​Wanted: Software, hardware and 60 000 staff to pay social security grants

The South African Social Security Agency (Sassa) owns no part of the platform used to pay 17-million beneficiaries their government grants, it said last week. Besides putting in place all that infrastructure, replicating the system could require hiring nearly 60 000 people.

After two delays, Sassa on Friday released answers to questions put to it by potential bidders, who hope to get a piece of the action when a new grant payment system is put in place. That system is due to go live on April 1.

Though scant on detail, the answers provide the first information Sassa has released on its state of readiness for that deadline, after months of determined silence.

Sassa owns only the data of the beneficiaries it must pay, including biometrics used to identify them.

“All software, hardware and related IP [intellectual property] used to provide the service belongs to the service provider,” it said.


The service provider is Cash Paymaster Services (CPS). Its contract — to make what amounted to R128-billion in payments in the past financial year — was declared invalid by the Constitutional Court in 2014.

The invalid CPS contract ends on March 31, and there is no known legal method to extend it.

Sassa was ordered to find a new service provider. It failed to do so and said it would instead “insource” (take on) the function.

Instead of insourcing the payments, Sassa then issued a request for information that would help it to put together tenders for the individual components of the CPS contract, giving it an ecosystem of providers that Sassa would manage, rather than a single outsourced provider.

But to replace the entire CPS system, Sassa said, its new ecosystem of providers would need to manufacture and distribute 12-million payment cards, and be ready to issue about 150 000 more every month — new and replacement cards.

Some grant recipients access their payments via their own bank accounts.

Asked whether CPS would be obliged to co-operate with new providers to ensure a smooth transition, Sassa said only that “a phase-out agreement will be in place”.

Sassa would not comment at all on whether current CPS employees could be approached by a new bidder, nor what the fate of these employees would be. Such “details may be provided in the forthcoming tender”, it said.

Sassa data show that the number of employees affected — and the number who may have to be hired by a new provider — comes to 59 502, based on the six people it says are required to staff each of its 9 917 pay points around the country.

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Phillip De Wet
Guest Author

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