Millions in income support for struggling ECD centres ‘stuck’ in provincial treasuries
Hundreds of millions in Covid-19 relief funds meant for early childhood development workers are stuck in provincial treasuries after the Department of Social Development missed its 31 March payment deadline. The provinces have now asked Treasury to have the funds released as more than 107,000 ECD workers across the country are struggling to make ends meet.
This story was edited post publication. Daily Maverick had previously stated that 33 533 employees had been paid by 16 April. This was not the case. It should have read: By 16 April National DSD had disbursed more than R140 million to provinces for payment to 33 533 employees. We apologise for the error.
Forty-year-old Bathabile Siphalane had given up hope she would receive the R4,186 income support promised to her by the government.
“We thought we just had bad luck,” she said.
Siphalane worked at an early childhood development (ECD) centre in Johannesburg and like many other employees, she was furloughed when ECD centres were ordered to close their doors in mid-March last year due to the coronavirus. She went without pay for six months.
“I’ve been struggling, because where I lived I was renting. My landlord was expecting rent each month and I ended up in debt. Even now I’m still owing the landlord.”
Despite returning to work in October, her salary was a fraction of what it was before. With the ECD centre accepting fewer children due to distancing protocols, there was less income and no subsidy from the government.
Saddled with debt, Siphalane, her husband (who lost his job) and three children were forced to move in with her parents who survive on pension grants. She was depending on the payout from the ECD Employment Stimulus Relief Fund to settle some of her debts.
Siphalane is one of approximately 107,000 ECD workers across the country still waiting for relief funds after the national Department of Social Development missed its 31 March 2021 payment deadline.
R496-million was made available to the ECD sector through the Presidential Employment Stimulus Package as income support to workers who had been financially battered by the lockdown. A once-off payment of R4,186 was allocated to each worker who qualified.
The Department of Social Development approved 116,578 ECD workers for funding. But according to departmental spokesperson Lumka Oliphant, to date, only 9,051 employees have been paid out.
By 16 April National DSD had disbursed more than R140 million to provinces for payment to 33 533 employees.
Due to bureaucratic blunders, the payout process has ground to a halt.
By the department’s own admission, the 31 March payment deadline coincided with the end of the 2020/21 financial year, meaning any unspent funds would have to be returned to the National Treasury. For some reason, however, the funds are still stuck in provincial treasuries.
Neither Treasury nor the department confirmed how much was stuck in provincial treasuries, but calculations indicate that with 9,051 employees paid R4,186 each, more than R37,88-million has been paid, leaving just under R460-million that has not been disbursed to ECD workers who have waited close to two months for funding.
The Treasury says provinces have submitted rollover requests to allow funds to be distributed in the current financial year. It told Daily Maverick: “Engagements with provincial treasuries are expected to be concluded by Friday, so the information should be available by Monday, 31 May 2021.”
A reliable source within Treasury said the rollover requests will likely be approved and payout may resume in June.
“It is shocking how this money is stuck in bureaucracy,” said Eric Atmore, head of the Centre for Early Childhood Development (CECD) in Cape Town.
A statement put out by the department earlier this month shifted blame for the delays onto applicants who provided “incorrect” banking and staff details.
But Yusrah Ehrenreich, the centre’s social justice and advocacy manager, blames the department for implementing an “exclusionary” application process when it was well aware of the tight 31 March deadline.
To comply with the Public Finance Management Act, the department said it had to verify that:
- The ECD service exists;
- The staff employed have valid identity numbers; and
- The bank account that public funds are to be disbursed into for this fund is not a private bank account and is verified to exist in the name of the service making the application.
ECDs were initially given two weeks to apply in February, but the due date was extended due to multiple issues.
“So the actual process was only available online. And so it was impossible to complete for people who honestly didn’t have access to electricity and internet, which we argued was the ECD workers who would probably need the funds the most,” said Ehrenreich.
ECDs were forced to purchase data or use internet cafés to complete applications.
Yumna Allie, principal of Otters’ Creek Pre-Primary in Ottery and member of the Greater Grassy Park ECD Principals’ Forum, said several centres came together to assist one another but even those who were computer-literate struggled with the technical application process.
But Oliphant said ECD centres were assisted with the application process in numerous ways, including through a toll-free number and various organisations.
The requirement for a business bank account was a stumbling block given the ECD sector is largely informal.
Nadeema Connelly, principal of Tinee Tots Educare in Bonteheuwel, Cape Town, paid R500 to open a business bank account. “It took money from us,” said Connelly.
Walking on crutches
The sector was crippled by the lockdown and in Allie’s words, ECDs are “walking on crutches”.
“Many parents can’t afford the fees that we used to charge. We’ve been giving parents rebates. We’d rather take 50% of their fees than to have zero,” she said.
For Connelly, things are much worse. She is on the brink of closing her doors for good.
“I’ve been going around asking people to help me out since March because we were expecting this relief fund to come by the end of March. And then it came to the following month, but up until now, nothing has happened.”
Rent, fuel, personal protective equipment and food costs are some of the expenses Connelly is battling to keep up with.
She provides two meals for children at her centre which are often the only meal they will receive in a day.
Allie says some of the principals in her forum have given their own groceries to provide meals for children.
Many who were paid say they did not receive the full amount.
Oliphant said this was because of incorrect information discovered during the verification process. “Only payment was made to those employees who were found to be eligible after verification.”
ECD: the stepchild in education
Problems between the government and the ECD sector are nothing new.
According to Allie, ECD has been treated as the “stepchild in education”.
“We are marginalised, neglected, and not recognised,” said Allie. “There’s no support for ECD centres because most are unregistered. Because they’re unregistered there’s no regulation.
“With Covid, all those problems have been exposed. The sector is suffering, it is actually bleeding.”
Hundreds of ECD centres, in the Western Cape alone, have closed down in the aftermath of Covid-19.
“Which leaves those children vulnerable and exposed to paedophiles and child abusers. They are exposed to the gangsters and the violence on the streets,” said Allie.
The value of ECD centres is incalculable.
Sonja Giese from Innovation Edge, a company that provides funding to nonprofits in the childhood development space, said: “We know that children who have access to two years of a high quality early learning programme are more likely to start school on track. For children who don’t have access to these early learning programmes, it’s very difficult for them to catch up. Every month that ECD services remain closed, young children are missing out on important learning opportunities. If we don’t invest enough in ECD, we will not see the improvements we desperately need in education outcomes further down the line.”
Feeding programmes provided by ECDs also help combat South Africa’s dire stunting problem.
In the Western Cape, where R53-million of the stimulus fund was allocated, only R5,62-million has been paid.
The department appointed an intermediary organisation called the Foundation for Community Work (FCW), to assist with the processing of payments and verification of the stimulus relief package.
A press statement released by the Western Cape Department of Social Development on Thursday said 562 ECD sites (70%) from a total of 793 were processed. At least 3,159 applications were initially received. Joshua Chigome, spokesperson for the department, says 1,334 staff payments were processed, based on an initial 50% payment. The department is conducting verification to ensure money is being allocated to workers before the other half of the payment is made to ECDs.
In light of the low number of approved applications in the province, Minister Sharna Fernandez called on the national department to reopen applications for the ECD Stimulus Relief Fund.
In response to the call, Atmore said: “While we support Minister Fernandes’ call for national [department] to reopen applications for the ECD Stimulus Relief Fund, we are very disappointed that only 25% of applicants have been approved and that no reasons have been given for declining and for not approving applications.
“It’s also very disappointing that only 70% of the ECD sites that applied have been processed. What is holding up the remaining 30%? The government has now had two months to do the processing and they are clearly way behind schedule.”
“The impact is that ECD workers are in a dire situation; ECD centres are closing. ECD workers who are entitled to this stimulus package have been denied it and they are further exacerbating the poverty in the early childhood sector.”
A senior source in Treasury indicated that discussions are underway to add a further R200-million to the existing ECD relief fund. DM
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