proposals for reparations for victims of...

PROPOSALS FOR REPARATIONS FOR VICTIMS OF APARTHEID GROSS HUMAN RIGHTS VIOLATIONSKhulumani Presentation prepared for Workshop with Department of Justice

1

Although a number of initiatives have been implemented to respond to the needs of Apartheid victims of gross human rights violations, there are still significant gaps in this response

Globally accepted UN framework for reparations to victims of gross human rights violations

Satisfaction RehabilitationGuarantees of non-repetition

Restitution Compensation

TRC aimed to recognise the suffering of victims in a public platform

Various symbols and memorials have been developed (e.g. public holidays, names of places and streets, museums, etc.)

Many victims’ medical and psychosocial needs still need to be addressed, as many remain in desperate poverty and are unable to access basic services

The basic principles of the South African constitution aim to protect victims and all South Africans from future violations

Many victims continue to suffer from high levels of poverty and have been unable to make up for the lost opportunities they incurred as a result of the violations they experienced

The only financial compensation paid to victims (once off R30K payment) was well below the amount recommended by the TRC and other panels

Furthermore, it only reached a small portion of the complete universe of victims

Source: United Nations (framework)

The proposals presented today by Khulumani and partners aim to address the gaps in reparations for victims

2

Agenda

Individual financial grants to victims

Utilisation of the President’s Fund

Summary

3

An individual financial grant to victims will address their urgent needs for compensation and restitution




Empowerment of victims to uplift themselves and improve their

circumstancesFinancial

compensation to…

Acknowledge their suffering

Subsidise basic living costs

Enable access to services

and facilities

4

A financial grant would empower victims to address the areas in which they require assistance themselves, as outlined by the TRC

Medical needs (physical and psychosocial)

Other (exhumations, burials, legal, etc.)

Educational needs

Housing needs

Core needs of victims that need to be addressed

5

A financial grant has a number of benefits over other forms of compensation methods (e.g. service packages) in two key areas…

Impact on victims

Creates the opportunity for true empowerment of victims as victims become responsible for their own fates and can take charge of their own lives and those of their dependents

Victims are best placed to know their own needs and to prioritise those needs

Is less public than other methods of compensation, to avoid community tensions

Impact on victims can be directly measured via their use of the funds

Cost and efficiency

Low cost to administer – only significant administration costs relate to the upfront verification of victims and the research component of monitoring the impact of the grants on victims

Infrastructure to implement already exists (SASSA) and can be leveraged

Suggested fixed amount for all victims does not require laborious assessments to determine the severity of suffering by victims

Ease of fiscal management

Research by both the TRC and Khulumani has revealed that financial compensation is the preferred method of compensation by victims – it speaks directly to their needs

6

The R30K payout that some victims received was well below the amount recommended by the TRC – and this has been confirmed by extensive research by Khulumani with an expert panel

TRC beneficiaries Khulumani memberswho were not

TRC beneficiaries

Other victims Victimverification costs

Research costs* Total

1.5

7.00.5 0.0 0.0 9.1

0

2

4

6

8

R10B

Esti

mat

ed c

ost

of

ind

ivid

ual

gra

nt

for

vict

ims

Note:*Research costs are an estimate at this stageSource: Khulumani

17K TRC beneficiaries will receive a further

R90K

Remaining Khulumani members

(~59K) receive R120K

Victims not yet recorded (~5K) receive R120K

7 years of research to track impact (R1.3M

per year)

To verify ~80K victims

Khulumani and partners recommend a total grant of R120K per victim. To reach ~80K victims, and taking into account those who received the R30K TRC payout, implies ~R9B in grants

7

Additional factors to consider in the implementation of an individual financial grant for victims…

Grant to be paid over a period of five years on a monthly basis

Administration of grants to be managed by SASSA

R120K amount in line with TRC recommendations and based on extensive research conducted by Khulumani in 2003, as to what would satisfy victims’ needs – amount has not been adjusted for inflation, in order to remain conservative

Amount equates to R2K per month, which is largely in line with current minimum wages for basic workers (e.g. domestic workers, cashiers)

Financial requirements of grant to be funded from special dispensation from Treasury

Victims whose financial situation is already improved and therefore do not require grant support, to pay their grant allocation into a special fund to be used for community reparation activities (initial victim verification process to set thresholds in terms of identifying such individuals)

Source: www.mywage.co.za (for minimum wage amounts)

8

Agenda


Utilisation of the President’s Fund- Living Museum of the Struggle

- Psycho-social services

- Microfinance initiative

- On-going Khulumani funding

Summary

9

The four initiatives proposed for the use of the President’s Fund will cover a number of areas that still need to be addressed in terms of reparations to victims




1. Apartheid Living Museum in

Grahamstown

2. Provision of psychosocial services

to victims

3. Investing funds to offer micro-financing

services to victims

4. Investing funds in support of Khulumani’s activities, which provide services to victims that cover all areas of required reparations to victims (advocacy, psychosocial support, economic support, etc.)

10

A museum victims will address their urgent needs for compensation and restitution




The establishment of a Living Museum of the Struggle would

allows victims of Apartheid to feel not only that the struggle mattered,

but that THEIR struggle MATTERS

Mu

seu

m

11

It is estimated that an allocation of ~R40M would set the museum on a solid footing

5 years running costs

Set up costs

Building procurement

40

0

10

20

30

R40M

Co

st a

lloca

tio

n

Mu

seu

m

12

The Khulumani narrative workshops are aimed at psychological healing and skills development

Workshop itinerary

Narrative activity (2 day duration)

– Individual story telling

– Conversion of life stories into pictorial format for group sharing

– Outline of practical mechanisms for coping with past trauma

Skills development (3 day duration)

– Graphic design courses

– Screen printing workshop to develop saleable products

Sources: Khulumani website; stakeholder interview

Workshop goals

Narrative approach aims to bring about transformation through the re-interpretation of life stories

Issues are dealt with on an emotional, psychological and spiritual level

Time is given for individual reflection, creative exercises and opportunities to share in small groups

Practical skills are developed to enable financial independence

It is proposed that a lump sump investment from the President’s Fund is used to generate interest to fund ongoing narrative workshops

Psy

cho

-so

cial

13

The total cost of running narrative workshops will grow from R1,6 million to R2 million over a 5 year period

Nationalprogramme

manager

Traveland phone

Provincialfacilitators

Narrativeworkshops

2011F 2012F 2013F 2014F 2015F

1.61.7

1.81.9

2.0

0.0

0.5

1.0

1.5

2.0

R2.5M

An

nu

al c

ost

fo

r p

syco

-so

cial

wo

rksh

op

s

Inflation 5.4% 5.8% 5.6% 5.9% 5.8%

Note: inflation is calculated using an average of projections from leading institutionsSources: SARB; Nedbank; ABSA; FNB; Standard Bank

Assumptions

9 x provincial facilitators @ R3500/month

1 x national programme manager @ R17500/month

Monthly travel and phone allowance of R2000/person

30 x five day workshops per year

Workshop cost of R26000 including facilitator; travel, food and materials for 15 attendees

These narrative workshops will cater for ~450 people per year

Psy

cho

-so

cial

14

An initial lump sum of R31 million is required to generate sufficient interest to fund ongoing narrative workshops

Investment total

Interest rate

Interest received

Workshop expense

Interest for re-investment

2011

R 31,000,000

7.1%

R 2,208,750

R 1,608,000

R 600,750

2012

R 31,600,750

8.0%

R 2,528,060

R 1,701,264

R 826,796

2013

R 32,427,546

8.2%

R 2,648,250

R 1,796,535

R 851,715

2014

R 33,279,261

7.0%

R 2,329,548

R 1,901,931

R 427,617

2015

R 33,706,878

6.0%

R 2,022,413

R 2,011,293

R 11,120

Note: Interest and inflation are calculated using an average of projections from leading institutionsSources: SARB; Nedbank; ABSA; FNB; Standard Bank

Prime rate 11.1% 12.0% 12.2% 11.0% 10.0%

The interest rate is calculated at prime minus 4% but will be dependent on the type of investment

The additional interest generated is required for re-investment to offset the effects of inflation and fluctuating interest rates

Psy

cho

-so

cial

15

A dedicated microfinance fund for victims will directly address the urgent need for restitution




“Foremost, microfinance initiatives can effectively address material poverty, the physical deprivation of goods, services, and the income to

attain them. When properly guided, the material benefits of microfinancing can extend beyond the household into the community.

At the personal level, microfinance can effectively address issues associated with “non-material poverty, which includes social and

psychological effects that prevent people from realizing their potential.” United Nations

Mic

rofi

nan

ce

16

The solidarity\group lending structure has proven the most successful

PlaceholderLoan group

Loans are offered to groups of between five and eight members, who meet the organization's requirements.

– Know each other well

– Live close to one another

– Trust each other and believe in each other's business

Individual

Leverages group cohesiveness to achieve individual financial goals

Lender*

Loan sizes range from R500 to R10,000

Groups are tested for group coherence

Members are encouraged to assess each other's businesses to ensure they are legitimate and that they will make enough money to repay a loan

* Based on Marang Financial Services operating model

Mic

rofi

nan

ce

17

The success of current financiers (despite a low capital base) implies that microfinance is necessary, scalable and sustainable

Funding since inception

Disbursements since inception

Current loan book

Row

Cumulative experience

Marang Financial Services

R102M for on-lending

R24M grants

R700M

R35M

3 Major SA micro financers

45 yrs

Current numbers of clients 145,000

Operational self sufficiency ratio 117%

Source: Marang Financial Services

Average loan size R2,002

Financial self sufficiency ratio 108%

A capital injection from the Presidents Fund, would allow a greater number of people to be access finance, while ensuring the capital is adequately mantained

Mic

rofi

nan

ce

18

Khulumani is well positioned to guide the process of restoration for apartheid victims

Overview

Is the main destination of referral for apartheid victims and survivors

Has a database of ~65,000 members

Can provide detailed analysis of violations against members and their resultant needs

Is engaged with multiple communities to:

– Memorialise apartheid transgressions

– Provide psycho-social services

– Provide skills development

– Initiate community rehabilitation

Sources: Khulumani website; stakeholder interview

Mission

“To build an inclusive and just society in which the dignity of people harmed by apartheid is restored through the process of transforming victims into victors”

It is proposed that a lump sump investment from the President’s Fund is used to generate interest to fund Khulumani’s ongoing work

Kh

ulu

man

i

19

The total running costs of Khulumani will grow from R2,3 million to R2,9 million over a 5 year period

Headofficetelephone

Headofficerent

Provincialtraveland phone

Provincialstaff

Headofficestaff

2011F 2012F 2013F 2014F 2015F

2.32.5

2.62.8

2.9

0.0

0.5

1.0

1.5

2.0

2.5

R3.0M

An

nu

al c

ost

fo

r p

syco

-so

cial

wo

rksh

op

s

Inflation 5.4% 5.8% 5.6% 5.9% 5.8%

Note: inflation is calculated using an average of projections from leading institutionsSources: SARB; Nedbank; ABSA; FNB; Standard Bank

Assumptions

9 x provincial staff members with a salary cost of R8,000/person/month

Provincial travel and phone allowance of R2000/person/month

1 x national head office with salary costs of R90,000/month

Head office rental of R9500/month

Head office telephone rental of R6000/month

Kh

ulu

man

i

20

An initial lump sum of ~R45 million is required to generate sufficient interest to fund Khulumani for a period of 5 years

Investment total

Interest rate

Interest received

Khulumani expense

Interest for re-investment

2011

R 45,050,000

7.1%

R 3,209,813

R 2,346,000

R 863,813

2012

R 45,913,813

8.0%

R 3,673,105

R 2,482,068

R 1,191,037

2013

R 47,104,850

8.2%

R 3,846,896

R 2,621,064

R 1,225,832

2014

R 48,330,682

7.0%

R 3,383,148

R 2,774,833

R 608,315

2015

R 48,938,997

6.0%

R 2,936,340

R 2,934,386

R 1,954

Prime rate 11.1% 12.0% 12.2% 11.0% 10.0%

The interest rate is calculated at prime minus 4% but will be dependent on the type of investment

The additional interest generated is required for re-investment to offset the effects of inflation and fluctuating interest rates

Note: Interest and inflation are calculated using an average of projections from leading institutionsSources: SARB; Nedbank; ABSA; FNB; Standard Bank

Kh

ulu

man

i

21

Agenda


Utilisation of the President’s Fund

Summary

22

Apartheid museum

Psycho-social services

Khulumani running costs

Micro-financing

Individual financial grant

Cost

R40 million

R 31 million

~R45 million

Undetermined

R9.1B

Objective

Satisfaction:

– Publicly recognise the suffering of victims

– Ensure that the atrocities of apartheid are not forgotten

Rehabilitation:

– Help victims deal with the psychological effects of apartheid

– Develop practical skills that enable financial independence

Provide Khulumani with financial stability to enable ongoing work to support victims in addressing their needs

Restitution:

– Financially empower victims to address their most pressing needs

Compensation and restitution:

– Compensate victims in line with TRC recommendations

President’s fund

Special dispensation fund

Note: Costs pertaining to the Apartheid museum, psycho-social services and the running of Khulumani cover a 5 year periodSource: Khulumani

Summary of the initiatives proposed today…

Funding source

23

In addition, microfinance offers an opportunity to actively alleviate poverty in a sustainable manner

Credit facilities

Payment\ transfer facilities

Results

Enable taking advantage of profitable investment opportunities

Adoption of better technology

Enable expansion of microenterprises

Diversification of economic activities

Enable consumption smoothening

Promote risk taking

Reduce reliance on expensive informal sources

Enhance ability to face external shocks

Improve profitability of investments

Reduce distress selling of assets

Increase economic growth

Facilitate trade and investments

Impact

Higher income

More diversified income sources

Less volatile income

Less volatility in household consumption

Increase household consumption

Better education for children

Severity of poverty is reduced

Empowerment

Reduce social exclusion

Greater income

Higher consumption

Financial service

There is an opportunity to provide savings and insurance products, further increasing financial participation

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