/ 28 February 2017

Sassa asks Concourt to allow negotiations with CPS on grant payments

Sassa has approached the Concourt to authorise its engagement with CPS to provide services for another year.
Sassa has approached the Concourt to authorise its engagement with CPS to provide services for another year.

The South African Social Security Agency (Sassa) has asked the Constitutional Court to authorise its engagement with Cash Paymaster Services (CPS) for the payment of grants for the next year.

Sassa filed court papers to the Concourt on Tuesday afternoon saying they wanted to use CPS services from April 1 2017 to March 30 2018.

The social security agency approached the Concourt for an order “authorising Sassa to engage the respondent (‘CPS’) to provide services for the payment of social grants for the period 1 April 2017 to 30 March 2018”. 

In court papers, Sassa asks the Concourt to give it orders to file a report by October 1 2017 that will address:

  • Sassa’s “readiness to take over in full the payment of social grants”
  • The “projected time” in which Sassa will be ready to pay grants

In 2014, the Concourt found that Sassa’s existing contract with CPS is unlawful and invalid because due process was not followed when CPS was awarded the contract to provide its services.

Despite the Concourt ruling, Sassa continued to use CPS’s services to pay grants. Its contract with CPS expires on March 31 2017, and currently, the social security agency has said that negotiations with CPS remain their only option to pay grant on April 1 2017.

There are 17-million South Africans who rely on the grant system.

The Concourt filing comes after Sassa’s project manager for an internal grant payment system, Zodwa Mvulane, told Parliament’s public accounts committee on Tuesday that Sassa would not file an application asking the Concourt for permission for it to deal with Sassa.

In an affidavit also filed to the Concourt on Tuesday, Sassa says that if the Concourt does not grant the order, then “the majority of our poor people will have hardship in receiving payment of social grants”. In effect, Sassa has placed the responsibility of grant payments squarely at the feet of the court.

Sassa has also told the Concourt that it “has already commenced the process to issue a tender for the services of a cash service provider” in areas where the banks and Post Office are unable to facilitate. 

The banks and Post Office were some of the options Sassa considered when it began searching for a solution to the current crisis it is in. In the three years since the Concourt ruling, Sassa has not devised a plan to pay grants without the use of CPS’ services. 

The social security agency initially committed to file papers in the Concourt on February 8 to extend its invalid contract with CPS. Mvulane said on Tuesday in Parliament however that Sassa was now seeking a new contract with CPS rather than an extension of the existing contract.

Social Development Minister Bathabile Dlamini has said that grants will be paid on April 1, but Sassa has not yet secured a payment method to deliver grants.

Notice of Motion 

Founding affidavit