fund will
pay compensation with regard to claims arising from loss or damage caused by
the driving of a motor vehicle whether or not the identity of the owner or the
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driver, or the identity of both has been established. It is financed through a fixed
fuel levy. It pays compensation to the third party for any loss or damage suffered
as a result of any bodily injury or for the death caused by or arising from the
driving of a motor vehicle by any person at any place within the Republic of South
Africa. The obligation to pay only arises if the loss, or injury or death is due to
the negligence or wrongful act of the driver or of the owner of the motor
vehicle or of his or her employee in the performance of the employee’s
duties as employee.
(4.1) Define social insurance in your own words.
(4.2) Mention the elements of social insurance.
(4.3) Draw a distinction between a pension fund and a provident fund.
(4.4) Read the following scenario and answer the question that follows.
Tito was employed by TT Manufacturers when he lost his job a few months ago.
Tito has heard that you are studying social security law at university, and that you
will be in a position to advise him with regard to a claim he would like to make for
unemployment benefits. Advise Tito on the conditions that must be satisfied in
order for him to qualify for unemployment benefits.
(4.5) Explain the reasons behind maternity protection.
(4.6) Explain the protection given to an employee who is sick.
(4.7) Explain the protection given to an employee who is disabled.
(4.8) Describe, in your own words, the main objectives of the UIA and UICA.
(4.9) Identify the benefits paid in terms of the UIA.
(4.10) Describe the protection given to people who suffered damages or loss as a result
of a motor vehicle accident.
4.6 CONCLUSION
In this learning unit, you have learned about social insurance and the various risks
people are protected against. Those risks include old age, pregnancy,
unemployment, sickness, disability, and road accidents. Legislation establishing and
regulating different social insurance schemes was also referred to. It is important to
remember that social insurance is a form of insurance. It is financed through
regular contributions which, in the case of the Road Accident Fund, take the form
of a fuel levy.
Now that you have completed this learning unit, you should be able to understand what
social insurance entails and identify different types of social insurance schemes.
The next learning unit discusses the compensation for occupational injuries and
diseases, which is another form of social insurance.
4.7 GLOSSARY
Security The state of being free from any threat or harm.
Insurance An arrangement by which a company or the state undertakes
to provide a guarantee of compensation for specified loss,
damage, illness or death in return for payment of a specified
premium.
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Adjudicate To make a formal judgement on a disputed matter.

Procedure An established or official way of doing something.
Depend Requiring someone or something for financial or other
support.
Contribution Payment to a common fund.
Scheme An arrangement for attaining some particular object or put-
ting a particular idea into effect.
Retire To leave one’s job on reaching the normal age for leaving
service (work).
Deceased A person who has died.
Unfair dismissal When an employee’s employment is terminated or brought to
an end in an unjust or unreasonable manner.
Invalidity The condition of being too ill.
Adoption Bringing someone else’s child up as one’s own.
Equitable Treating everyone fairly and in the same way.
Seasonal worker An employee who works on a seasonal basis.
Spouse A husband or wife (in a marriage).
Practitioner Someone involved in a skilled job or activity.
Estate All the money and property owned by a person, especially at
death.
Lump sum A single payment (as opposed to smaller payments or
instalments).
ACTIVITY 4.7
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● define social insurance
● identify various social insurance schemes
● describe the unemployment benefits available in South Africa
● describe protection available to a female worker who is pregnant
● describe retirement schemes available to persons in their old age
● explain how the death benefits of a deceased member of a retirement scheme are
distributed
● explain protection given to employees who are sick
● explain protection given to the invalid or the disabled
● discuss the rights and entitlements of sick and disabled employees
● explain protection given to those involved in road accidents
● understand how social insurance schemes are financed and administered
68
Learning unit 5
Employment injuries and diseases
Learningunit5
Contents
5.1 INTRODUCTION 70
5.2 PROTECTION FROM EMPLOYMENT INJURIES AND DISEASE BY THE
COMPENSATION FOR OCCUPATIONAL DISEASES ACT 70
5.2.1 General 70
5.2.2 The objectives of the Compensation for Occupational Diseases Act 71
5.2.3 Dependants under the Compensation for Occupational Diseases Act 72
5.2.4 Scope of application of the Compensation for Occupational Diseases
Act 73
5.2.5 Benefits payable in terms of COIDA 74
5.3 COMPENSATION FOR OCCUPATIONAL DISEASES 75
5.4 COMPENSATION FOR OCCUPATIONAL DISEASES IN MINES AND
WORKS 75
5.5 CONCLUSION 77
5.6 GLOSSARY 78
In this learning unit, we look at social security protection given by the

Compensation for Occupational Injuries and Diseases Act 130 of 1993 (COIDA)
to employees who suffer injuries, contract diseases or die as a result thereof at
some point during their working lives. The learning unit also provides a brief
discussion of protection given by the Occupational Diseases in Mines and Works
Act 73 of 1973 (ODIMWA) to mine workers who develop certain occupational
diseases and the benefits payable to the dependants of workers who die from such
diseases.
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LEARNING UNIT 5: EMPLOYMENT INJURIES AND DISEASES

● describe the purpose of the Compensation for Occupational Injuries and Diseases
Act
● describe the purpose of the Occupational Diseases in Mines and Works Act
● advise an employee who suffered an injury or contracted a disease at work on the
social security benefits available to him or her
● advise a mine worker who developed an occupational disease or his or her depend-
ants about the social security benefits available to them
● advise an employee who was injured or who contracted a disease at work on how
to claim the benefits
5.1 INTRODUCTION
The Compensation for Occupational Injuries and Diseases Act 130 of 1993
(COIDA) provides a safety net to employees who contracted diseases or sustained
injuries at work.
The purpose of COIDA is to provide compensation for employees who, in the course of
their employment, suffer disablement as a result of a work-related injury or as a result of
contracting a work-related disease, or died as a result of a work-related injury or disease.
The Occupational Diseases in Mines and Works Act (ODIMWA) provides for
mandatory reporting and the payment of certain benefits to workers who develop
certain occupational lung diseases, as well as the payment of certain benefits to the
dependants of workers who die from such diseases. ODIMWA protects employees
against the risk of contracting a compensatable disease while performing risk
work in or at or in connection with a mine or particular work or all work
performed in or at or in connection with any mine or works. Thus, the Act
only covers employees in mines and works.
5.2 PROTECTION FROM EMPLOYMENT INJURIES AND DISEASE

BY THE COMPENSATION FOR OCCUPATIONAL DISEASES
ACT
5.2.1 General
The Compensation for Occupational Diseases Act is the main legislative tool
regulating occupational injuries and diseases in the country. This Act is
administered by the Department of Labour.
COIDA provides a system of no-fault compensation for employees who are injured in ac-
cidents that occur out of and in the course of their employment, or who contract occupa-
tional diseases at work. COIDA provides benefits for employees in the case of temporary
and permanent disablement, as well as for dependants of employees who die as a result
of injuries sustained or diseases contracted at work.
In terms of the Act, an employee is defined as a person who has entered into, or works
under, a contract of service or apprenticeship or learnership with an employer, whether
the contract is express or implied, oral or in writing, and whether the remuneration is cal-
culated by time or by work done or is in cash or in kind.
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COIDA defines an “employer” as any person, including the state, who employs an em-
ployee, and includes any person controlling the business of an employer, if the services of
an employee are lent or let or temporarily made available to some other person by his em-
ployer, such employer for such period as the employee works for that other person; and a
labour broker who, against payment, provides a person to a client for the rendering of a
service or the performance of work, and for which service or work such person is paid for
by the labour broker.
5.2.2 The objectives of the Compensation for Occupational Diseases

Act
The main purpose of COIDA is to provide for compensation for injuries or
diseases sustained or contracted by employees in the course of their employment.
Employers are, and have always been, obliged to ensure safe working conditions
for their employees. Prior to the implementation of COIDA and under common
law, an employee could claim compensation from an employer based on a delict if
an injury or illness arose from such unsafe working conditions. This was a matter
that implied a great deal of risk for the employer. Accordingly, the state stepped in
to balance the interests of employers and employees. Employers, on the one hand,
need to be protected from limitless liability whereas employees, on the other hand,
need to be protected from unsafe working conditions. In terms of COIDA, an
employer must pay an annual amount to the Compensation Fund on behalf of its
employees. If an employee is injured or killed or becomes ill or disabled as a result
of a workplace accident or a workplace-related disease, the employee or his or her
dependants are able to claim from the Compensation Fund.
Coverage is provided on a no-fault basis. What this means, is that the employee or
the dependants will be compensated regardless of whether the employer was at
fault, whether the incident was caused by the employee’s own negligence, or
whether it was due to the negligence of any other person.
The administration of COIDA is vested in state officials in a three-tier hierarchy,
namely the:
● Department of Labour
● Director-General of Labour (hereafter the Director-General)
● Compensation Commissioner (who is appointed by the Minister and fulfils
the majority of tasks prescribed by the Act)
Failure to comply with any of the obligations imposed by the Act will amount to a
criminal offence. In addition, the Commissioner has the power to penalise
employers who do not comply with statutory obligations.
SSL2601/1 71
COIDA applies to almost all employers and to all casual and full-time employees
but specifically excludes the following persons:
(a) a person, including a person in the employ of the state, performing military
service or undergoing training and who is not a member of the permanent
force of the South African Defence Force
(b) a member of the permanent force of the South African Defence Force
while on service in defence of the Republic
(c) a member of the South African Police Service while employed on service
in defence of the Republic
(d) a person who contracts for the carrying out of work and himself engages
other persons to perform such work
(e) a domestic employee employed as such in a private household
(f) anyone employed outside South Africa for 12 or more continuous months
(g) anyone on temporary work assignment in South Africa
The effect of these exclusions, in particular (d) & (e), is that people in the informal
sector and domestic workers who sustain occupational injuries and/or diseases are
left without any form of social protection. They have to rely on other (probably
informal social security) measures or on their families for financial help or support.
The risk of sustaining occupational injuries and diseases is even greater for people
in the informal sector than for those in the formal sector because they work under
less strict supervision and often in more dangerous and desperate situations. This
means that, ironically, those in need of more protection have, in fact, less
protection in terms of the formal social security system.
ACTIVITY 5.1
Write brief notes on the objectives of the COIDA.
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5.2.3 Dependants under the Compensation for Occupational Diseases

Act
Section 1 of COIDA defines a dependant of an employee as:
(a) widow or widower who at the time of the employee’s death was married to
the employee according to civil law;
(b) A widow or widower who at the time of the employee’s death was a party
to a marriage according to indigenous law and custom, if neither the hus-
band nor the wife was a party to a subsisting civil marriage;
72
(c) If there is no widow or widower referred to in paragraph (a) or (b), a per-

son with whom the employee was at the time of the employee’s death
living as husband and wife;
(d) A child under the age of 18 years of the employee or of his or spouse, and
includes a posthumous child, a stepchild, an adopted child and a child born
out of ‘wedlock’;
(e) A child over the age of 18 years of the employee or of his or her spouse,
and a parent or any person who in the opinion of the Director-General
was acting in the place of the parent, a brother, a sister, a half-brother or
half-sister, a grandparent or a grandchild of the employee.
In Langemaat v Minister of Safety and Security (1998) 3 SA 312 (T), the court held that
the definition of dependant in an Act which did not include a partner in a same-sex
union was inconsistent with the right not to be unfairly discriminated against in
terms of section 9 (3) of the Constitution of the Republic of South Africa.
Therefore, the concept “dependant” should be understood to cover persons in
same-sex unions.
ACTIVITY 5.2
Read the following scenario and answer the question. X and Y have been living
together in a same-sex relationship for a number of years. X is unemployed and relied
on Y’s income to sustain the common household. X lodges a claim in terms of COIDA
but is informed that, since he is not a dependant as defined in the Act, his claim will not
be entertained. X approaches you for advice. Advise him fully.
The starting point would be an analysis of the definition of a dependant as contained in

section 1 of COIDA. On the face of it, X could not be considered to be Y’s dependant
and would therefore not have a claim in terms of COIDA. But this is not the end of the
matter. Reference must be made to the discussions under paragraph 2.5 in Learning
unit 2 above and also to the decision of Langemaat v Minister of Safety and Security
(1998) 3 SA 312 (T). In this case, the court held that the definition of “dependant” must
be interpreted to include partners in a same-sex union.
5.2.4 Scope of application of the Compensation for Occupational

Diseases Act
If an employee meets with an accident resulting in his disablement or death, such
employee or his or her dependants will, subject to the provisions of COIDA, be
entitled to the benefits provided for and prescribed in the Act. In terms of the Act,
an accident must have arisen out of and in the course of the employment of an
employee. The accident must occur while the employee is busy with his or her
duties. The accident must be causally connected to the employee’s duties. It must
have been the employment that brought the employee within the range or zone of
the accident.
An accident shall be deemed to have arisen out of and in the course of the
employment of the employee notwithstanding the fact that the employee was, at
the time of the accident, acting contrary to any law applicable to his employment or
to any order by or on behalf of his employer. The accident shall be so deemed even
if the employee acted without the order of his employer. However, the Director-
SSL2601/1 73
General must be of the opinion that the employee was acting for the purposes of
or in the interests of or in connection with the business of his employer. The
provisions above also apply to a disease contracted by an employee at work. If the
employee has contracted a disease and the commissioner is of the opinion that that
the recovery of the employee is being delayed or that his temporary total
disablement is being prolonged by reason of some other disease from which the
employee suffers, he may approve medical aid also for such other disease for so
long as he may deem it necessary. If an employee has contracted a disease resulting
in permanent disablement and if that disease is aggravated by some other disease,
the Director-General may, in determining the degree of permanent disablement,
have regard to the effect of such other disease.
For the purposes of COIDA, the commencement of a disease shall be deemed to
be the date on which the medical practitioner diagnosed that disease for the first
time or such earlier date as the Director-General may determine if it is more
favourable to the employee. Schedule 3 of the COIDA contains a list of diseases
covered and compensated for under the Act.
ACTIVITY 5.3
Read the following scenario and answer the question. Mr X is employed by the
University in Pretoria. He is given a motor vehicle from the university’s car pool and is
instructed to collect examination scripts from the regional office in Johannesburg. Mr X
is involved in an accident on his way to the Mpumalanga Province and is badly injured.
Mr X approaches you for advice since he wants to claim compensation for his injury.
Advise him. Would it make any difference to your answer had Mr X been injured after
he had been hijacked on his way to Johannesburg and forced to drive to Mpumalanga?
It should be clear to you that COIDA covers accidents that arise out of and in the ordi-
nary course of an employees’ employment. The issue in the present case is whether
the accident arose out of and in the course of employment. It seems that this was not
the case. Mr X was instructed to collect scripts in Johannesburg, but the accident took
place in the Mpumalanga Province. Clearly, Mr X had no reason to be there and he will
not be entitled to compensation. However, if Mr X had been hijacked and forced to drive
to Mpumalanga, the answer would have been quite different. In such a case, it could be
said that Mr X’s injuries arose out of, and in the course of, his employment.
5.2.5 Benefits payable in terms of COIDA

An employee who claims from the Compensation Fund can claim for:
● temporary disability
● permanent disability
● medical expenses
In addition, benefits are payable to the dependants of employees who die as a

result of a work-related accident or disease. These benefits are calculated in terms
of formulae set out in COIDA and regulations published in terms of COIDA. The
Compensation Fund does not pay for pain and suffering, only for loss of
movement in or use of the body. Compensation for permanent disability is paid
either as a monthly pension or as a lump sum.
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5.3 COMPENSATION FOR OCCUPATIONAL DISEASES

There is a certain overlap between claims for compensation following an accident
and claims for compensation following occupational disease. Section 65(6) of
COIDA specifically provides that the provisions of this Act regarding an accident
will apply mutatis mutandis to diseases provided for in Schedule 3 of the Act, except
where the provisions are clearly inappropriate.
The following process illustrates the way in which an employee’s claim for
compensation for an occupational disease is handled:
● 1st step: As soon as possible after the commencement of a disease, but within
12 months (section 65(4)), the employee must give written notice to the em-
ployer (where he or she was last employed) and notice may also be given to
the Commissioner (section 68(1)).
● 2nd step: Within 14 days of having received notice of an occupational disease,
the employer must report it to the Commissioner (section 68(2)).
● 3rd step: The inquiry by the Commissioner into the occupational disease as
well as the Commissioner’s consideration of the claim (COIDA Schedule 3)
follow (sections 40 and 45).
The following are the steps which should be followed where an employee wishes to
claim for compensation subsequent to an accident:
● 1st step: As soon as possible after the accident, but within 12 months (section
44); the employee must be given written or verbal notice of the accident to
the employer.
● 2nd step: Within seven days of having received the notification of the accident,
the employer must report it to the Commissioner (section 39).
● 3rd step: The enquiry by the Director-General into the accident and consider-
ation of the claim will follow (sections 40 and 45).
The employee will also be required to:
● furnish particulars in support of the claim (s 41)

● submit to a medical examination (s 42)
● appear at a formal hearing (s 46)
5.4 COMPENSATION FOR OCCUPATIONAL DISEASES IN MINES

AND WORKS
Persons who are employed or who have been employed in mines or works and
who suffer from a “compensatable disease” contracted as a result of risk
work at or in connection with a controlled mine or controlled works may
receive compensation in terms of the Occupational Diseases in Mines and Works
Act 73 of 1973 (ODIMWA). The Act precludes a common law claim arising from
a compensatable disease against the operator of a mine. This Act provides
compensation for occupational lung diseases in miners and ex-miners only. It is
administered by the Medical Bureau for Occupational Disease (MBOD), which
falls under the Department of Health’s Chief Directorate: Non-Communicable
SSL2601/1 75
Diseases. The MBOD is responsible for the benefit-related medical examination of

miners and ex-miners. ODIMWA provides for post mortem benefits (through the
National Institute for Occupational Health’s Pathology Section) for miners if an
occupational disease is found, even if it was not the cause of death. ODIMWA pays
lump sum benefits based on the level of impairment and does not make any further
pension provision. The low fence for lung function loss is 35% in order for
compensation to be paid out. All medical expenses, including a follow-up related to
the treatment of a lung disease, is paid by the mine owner (s). A person who
receives a benefit under ODIMWA is not entitled to claim under COIDA.
A significant development relating to ODIMWA can be found in a judgment by
the Constitutional Court in Mankayi v AngloGold Ashanti Ltd. In this case, a
distinction was drawn between the application of COIDA and ODIMWA. The
main question was whether or not section 35 (1) of COIDA (which excluded
Mankayi from its scope of application), was constitutional. The Constitutional
Court further looked at sections 100 (2) of ODIMWA (Occupational Diseases in
Mines and Works Act, 1973) and 35(1) of COIDA.
The applicant, Mankayi, was employed as an underground mineworker by the
respondent (AngloGold Ashanti Limited) for 16 years. He alleged that, during his
employment, the respondent had negligently exposed him to harmful dusts and
gases as a result of which he contracted diseases in the form of tuberculosis and
chronic obstructive airways disease, which had rendered him unable to work as a
mineworker or in any other occupation.
It was on this basis that he challenged the findings of both the South Gauteng
High Court and the Supreme Court of Appeal in which section 35(1) of COIDA
was interpreted as extinguishing mineworkers’ common law right to sue the
employer for occupational injuries sustained and diseases contracted during the
course of employment, while protecting the employer against claims arising from
non-compliance with the common law duties of the employer, such as the duty to
provide a safe working environment. Among other things, the court had to decide,
firstly, whether an “employee”, as envisaged by section 35 of COIDA, included
employees covered by ODIMWA, notwithstanding the fact that the latter were
barred from claiming under COIDA; secondly, whether the common law remedy
could be extended to include employees falling within the protective scope of
ODIMWA. The court found that the definition of employee in COIDA
corresponds with the meaning of employee in ODIMWA, but that the word
“employee” in section 35 and in the interpretation clause applied only to COIDA
and those beneficiaries under COIDA, and not to the beneficiaries under
ODIMWA. The court also found that there was no bar to a civil claim under
ODIMWA where employees were precluded from claiming under COIDA.
According to the court, the two pieces of legislation had to be viewed separately
because even though they shared common boundaries, they were mutually
exclusive, each with its own scope of application. The court held that the definition
of the words “employee” and “employer” respectively do not expressly exclude
employees who could have a claim for compensation under ODIMWA, and that
ODIMWA provides statutory compensation for designated compensatable diseases
contracted at controlled mines and works. The court further held that apart from
providing compensation for occupational injuries, COIDA also provides for
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statutory compensation in respect of a number of listed occupational diseases

contracted by employees in the course of their employment and resulting in
disablement or death. According to the court, the diseases that constitute
“compensatable diseases” under ODIMWA overlap with the diseases that
constitute “occupational diseases” under COIDA. In the case of the applicant, the
disease contracted could fall within both COIDA and ODIMWA, but section 100
(2) of ODIMWA precludes him from claiming under COIDA. The Court stated
that section 100 (1) of ODIMWA prohibits double-dipping and section 100 (2)
expressly prohibits employees benefiting under ODIMWA from also claiming
under COIDA.
The employee referred to in section 35(1) whose common law claim is expunged, is
limited to an employee who has a claim for compensation under COIDA in respect
of occupational diseases mentioned in the Act. It is this employee that section 35
(1) of COIDA excludes from instituting a claim for the recovery of damages
against the employer for occupational diseases resulting in disablement or death.
The expungement does not extend to an employee who is not entitled to claim
compensation in respect of “occupational diseases” under COIDA.
ACTIVITY 5.4
Read the following scenario and answer the question: Dunny has been employed as a
mineworker for several years. He contracted silicosis while working at the mine. Dunny
wants to claim damages from the mine in respect of the disease he contracted. Will
Dunny be prevented by section 35 of COIDA from making a claim in terms of
ODIMWA?
In Mankayi v AngloGold Ashanti, it was held that section 35 of COIDA only applies to
employees as defined in that Act. Therefore, Dunny can claim under ODIMWA and, if
not covered by ODIMWA, he can claim damages from his employer under common law.
(5.1) What is the purpose of COIDA?
(5.2) Who is an employee in terms of COIDA?
(5.3) Who is an employer in terms of COIDA?
(5.4) When is an employee entitled to compensation under COIDA?
(5.5) What are the steps to be followed when making a claim under COIDA?
(5.6) Define a dependant of an employee in terms of COIDA.
(5.7) What is the purpose of ODIMWA?
(5.8) When does a claim for compensation for an accident under COIDA become
prescribed?
(5.9) Can a person claim under COIDA and ODIMWA at the same time?
(5.10) When does a disease commence in terms of COIDA?
5.5 CONCLUSION
There are various pieces of legislation that afford protection to employees who
contract diseases or sustain injuries at work. It is important to be able to draw a
clear distinction between protection under COIDA and protection under
ODIMWA.
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Now that you have completed this learning unit, you should be able to know and under-
stand the objectives of COIDA and ODIMWA and the social security benefits available
under these statutes.
5.6 GLOSSARY
Insurance An arrangement by which a company or the state undertakes
to provide a guarantee of compensation for specified loss,
damage, illness, or death in return for payment of a specified
premium.
Depend Requiring someone or something for financial or other
support.
Scheme An arrangement for attaining some particular object or put-
ting a particular idea into effect.
Compensate Give someone something, for example money, in recognition
of loss, suffering or injury.
Commissioner A person appointed by a commission or a person who has
been given a commission or authority to do something.
Formal sector A well-regulated or organised sector in which jobs are recog-
nised as income sources on which income tax must be paid.
Informal sector It refers to workers who are self-employed or who work for
those who are self-employed, or to workers whose jobs are
unprotected and unsecured, and who generally do not pay tax.
Damages It refers to physical harm that impairs the value, usefulness or
normal function of something OR to a sum of money
claimed or awarded in compensation for a loss or injury.
Occupational That which relates to a job or profession.
Labour broker It is a person or company that provides workers/employees
to a client (employer) on a temporary basis.
Scope of The extent of the area or subject matter that something deals
application with.
Mutatis mutandis To make necessary alterations/changes while not affecting
the main point (it is used when comparing two or more situa-
tions/cases).
Chronic Something that persists for a long time.
Statutory Required by statute/law.
Claimable To demand or ask for something that is due to you.
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ACTIVITY 5.5
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● describe the purpose of the Compensation for Occupational Injuries and Diseases
Act
● describe the purpose of the Occupational Diseases in Mines and Works Act
● advise an employee who suffered an injury or who contracted a disease at work on
the social security benefits available to him or her
● advise a mine worker who developed an occupational disease or his or her depend-
ant/s about the social security benefits available to them
● advise an employee who was injured or who contracted a disease at work on how
to claim benefits
SSL2601/1 79
Learning unit 6
Health care
Learningunit6
Contents
6.1 INTRODUCTION 81
6.2 THE NATURE OF THE HEALTH CARE SYSTEM IN SOUTH AFRICA 81
6.3 THE CONCEPT OF HEALTH CARE 83
6.4 THE CONSTITUTIONAL RIGHT TO HEALTH CARE IN SOUTH
AFRICA 84
6.5 THE NATIONAL HEALTH ACT 61 OF 2003 86
6.6 REFORM OF SOUTH AFRICA’S HEALTH CARE SYSTEM 86
6.6.1 General 86
6.6.2 The Taylor Committee Report on South Africa’s health care system 87
6.6.3 The National Health Insurance 87
6.7 CONCLUSION 88
6.8 GLOSSARY 89
This learning unit discusses South Africa’s health care system, the constitutional
right to health care and issues related thereto in a social security context. The
learning unit further looks at the reform of South Africa’s health system and, in
particular, the introduction of the National Health Insurance (NHI).

● explain how the Constitution provides for the right to health care in South Africa
● describe South Africa’s public health system
● describe South Africa’s private health care system
● describe the challenges facing the health system in South Africa
● explain the objectives of the National Health Insurance (NHI)
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6.1 INTRODUCTION
Section 27(1)(a) and (3) of the Constitution of the Republic of South Africa 1996
specifically mentions the right of everyone to have access to health care
services, including reproductive health care, and the right not to be refused
emergency medical treatment. Health care in South Africa consists of a public
and a private component.
6.2 THE NATURE OF THE HEALTH CARE SYSTEM IN SOUTH

AFRICA
South Africa currently does not have a public health care insurance system,
although public health care is available in the form of primary health care which is
provided through public hospitals. Free health care is available to old people,
pregnant women and children, and it is offered at public primary-health care clinics
and community health care centres.
The lack of an effective health system results in poor people having to shoulder
the high costs of health care themselves. Their only access to affordable health care
is through the public health care system which generally offers inferior services
compared to those offered by the private health care system. This results in a lack
of protection of the poor against the high costs of health care.
Note should be taken though that South Africa is in the process of introducing a unified
health care system in the form of the National Health Insurance (NHI) which is aimed at
delivering quality health care to all citizens.
Through the introduction of the NHI government aims, among other things, to:
● unify the fragmented health services at all levels into a comprehensive and in-
tegrated national system
● reduce disparities and inequalities in health service delivery and increase ac-
cess to improved and integrated services based on primary health care
principles
● give priority to maternal, child and women’s health
● mobilise all partners including the private sector, NGOs and communities, in
support of an integrated national health system
Public as well as private health care plays an important role in every health care
system. The public health care system is funded by government through tax
revenue. South Africa’s public health care system is very limited and does not
allow everyone in the country to have proper access to medical care. The rich or
those who work in the formal sector of the economy belong to private or
employment-based medical aid schemes which offer better services, even
though at a high cost. The latter takes the form of social insurance because people
contribute to the funds (schemes), and when they are ill or in need of medical help,
they are funded from these funds. A member of a medical scheme is indemnified
against the actual cost of the health service rendered. For example, if a person who
is covered by the scheme goes to hospital to receive treatment, the medical scheme
will cover the costs of the treatment. Private provision is regulated by the Medical
Schemes Act 131 of 1998. Medical insurance is governed by the Long-term
SSL2601/1 81
LEARNING UNIT 6: HEALTH CARE
Insurance Act 52 of 1998 and the Short-term Insurance Act 53 of 1998. The
private sector is accessible to a restricted number of people due to the
financial implications. Membership of the medical aid schemes is generally based
on the conditions of employment. Thus, access to medical services or sickness
benefits is limited to people who are covered by medical insurance or medical aid
schemes.
People who do not belong to the medical aid schemes mostly rely on public
hospitals. This is a form of social assistance because their treatment is subsidised
by the state. The public sector is generally used by low-income earners, the
unemployed and by indigent persons who cannot afford to pay for health insurance
schemes.
The public sector is characterised by a lack of resources and inadequate
capacity to handle the high demand for primary health care, especially by poor
communities. The health system in this country does not provide universal
coverage and, as a result, the majority of poor people are excluded from coverage.
The main challenge faced by the present government in the achievement of
acceptable levels of health care services relates to the elimination of inequalities in
the access to health care. These inequalities emanate from the policies of the
apartheid regime. Before the introduction of a democratic country in 1994, the
country’s health care system differentiated between races and different races
received different levels of health care.
The greatest national priority and challenge for the government has been the HIV/
AIDS pandemic and the cost of anti-retroviral drugs to treat patients with HIV/
AIDS. This raises important issues relating to the challenge of giving effect to
everyone’s constitutional right to have access to health care and social security. The
most important issues in this regard include:
● equitable access to health care

● availability of resources
● the cost of health care
ACTIVITY 6.1
Read the following scenario and answer the question. Your friend Sissy wants to follow
a career in health care. She has heard that your module Social Security Law covers the
provision of health care in South Africa and she decides to ask you to explain to her
what the system entails. Advise Sissy on the nature of South Africa’s health care
system.
Did you remember the fact that the system consists of public and private health care?
Public health care is mostly for the poor and those who are not covered by private medi-
cal schemes. It is funded by the state through tax revenue. On the other hand, private
health care is for those who are employed in the formal sector of the economy. Mem-
bers of private medical schemes make contributions to the schemes. South Africa is in
the process of introducing the National Health Insurance.
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ACTIVITY 6.2
Can you also advise Sissy about the shortcomings found in South Africa’s health care
system?
Public health care is mostly for the poor and those who are employed in the informal
sector of the economy. It is characterised by a lack of resources and inadequate ca-
pacity to handle the high demand for primary care by especially poor people and com-
munities. The system does not provide universal coverage and, as a result, the majority
of poor people don’t have adequate protection. The public health care system is ex-
tremely limited and does not allow everyone in the country to have proper access to
medical care. The rich and those who work in the formal sector of the economy belong
to private or employment-based medical aid schemes which offer better services, but at
a very high cost.
6.3 THE CONCEPT OF HEALTH CARE

The World Health Organisation (WHO) defines health as “a state of complete
physical, mental and social well-being and not merely the absence of disease”. The
Department of Health in South Africa regards health as more than simply the
absence of disease. Health services, encompassing promotive, preventative and
curative services, and environmental factors such as clean water, sanitation and
education, are recognised as fundamental to the improvement of the health status
of individuals and populations. According to the court in Soobramoney v Minister of
Health, Kwazulu-Natal, a healthy life depends on a number of things which include
the quality of air, water and sanitation, the quality of health care and support given
by medical institutions and families, friends and the community. Health is one of
the classical risks covered by the ILO Convention (Minimum Standards),
Convention 102 of 1952.
The minimum content of health benefits according to this Convention should
cover:
● general-practitioner (GP) care and home visits
● specialist care in and out of hospitals
● hospitalisation where indicated
● essential pharmaceutical needs
● in the case of pregnancy, pre-natal, confinement and post-natal care
The Medical Care and Sickness Benefits Convention 130 of 1969 has added the
following benefits to the five mentioned above:
● dental care
● medical rehabilitation including the necessary appliances
The following are considered to be the basic minimum standards of health care:
● the provision of accessible and affordable primary health care services for all
● health care policies should be comprehensive and equitable
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● the general health status of an individual will be determined by socio-econom-

ic conditions and discrimination or a lack of equity in the provision of health
services – the improvement of socio-economic conditions and the provision
of basic services such as water, sanitation, housing and education, will help to
improve the health status of the community and to eradicate discrimination in
the provision of health care
● for those who are not able to secure services or resources, there should be the
so-called safety nets to ensure at the very least emergency medical treatment
6.4 THE CONSTITUTIONAL RIGHT TO HEALTH CARE IN SOUTH

AFRICA
The Constitution of the Republic of South Africa entrenches a range of socio-
economic rights, including the right to health care.
Section 27 provides as follows:
(4) Everyone has the right to have access to –
(d) health care services, including reproductive health care;
(e) sufficient food and water; and
(f) social security, including, if they are unable to support themselves and
their dependants, appropriate social assistance.
(5) The state must take reasonable legislative and other measures, within its avail-
able resources, to achieve the progressive realisation of each of these rights.
(6) No one may be refused emergency medical treatment.
The state must, in terms of section 7 (2) of the Constitution, respect, protect,
promote, and fulfil the right to have access to health care. There are, however,
other provisions in the Constitution dealing with health care rights such as section
12(2), which provides everyone with the right to, among other things, bodily and
psychological integrity, including the right to make decisions concerning
reproduction and not to be subjected to medical or scientific experiments without
their consent.
Section 24 (a) gives everyone the right to an environment that is not harmful to
their health and section 35 (2) (e) gives everyone who is incarcerated by the state,
including every sentenced prisoner, the right to conditions of detention that are
consistent with human dignity, including the provision of adequate medical
treatment at the state’s expense. On the other hand, children are given special
protection by section 28 (1) (c) which guarantees them basic health care services.
There are also constitutional provisions which have an indirect bearing on the right
to health care. They include the right to equality, human dignity, life, housing, food,
water, and social security. The Constitutional Court has affirmed that all the rights
in the Bill of Rights are interrelated and mutually supportive. It is therefore not
sufficient to try to adopt measures which give effect to the right to have access to
social security in isolation. Thus, when developing a social security system, the state
must ensure that all related constitutional values and rights, such as human dignity,
freedom and equality, are given effect to along with access to resources necessary
for the realisation of the right to have access to social security and other related
rights. Such access has particular reference to food, clothing, shelter and, where
84
appropriate, land. Adequate support must be given to those in need as a matter of

priority.
While courts of law may be hesitant to interfere with budgetary provision in the
area of social security, the Constitutional Court has indicated (in Ex Parte
Chairperson of the Constitutional Assembly: In Re Certification of the Constitution of the
Republic of South Africa 1996 (4) SA 744 (CC); Government of the Republic of South Africa
and others v Grootboom 2001 (1) SA 46) that courts can grant orders that may have
budgetary implications. Further, in terms of section 27 (2), the state is obliged to
achieve the progressive realisation of the right to health care. The right to have
access to health care must be afforded to everyone in terms of section 27(3). No
one may be refused emergency medical treatment. It would appear that the
purpose of subsection (3) is to ensure that emergency treatment, which is available
and necessary in a particular set of circumstances, should be provided immediately
and that bureaucratic formalities do not prevent the administration of emergency
treatment. For example, no one should be refused the use of an ambulance and
emergency services, where such services exist, in a situation which would justify
such use. Also, no one may be turned away from a hospital which has the capacity
to provide the necessary emergency treatment.
It should be noted, however, that just like the other rights in the Bill of Rights, the
right to have access to health care services is not absolute. This right can be
limited by the internal limitation in section 27(2) of the Constitution and in terms
of the “general limitation clause” under section 36 of the Constitution. Refer in
this regard to paragraph 2.4 which deals with the scope of everyone’s right to have
access to social security and paragraph 2.8 (in Learning unit 2) which discusses the
general limitation of the right.
It should be noted that the right to have access to health care does not necessarily mean
that any person can demand and receive whatever type of health care they want and at
any time.
The government has to allocate the budget for the health care provision from the
tax revenue. Government further has to make sure that money spent on health care
is spent properly and reasonably. The state will be obliged by section 27(2) to take
reasonable legislative and other measures, within its resources, to achieve the
progressive realisation of this right. For example, government may, in its
progressive endeavours to make sure that everyone has access to health care, be
allowed to use the lack of resources as an excuse to defend its failure to achieve
partial or full realisation of the right as long as measures or programmes
undertaken by government are considered to be reasonable under the
circumstances.
ACTIVITY 6.3
Describe the constitutional right to have access to health care in South Africa in your
own words.
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In terms of section 27(1)(a) of the Constitution, everyone has the right to have access
to health care including reproductive health care, and section 27 (3) provides that no
one may be refused emergency medical treatment. The state is obliged by section 7(2)
of the Constitution to respect, protect, promote, and fulfil the right to have access to
health care. On the other hand, section 27(2) obliges the state to take reasonable legis-
lative and other measures, within its available resources, to achieve the progressive
realisation of the right to health care. This right is not absolute since it can be limited in
terms of the general limitation clause (section 36 of the Constitution) and the internal
limitation of the right as contained in section 27(2) of the Constitution.
Note should be taken that there are other constitutional provisions which have a
bearing on the right to have access to health care which include the right to equality,
human dignity, life, housing, food, water, and social security.
6.5 THE NATIONAL HEALTH ACT 61 OF 2003

The National Health Act of 2003 gives effect to section 27(2) of the Constitution,
which gives everyone the right to have access to health care services including
reproductive health, and section 27(3), which provides that no one may be refused
emergency medical treatment. The Act also protects and promotes children’s rights
to basic nutrition and basic health care services guaranteed under section 28(1)(c)
of the Bill of Rights. It further sets out the rights and duties of health care
providers, health workers, health institutions and users. The user’s rights include
the right to full knowledge of his or her health status except where such disclosure
would be contrary to the user’s best interests; knowledge of the diagnostic
procedures and treatment options available to the user; knowledge about the
benefits, risks, costs and consequences associated with each option; and the right to
participate in any decision affecting his or her personal health and treatment. The
national, provincial, district and municipalities have the duty to disseminate
information on health services for which they are responsible. This information
must include the types and availability of health services; operating schedules
and timetables of visits; procedures for access to health services; procedures
for laying complaints; and the rights and duties of users and health care
providers.
6.6 REFORM OF SOUTH AFRICA’S HEALTH CARE SYSTEM

6.6.1 General
The overriding aim of health reform since 1994 has been to undo the effects of
the apartheid policies and to fulfil a promise made by the Constitution to
build a “democratic state founded on the values of human dignity, the
achievement of equality and the advancement of human rights and
freedoms”.
Good health and access to health care services are essential for people’s rights to equal-
ity and dignity and are the core values enshrined in the Constitution.
In April 1997 government published the White Paper for the Transformation of
the Health System in South Africa to improve health through achieving a new
mission, goals and objectives for the health sector. In terms of the White Paper, in
future the national health system should aim to provide “caring and effective
86
services through a primary health care approach”. The Paper found that the main
challenge was to establish an integrated health system and an effective referral
system between the different levels of care. The objective is to ensure that most
people enter the health system at the primary care level, where they receive
basic care and health education, and that more complicated health care services are
dealt with by district and specialist hospitals.
6.6.2 The Taylor Committee Report on South Africa’s health care

system
The Taylor Committee was appointed in 2002 to look at ways of making the overall
social security system in South Africa more inclusive. Their main recommendations
with respect to health care provisions included the following:
● Government is primarily responsible for the health care system which should
be funded from tax revenue. There is, however, a need for the private sector
to be involved.
● The private health sector must be regulated by the state.
● The public health care system must maintain its role as the centre of the over-
all health system.
● The public health care system must maintain its important role as a tertiary
training ground for health personnel.
● A basic minimum group of essential benefits must be provided in the public
and private sectors, a risk structure should be explored, and three types were
suggested, namely:
– A universal benefit has to be made available to everyone – this would be
funded from a health care fund subsidised from taxes
– The present medical aid system must remain in place – this would imply
that since levies would increase, only high earners would be able to afford
the costs involved. Membership would be voluntary, and people could be-
long to such schemes if they choose to do so.
– A state-sponsored medical scheme for low-income earners – this would
likely be used by the informal sector or middle-income earners wishing to
opt for more cost-effective cover.
6.6.3 The National Health Insurance

The most important reform in the health care provision so far has been the
introduction of the National Health Insurance (NHI). The NHI will be
phased in over a period of 14 years starting from 2012. It started as a pilot project
in ten selected districts which were chosen based on the results of an audit of all
public health facilities in South Africa.
The first five years included pilot studies and the strengthening of the health
system in the following areas: management of health facilities, infrastructure
development, medical devices/equipment, human resources planning, development
and management, information management and support systems, and the
establishment of the NHI Fund. The NHI will improve health service provision
and health care delivery in this country. It will also make sure that all the people
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have access to affordable and quality health services regardless of their employment
status. The NHI does not do away with private medical schemes. People may still
use medical schemes, but the schemes will be required to satisfy certain
requirements.
The NHI will be a compulsory scheme and all South Africans will be required to
participate in the scheme. It will be financed through levies or tax deducted
from the salaries of those who are employed in the formal sector and paid by
the state on behalf of the unemployed. The overall implementation of the NHI
is premised on the idea that all South Africans, irrespective of their economic
position, are entitled to access health care services. In terms of this ideology,
government is obliged to take reasonable legislative and other measures, within its
available resources, to achieve the progressive realisation of the right.
It is envisaged that the NHI will be governed by a board of trustees to be created
by legislation. It will make available only a prescribed set of benefits from a
prescribed but legally accredited set of health care providers – including doctors
and hospitals at a cost negotiated between the state and health care providers.
ACTIVITY 6.4
How has the South African government attempted to address the shortcomings found
in the country’s health care system?
Your answer should take into account the objectives of the White Paper for the Transfor-
mation of the Health System in South Africa, the recommendations of the Taylor Com-
mittee and the introduction of the National Health Insurance (NHI).
(6.1) Describe how the Constitution of the Republic of South Africa provides for the right
to health care services.
(6.2) Describe the nature of South Africa’s present health care system.
(6.3) Describe the shortcomings found in South Africa’s present health care system.
(6.4) Describe public health care.
(6.5) Describe private health care.
(6.6) Explain how private health care is financed.
(6.7) What are the main objectives of the National Health Insurance (NHI)?
(6.8) What were the main recommendations of the Taylor Committee regarding South
Africa’s health care system?
(6.9) Describe the objectives of the National Health Act of 2003.
(6.10) Explain how the right to have access to health care can be limited.
6.7 CONCLUSION
There is still a long way to go before equality and accessibility for all can be
achieved in health care delivery. Government has realised the need for change and
a number of reform initiatives have been taken to work towards the idea of a more
effective, accessible and high-quality health care system through, among others, the
introduction of the NHI.
88
Now that you have completed this learning unit, you should be able to understand the cur-
rent nature of South Africa’s health care system, grasp the constitutional provisions on
health care, and appreciate the nature of challenges that characterise the system cur-
rently and the reform initiatives that are underway.
In the next learning unit, we look at informal and indirect social security.
6.8 GLOSSARY
Insurance An arrangement by which a company or the state under-
takes to provide a guarantee of compensation for specified
loss, damage, illness, or death in return for payment of a
specified premium.
Health care The organised provision of medical care to individuals or a
community.
Medical scheme It helps one to pay for healthcare needs (such as surgery,
dental work, medicine, hospital services) in order to have
medical cover.
Reform To make changes to something (eg, policies or practices) in
order to improve it.
Tax revenue Income that is gained by government through taxation.
Priority The fact of being regarded or treated as more important
than others.
Effective Being successful in producing desired results.
Inferior To be lower in status or quality.
Compulsory Required by law or rule.
System A set of things working together as part of a mechanism (eg,
a structure, an organisation, a network).
Shortcomings A fault or failure to meet a certain standard, typically in a
person’s character, a plan or a system.
Contributory Payment of money into a fund to receive protection from
certain social risks.
Beneficiaries A person who derives advantage from something, for exam-
ple, a social assistance programme or insurance fund.
Public For the use of or concerning the nation as a whole.
Private For the use of chosen people or of one particular person.
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ACTIVITY 6.5
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● explain how the Constitution provides for the right to health care in South
Africa
● describe South Africa’s public health system
● describe South Africa’s private health care system
● describe the challenges facing the health system in South Africa
● explain the objectives of the National Health Insurance (NHI)
90
Learning unit 7
Informal and indirect social security
Learningunit7
Contents
7.1 INTRODUCTION 92
7.2 INFORMAL SOCIAL SECURITY AND ITS ROLE 93
7.3 SHORTCOMINGS OF INFORMAL SOCIAL SECURITY 94
7.4 THE NEED FOR BETTER COOPERATION BETWEEN FORMAL AND
INFORMAL SOCIAL SECURITY 96
7.5 THE CONCEPT OF INDIRECT SOCIAL SECURITY 97
7.6 FORMS OF INDIRECT SOCIAL SECURITY 97
7.6.1 Environment 97
7.6.2 Land 98
7.6.2.1 Land Restitution Programme 98
7.6.2.2 Land Redistribution Programme 98
7.6.2.3 Land Tenure Reform 98
7.6.3 Housing 99
7.6.4 Food and nutrition 99
7.6.5 Water and sanitation 99
7.6.6 Education 100
7.6.7 Transport 100
7.6.8 Energy 100
7.6.9 Communication 101
7.6.10 Employment initiatives 101
7.7 CONCLUSION 102
7.8 GLOSSARY 102
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LEARNING UNIT 7: INFORMAL AND INDIRECT SOCIAL SECURITY
This learning unit introduces you to informal and indirect social security and the
different forms they can take. It provides a description of the concepts of informal
and indirect social security, the role they play, the shortcomings of informal social
security, and the necessity for cooperation between formal and informal social
security. The discussion of indirect social security in this learning unit is, however,
limited to its description and the different forms it takes.

● describe informal and indirect social security
● explain how informal and indirect social security fit into South Africa’s social security
system
● describe the role played by informal and indirect social security
● describe the shortcomings of informal social security
● identify different forms of informal and indirect social security
● discuss how better cooperation can be achieved between formal and informal social
security
7.1 INTRODUCTION
Apart from formal social security measures which take the form of social
assistance and social insurance, there are other social security measures that come
in the form of informal and indirect measures.
The legacy of apartheid has led to a formal system which provides social security
mainly to people in formal employment to the exclusion of people employed in
the informal sector or in informal employment. Mainly white people were
covered by apartheid policies which ensured job reservations for them. As a result,
the needs of African people were not considered, and this led to the development
of two safety nets, namely a formal and informal social security system. Informal
social security continued to grow, and this resulted in the dual system of social
security which currently exists in South Africa. It can be accepted, however, that
the formal and informal social security have the same objective as they are
both intended to reduce poverty and inequality.
Even though informal social security has existed for a long time, it is only now that
it is starting to be recognised in South Africa (though not yet formally recognised)
as a separate strand of social security. It has also become important to recognise
the informal system due to the constitutional guarantee of the right to have access
to social security given to everyone in this country.
Consequently, the South African social security system must not only address past
discrimination and exclusions, but also be reformed in such a way that it will be
more effective and inclusive. This is in line with the guarantee given to everyone
in section 27(1) of access to social security and state obligations in section 27(2) to
achieve progressive realisation of the right to have access to social security.
92
Indirect social security, on the other hand, refers to forms of social security
which are not part of direct or traditional social security measures. There is a close
link between direct and indirect social security as without indirect social security,
direct social security will be meaningless. Indirect social security, like direct social
security, prevents damage or hardship and enables people to live a dignified life.
Indirect social security also finds its roots in the Constitution (the Bill of Rights).
It should be noted that the right to dignity, as enshrined in the Bill of Rights, can be real-
ised through indirect social security rights.
These rights include the right to a healthy environment, land, adequate housing and
shelter, food and nutrition, water, education, energy, communication and transport.
7.2 INFORMAL SOCIAL SECURITY AND ITS ROLE

There is no uniform definition of the concept “informal social security” as there is
also no fixed definition of the term “social security”. Informal social security
includes social protection mechanisms outside the formal social security framework.
It does not have characteristics associated with formal social security such as state
regulation and legislative framework governing the creation of such schemes,
participation, and the rights and obligations of participants/beneficiaries.
However, informal social security should not be seen as a concept separate from
formal social security. It is for this reason that the definition of social security
needs to be broadened to provide for all social security strands, namely
formal, informal and indirect social security.
Informal social security developed when those who were excluded from the formal
system, developed other mechanisms to provide protection against certain social
risks. Its development can also be linked to the problem of poverty.
Informal social security mainly takes the form of kinship-based support.
Kinship-based social security is where blood relatives and other members of a household
or extended family support one another.
This can take the form of services in kind or monetary transfers. It is based on a
relationship of kinship-based arrangements and depends mainly on the principle of
reciprocity and ubuntu. Through this form of support, families are able to provide
support to members of the family who are not in a position to provide for
themselves, for example, children, the elderly, the disabled, and the sick.
Kinship-based support has developed into mutuality which takes the form of
neighbourhood-based or community-based forms of support.
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Neighbourhood-based social security comprises collective social security measures and

may take different forms, including mutual saving schemes, revolving credit associations,
burial societies and stokvels.
Contributions or support can consist of money or services or even both. Many

individuals and families rely on both formal social security and informal social
security.
Informal social security is based on the elements of solidarity, reciprocity and trust.
For those who are not covered by formal social security, a basic level of subsistence
is provided through a steady network of social relations, and access to or
participation in these arrangements is also organised along the lines of social
relations.
Other reasons for reliance on informal social security include the following:
● The present formal system excludes and marginalises many poor people who
are not employed or who are employed in the informal sector.
● Marginalised and impoverished people, mostly women in this country, are pre-
dominantly rural based and excluded from existing formal social insurances
arrangements.
● African people, especially in rural communities, have a strong sense of the
functioning of their families and communities. Informal social security is a
way of life for them – as informal networks demonstrate their values of ubuntu
and their culture.
● People are forced by poverty to rely on informal arrangements for survival.
ACTIVITY 7.1
Read the following scenario and answer the question. You have been requested to
address the Minister of Social Development on the importance of informal social
security in South Africa’s social security system. What do you regard as the main role
played by the informal system?
The role played by informal social security is very important and includes providing cov-
er or support for those members of the community who are excluded from the current
formal system. Are you in a position to mention other roles played by informal social se-
curity? If not, study paragraph 7.2 again to remind yourself of the role of informal social
security.
7.3 SHORTCOMINGS OF INFORMAL SOCIAL SECURITY

Even though informal social security plays an important role in South Africa’s
social security system, it must be accepted that it has some limitations. Informal
social security cannot indefinitely sustain those excluded from formal social
security protection. For example, such social security arrangements often lose
their effectiveness when families are disintegrated, for example, when people move
from their rural homes to urban areas in search of jobs and a better life. Owing to
urbanisation, the number of people among which the social security risk can be
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spread, is considerably reduced. Therefore, informal social security arrangements

on their own cannot provide adequate protection to people participating in such
arrangements. Informal social security mostly provides low benefits because it is
generally used in a poor environment where benefits are either uncertain or low.
Social protection with respect to informal social security arrangements is difficult
to sustain, even more so in the face of large-scale disasters and epidemics such as
HIV/AIDS. Participation in such schemes also comes with its own burdens and
responsibilities. Time spent organising and holding meetings means that less time is
spent on activities that could contribute to the income of the scheme. The
decision-making of the scheme is left in the hands of a small group of active
members. The most vulnerable members of the scheme are mostly the victims of
any change in or failure of the scheme. The system is also characterised by poor
administration. Some of the schemes are characterised by corruption, poor
financial management and poor record keeping.
ACTIVITY 7.2
Would you say that informal social security is the best and only solution for those
people who are not covered by the formal social security system? Substantiate your
answer.
No, it is definitely not. It should be accepted that even though informal social security
plays an important role in South Africa’s social security system, it has some serious limi-
tations and shortcomings. These shortcomings are discussed in paragraph 7.3 above.
ACTIVITY 7.3
Write in point form the important role played by informal social security in South Africa’s
social security system.
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ACTIVITY 7.4
Write in point form the weaknesses of the informal social security system.
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7.4 THE NEED FOR BETTER COOPERATION BETWEEN FORMAL

AND INFORMAL SOCIAL SECURITY
There is a need for cooperation between formal and informal social security
because South Africa’s current social security system has many shortcomings.
Continuous growth in informal social security calls for the recognition of the
system and, eventually, the reform of the present system. The present system
excludes the majority of the people in need of protection. A holistic view of social
security is necessary in order to bring about cooperation between these two
systems. Although the informal system is not necessarily an equal alternative to a
formal system, it could provide a link with people at grassroots level. It does have
the potential to provide social protection at a microlevel. Government should
therefore develop policy that will encourage and support the role played by
informal social security. Social security policies should promote and improve the
capacity of informal social security. Legislation must keep the formalities simple
because many of the participants are illiterate. Participation must be affordable, and
benefits must be adequately protected.
Certain risks can be covered by both formal and informal social security measures
and others can be covered by formal measures only. The nature of the risk will
determine the appropriateness of the measure to be applied. Proper access to
funding from financial institutions by informal social security schemes is needed to
improve their viability.
Existing informal social security schemes which are properly constituted and
managed can be encouraged to expand their activities to cover people who do not
belong to the modern social insurance schemes. The linkages between formal and
informal social security will strengthen and extend the social security safety net to
those who have who have inadequate cover or no cover at all.
It is not possible to expand the formal system indefinitely due to the structuring of
the system and economic constraints. Government should look at other innovative
ways in which to extend the protective scope of the country’s social security system.
One of these innovative approaches can relate to informal social security. There is,
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therefore, a need to strengthen informal social security in order to provide

protection to more people.
ACTIVITY 7.5
Explain how you think formal social security and informal social security can work
together.
The Constitution of the Republic of South Africa 1996 guarantees everyone the right to
have access to social security and yet that is not the case since many people are still
excluded from the formal social security system. On the other hand, informal social se-
curity continues to play an important role in protecting those who are not protected
under the formal system. A holistic view of social security will ensure that informal social
security is recognised and that legislative measures are developed for its administration
and regulation. This move will assist in extending protection to more people.
7.5 THE CONCEPT OF INDIRECT SOCIAL SECURITY

Indirect social security refers to services that are not part of direct social security but are
nonetheless important in preventing human damage and assist people to live a better life.
The administration of indirect social security is spread among various government

departments and several other public and private institutions. Indirect social
security measures and/or services are based on need (focused at, in particular, the
poor) and have a broad scope of coverage.
Thus, indirect social security measures must be well targeted and prioritised to cater
for the needs of people. Indirect social security is financed through government
general revenue generated from taxes and grants (donations made by international
donor organisations).
Direct and indirect social security are inseparable and co-exist. For example,
the provision of free health care services to pregnant women and children will
remain a dream if there is no access to clean water to prevent these people away
from consuming cholera-infested water; regular, safe and accessible transport to
take these people to health care centres; housing and shelter; and food and
nutrition to keep them healthy. The social security contingencies which are not
covered under direct social security include environment, land, housing, food and
nutrition, water and sanitation, education, transport, energy, and communications.
These contingencies are briefly discussed below:
7.6 FORMS OF INDIRECT SOCIAL SECURITY

7.6.1 Environment
Section 24 of the Constitution provides that everyone has the right to an
environment that is not harmful to their health or well-being. This right is
crucial in every social security system mainly because the environment should be
preserved for not only the present generation but also for future generations. It
should be noted that all human beings depend on the environment in which they
live. Thus, a safe, clean, healthy and sustainable environment plays a crucial role in
the full enjoyment of a wide range of human rights, including the rights to food,
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health, water and sanitation. Without a healthy environment, people might not be
able to live at a level required for a minimum standard of dignity.
7.6.2 Land
Section 25 of the Constitution provides that no one may be deprived of property
(including land) except in terms of the law of general application and further
that no law may permit arbitrary deprivation of property. The section also
obliges the state to take reasonable legislative and other measures, within its
available resources, to foster conditions which enable citizens to gain access to land
on an equitable basis. Racially biased land policies, which were applied in the
colonial and apartheid era, restricted non-whites’ rights to access land. Section 25
starts by prohibiting any arbitrary deprivation of property, except where such
deprivation is permitted by the law of general application.
Expropriation of property is permitted under certain circumstances including
where it is for a public purpose or in the public interest, and subject to
compensation. Several measures have been introduced for purposes of addressing
the needs of the landless, namely land restitution, land redistribution and land
tenure reform. These measures are briefly discussed below.
7.6.2.1 Land Restitution Programme

Government’s objective with land restitution is to compensate individuals who
were forcefully removed from their land. Restitution is rights based, and the law
provides for either the restoration of land rights or cash compensation to the
victims of forced removals. This is to reverse the legacy of the 1913 Natives Land
Act which brought about forced removals and the eviction of Africans from their
ancestral lands.
7.6.2.2 Land Redistribution Programme

This is the most important component of land reform in South Africa. Initially
land was bought from owners by government and redistributed. This is what is
generally known as the ‘willing seller, willing buyer’ principle. This programme
has proven to be very difficult to implement in South Africa as the majority of
South Africans continue to be landless or without secure land rights.
7.6.2.3 Land Tenure Reform

Tenure reform, which makes provision for secure tenure and the prevention of
arbitrary and unfair evictions, refers to “changes in the terms of and conditions
under which land is held, used and transacted”. It is a system that
recognises people’s right to own land and to have control of the land. Its
objectives are to address the state of land administration in the communal areas of
former homelands and coloured reserves, and to strengthen the security of tenure
of farm dwellers living on commercial farms. Tenure security is addressed in
section 25(6) of the Constitution which states that –
A person or community whose tenure of land is legally insecure as a result of
past racially discriminatory laws or practices is entitled, to the extent provided
98
by an Act of Parliament, either to tenure which is legally secure or to compa-

rable redress.
7.6.3 Housing
The skewed access to housing and/or shelter in this country is a result of apartheid
laws and policies. Section 26(1) of the Bill of Rights guarantees everyone access to
adequate housing. On the other hand, section 26 (2) obliges the state to take
reasonable legislative and other measures, within its available resources, to achieve
the progressive realisation of this right. In addition, the Constitution provides every
child with the right to shelter. Accessibility to adequate housing means that the
state must create conducive conditions for all its citizens, irrespective of their
economic status, to access affordable housing. It should also be noted that section
26 (3) of the Constitution prohibits the eviction of people from their homes
and the demolition of their homes without a court order given after
considering all relevant factors. Important pieces of legislation in this regard are
the Prevention of Illegal Eviction from and Unlawful Occupation Act 19 of 1998,
and the Extension of Security of Tenure Act 62 of 1997. Several measures have
been introduced by the state to make housing accessible to the poor. They include
the following:
● Housing subsidies made available through the Housing Subsidy Scheme

● People’s Housing Process which provides adequate housing to people earning
less than R3 500 per month, and it is intended for urban and rural poor
families
● Rental Housing Policy Framework which establishes the government assisted
Rental Housing Subsidy Programme
● Human Settlement Capacity Grant which aims to develop capacity in munici-
palities and metros
7.6.4 Food and nutrition

Food in this context refers to a proper, well-balanced diet containing, among
other things, the required proteins, vitamins and carbohydrates that are
required for the proper functioning of the human body. A lack of food or food
security has adverse consequences for people’s health, social well-being and quality
of life. In terms of section 27(1)(b) of the Bill of Rights, every person has the right
to have access to food. In addition, section 28(3) gives children the right to basic
nutrition. In this regard, the Primary School Nutrition Programme is noteworthy as
it ensures that children enjoy the right to food and nutrition.
7.6.5 Water and sanitation

Access to water and sanitation is still limited in rural and semi-urban areas.
Every person has, in terms of the Constitution (section 27 (1) (b)), the right of
access to water. This right can, however, be limited in terms section 36 of the
Constitution. Access to water and sanitation protects health and human
dignity. For example, the poor disposal of human waste results in a hazardous
environment. The following measures directed at making water accessible to those
in need are noteworthy:
SSL2601/1 99
● free basic water: poor households receive a basic level of water supply free of
charge
● Community Water Supply and Sanitation Programme: this programme en-
sures that people living in rural areas have access to sufficient water and a
healthy living environment
7.6.6 Education
Section 29 of the Constitution gives everyone the right to basic education,
including adult basic education; and (b) to further education, which the state
must make progressively available and accessible through reasonable
measures. Thus, the Constitution acknowledges that education is a right and not
a privilege. The purpose of education is to equip everyone with knowledge and
the ability to realise their human potential and to participate socially and
economically in their society. In addition, every person has the right to receive
education in the official language or languages of their choice in public education
institutions where that education is reasonably practicable.
The following are some of the measures aimed at the progressive realisation of the
right to education:
free basic education, adult basic education and training, and the National Student
Financial Aid Scheme (NSFAS). The latter is a financial-aid scheme that grants
loans and bursaries to needy students at public higher education institutions in
South Africa.
7.6.7 Transport
Access to safe, affordable, reliable and frequent transport or rather the lack
of such access for many South Africans (in particular those in rural areas,
disabled passengers and passengers with special needs) is a source of great
concern. The national transport survey has revealed that a higher percentage of
the population is not able to afford high transport costs, and this limits their access
to transport and therefore to social and economic opportunities.
The Rural Transport Strategy is intended to contribute to the formulation of the
National Planning Guidelines for rural district municipalities’ public transport
network plans. Other initiatives with regard to access to transport include Scholar
Transport – to provide a framework for safe and secure transport for learners –
and Bus Rapid Transport (BRT) – intended to move large numbers of people to all
parts of cities quickly and safely.
7.6.8 Energy
In order to address the problem of lack of access to energy, government has made
public the intention to provide free basic electricity to the poor. Electricity has
become an integral part of every person’s daily life and it makes living more
efficient. Section 2 of the National Energy Act 34 of 2008 provides that one of its
objects is to ensure an uninterrupted supply of energy to the nation and to facilitate
energy access to improve the quality of life of the people of South Africa. On the
100
other hand, section 5(1) of the Act gives the Minister the duty to adopt measures
that provide for universal access to appropriate forms of energy to citizens at an
affordable price subject to, among other things, the availability of energy resources
and affordability of those resources.
7.6.9 Communication
Access to the telecommunications network and the public media is essential to
the realisation of a healthy, informed and integrated population. For example,
without access to telephones, access to emergency medical services will remain a
dream to many.
7.6.10 Employment initiatives

The main programme in this regard is the Expanded Public Works Programme
(EPWP). The EPWP is one of government’s initiatives to bridge the gap
between the growing economy and the large numbers of unskilled and
unemployed people. The EPWP involves creating temporary work opportunities
for the unemployed using public sector expenditure. It builds on existing best-
practice government infrastructure and social programmes either by deepening
their labour absorption or extending them.
Given that most of the unemployed are unskilled, the emphasis is on relatively
unskilled work opportunities. All of the work opportunities generated by the
EPWP are therefore combined with training, education or skills development with
the aim of increasing the ability of people to earn an income once they leave the
programme. Together with the SETAs, the Department of Labour (DOL)
coordinates the training and skills development aspects of the programme. Other
employment initiatives include:
● The New Growth Path (NGP): aimed at enhancing growth, employment cre-
ation and equity
● Working for water: to eradicate invasive alien vegetation to conserve water
and the environment
● Working on fire: focused on integrated fire management and veld and wild
fire fighting
● Working for Wetlands: use wetland rehabilitation for job creation
SELF ASSESSMENT QUESTIONS

(7.1) Describe informal social security.
(7.2) Describe kinship-based social security.
(7.3) Describe neighbourhood-based social security.
(7.4) What role does government play in support of informal and indirect social security?
(7.5) Explain how formal and informal social security can work together.
(7.6) Discuss the shortcomings of an informal social security system.
(7.7) Explain how informal social security has developed in South Africa.
(7.8) Explain if there are other forms of social security apart from formal social security.
(7.9) Give examples of kinship-based and neighbourhood-based arrangements.
(7.10) Identify and describe various forms of indirect social security.
SSL2601/1 101
7.7 CONCLUSION
Informal social security is as important as formal social security for they are both
aimed at addressing the problem of poverty and inequality in South Africa. The
recognition of informal social security as part of social security will definitely
extend the protective scope of the current social security system to categories of
people who are currently excluded. Recognition and regulation of informal social
security arrangements will go a long way in providing people, especially those in
the informal sector and those earning low salaries, with a savings vehicle which is
not only well regulated but also sustainable. It should be accepted, however, that
informal arrangements cannot serve as a stand-alone or independent source of
protection since they are unsustainable and don’t provide long-term solutions to
the needs of the people. Moreover, indirect social security also plays an important
role in poverty alleviation. Direct and indirect social security are inseparable and
should co-exist because government cannot address direct social security while
neglecting indirect social security. The right to indirect social security is as much a
human right as the right to direct or formal social security. Indirect and informal
social security are crucial components of any social security system.
Now you should be able to understand and appreciate the roles played by informal and in-
direct social security in South Africa. You should also be able to identify different forms of
informal and indirect social security and determine if these two forms of social security
can work together with the formal social security.
7.8 GLOSSARY
Social security Monetary assistance from the state for people with inadequate
or no income.
Security The state of being free from a threat or harm.
Formal Something that is officially sanctioned or recognised.
Informal To have a relaxed or unofficial style, manner or nature.
System A set of principles or procedures according to which some-
thing is done; an organised scheme or method.
Shortcomings A fault or failure to meet a certain standard, typically in a per-
son’s character, in a plan or a system.
Kinship Blood relationship.
Arrangements Plans and preparatory measures to make something happen
or possible.
Safety net A safeguard against possible hardship or adversity.
Collective Done by people acting as a group.
Measures A plan or course of action taken to achieve a particular
purpose.
Principle A basic idea or rule that explains or controls how something
happens.
Alleviate To make (suffering, a problem) less severe.
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ACTIVITY 7.6
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● describe informal and indirect social security
● explain how informal and indirect social security fit into South Africa’s social security
system
● describe the role played by informal and indirect social security
● describe the shortcomings of informal social security
● identify different forms of informal and indirect social security
● discuss how better cooperation can be achieved between formal and informal social
security
SSL2601/1 103
Bibliography
1. Olivier et al Social Security: A Legal Analysis 1ed 2003 (Durban: LexisNexis Butterworths)
2. Olivier et al Introduction to Social Security 2004 (Durban: LexisNexis Butterworths)
3. Strydom et al Essential Social Security Law 2ed 2006 (Cape Town: Juta & Co Ltd)
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0.2 LEARNING UNITS

Learning unit 4: Social insurance

0.3 PURPOSE OF THE MODULE

0.4 OVERALL OUTCOMES OF THE MODULE

0.5 THE STRUCTURE OF EACH LEARNING UNIT

The time required for doing a learning unit or an activity.

Consider or think about the concept.

Write some notes.

Learning unit 0 provided a foundational overview of the module. Learning unit 1

Students should take approximately 5 hours to work on this learning unit.

After studying this learning unit, you should be able to:

1.2 THE DEFINITION OF SOCIAL SECURITY

on various contingencies and on the benefits which must be provided in respect of

The Convention compels each ratifying country to establish a minimum of three

1.3 THE OBJECTIVE OF SOCIAL SECURITY

1.4 THE HISTORICAL DEVELOPMENT OF SOCIAL SECURITY IN

1.5 THE NATURE OF SOUTH AFRICA’S SOCIAL SECURITY

1.6 SHORTCOMINGS IN SOUTH AFRICA’S SOCIAL SECURITY

It can therefore be said that the system follows a risk-based approach.

1.7 THE ROLE OF INTERNATIONAL LAW ON THE

The ILO Conventions are therefore designed to ensure minimum coverage.

1.8 THE ADMINISTRATION OF SOCIAL SECURITY IN SOUTH

1.9 THE FINANCING OF SOCIAL SECURITY IN SOUTH AFRICA

1.10 ENFORCEMENT OF THE RIGHT TO SOCIAL SECURITY

In Learning unit 2, we will look at the constitutional provisions on the right of

Write a brief overview of Learning unit 1.

1.13 OUTCOMES ACHIEVED

After studying this learning unit, you should be able to:

Section 27 provides as follows:

(1) Everyone has the right to have access to –

2.2 THE SUPREMACY OF THE CONSTITUTION

2.3 OBLIGATIONS ARISING FROM THE CONSTITUTION

2.4 THE SCOPE OF EVERYONE’S RIGHT TO HAVE ACCESS TO

2.4.2 “Everyone’s” right to have access to social security

2.4.3 The “right to have access to”

2.4.4 “Including if they are “unable” to support themselves and give

● “Everyone” includes non-citizens with permanent residence. This is to ensure uni-

● “Appropriateness” means assistance that is sufficient, meets people’s basic subsis-

These aspects are discussed below.

2.4.5.1 Reasonable legislative and other measures

Write in point form the characteristics/elements of a state programme that is reasonable.

2.4.5.2 Within available resources

2.4.5.3 Progressive realisation

It necessitates the development of a realistic and comprehensive plan or

2.5 THE RIGHT TO EQUALITY IN RELATION TO THE RIGHT TO

2.6 DISCRIMINATION AND DIFFERENTIATION

Employees are usually subjected to differentiation for reasons that include

2.7 DIRECT AND INDIRECT DISCRIMINATION

This will amount to direct discrimination because of sexual orientation. Discrimination

2.8 GENERAL LIMITATION TO THE RIGHT TO HAVE ACCESS TO

2.9 ENFORCEMENT, ADJUDICATION AND MONITORING OF

Socio-economic It relates to the interaction of social and economic factors.

Write a brief overview of Learning unit 2.

2.12 OUTCOMES ACHIEVED

After studying this learning unit, you should be able to:

It is subject to qualifying criteria and is provided on a non-contributory basis.

3.2 GRANTS PAYABLE IN TERMS OF THE SOCIAL ASSISTANCE

3.2.2.2 Child support grant