Decline in social benefit pay-outs by public entities

Decline in social benefit pay-outs by public entities

South Africa’s 232 extra-budgetary accounts (EBAs) paid out less money in the form of social benefits in the 2014/15 fiscal year. Social benefits are transfers in cash or in-kind to the public that diminishes exposure to social risks such as unemployment, sickness due to disabilities and injury.


Social benefits paid by EBAs amounted to R32,6 billion in 2013/14, falling by 4,3% to R31,2 billion in the 2014/15 fiscal year, according to Stats SA’s latest Financial statistics of extra-budgetary accounts and funds report1. This is the first decline in social benefit spending by EBAs since 2011/12. This was mostly due to the Road Accident Fund and Compensation Fund recording a fall in benefit payments.


The Compensation Fund paid out less money in the form of benefits in 2014/15. According to their annual report, there was a slowdown in the number of claims finalised during the implentation process of a new online management system. The Compensation Fund provides compensation for disability, illness or death resulting from occupational diseases or injuries.


The fall in the number of claims finalised by the Road Accident Fund (RAF) was mainly the result of the Fund experiencing cash flow contraints. The Fund is responsible for compensating individuals injured in motor vehicle accidents, and the main source of income for the Fund is a levy raised on fuel.


There are two other EBAs responsible for providing social benefits:

  • Compensation Commissioner for Occupational Diseases in Mines and Work: responsible for the payment of benefits to workers and ex-workers from the mining industry, including those who are suffering from work-related diseases.
  • Unemployment Insurance Fund: responsible for providing short-term unemployment insurance to all workers who qualify for unemployment insurance and other related benefits.


The table below shows the change in social benefit pay-outs by all four relevant EBAs.


EBAs form part of the general government (the other levels of government being national, provincial and local government as well as higher education institutions), and they perform an integral role in delivering services to the public on behalf of the government. The National Lotteries Board, the Electoral Commission, and the Natal Sharks Board are other examples of EBAs.


1Download the report here.