POLICE in KwaZulu-Natal have arrested two government officials who allegedly siphoned off millions of rands of grants meant for the poor.

The two women, employed by the SA Social Security Agency and stationed at KwaMsane on the North Coast, were arrested on Sunday.

The arrests come after police investigations into cases of fraud, which have crippled government's initiative to dispatch grants to fight poverty in the area.

It is alleged the two officials enticed a number of people to fraudulently register for disability grants by pretending to be chronically ill.

The department has been defrauded of more than R4million. The fraud took place while legitimate applications were turned down.

One of the officials, whose name is known to Sowetan, is the wife of a local councillor.

It is also alleged the two officials built luxury houses with illegally obtained state cash.

Police spokesperson Colonel Vincent Mdunge said the officials had lured people to apply for grants for permanently disabled people and chronic illnesses.

"They allegedly processed the applications and channelled the payment to their personal accounts. The money never reached the people that applied."

Mdunge said the two women were expected to appear in court tomorrow on charges of fraud.

DA provincial social development spokesperson Makhosazana Mdlalose has called on MEC Meshack Radebe to "dig deeper" into the allegations.

"We do not believe that this is an isolated incident. It is highly unlikely that this sorry saga begins and ends with these two women and we suspect they are part of a much bigger picture."

Radebe said he welcomed the arrests. "These people had been stealing money meant for the poor and should be sent to jail."