/ 15 March 2017

Concourt weighs up extending an illegal social grant contract

Judge Selby Baqwa has told a crime conference that transformation of the judiciary is a human imperative in a constitutional democracy.
Judge Selby Baqwa has told a crime conference that transformation of the judiciary is a human imperative in a constitutional democracy.

Chief Justice Mogoeng Mogoeng listened as the Black Sash and Freedom Under Law (FUL) made their submissions, and one point was clear: if the court agreed to oversee the CPS deal, it may be supervising a contract that it declared invalid.

Senior counsel Geoff Budlender appeared before all 11 justices and began his submission with a bold, fatal opening.

“As we stand here today, no one knows who will pay grants in 16 days time,” Budlender said.

Outside the court, the Black Sash had formed a semi-circle around the the door leading into the building. One of their posters demanded: “No to unlawful #Sassa contracts”.

But even the Black Sash has said that a South Africa Social Security Agency (Sassa) contract with CPS is necessary for grants to be paid. Without Cash Paymaster Service (CPS), there’s a chance that there will be no grants. But with CPS, there is possibility that the Concourt and the executive will have to condone an unlawful agreement.

Social Development Minister Bathabile Dlamini’s assurance that grants will be paid on April 1 – a confidence that was echoed by President Jacob Zuma himself – blew to dust last night. Serge Belamant, CPS director, announced yesterday that if CPS does not secure a contract with the state today, then grant payments will be interrupted. Belamant said CPS needs time to iron out logistics before grants can be paid.

In court this morning, Budlender stressed the severity of the situation the beneficiaries are now in – and he held Sassa and Dlamini to blame for the crisis.

“I want to say, and I say this not lightly, everyone who is not anxious about the situation the minister and Sassa has created, is simply not paying attention,” he said.

The Concourt has found itself in a difficult position. Both Black Sash and FUL are asking the court to reinstate its oversight over grant payments. But, throughout the submissions, at least one of the justices would interrupt to ask about the possibility of extending a CPS contract that the court has declared invalid.

At one point Mogoeng asked Budlender directly: “Are you asking us to extend the life of a contract we declared invalid?”.

Budlender’s answer was no – the Black Sash is unclear if the Concourt has the power to authorise an extension of the contract or even the conclusion of a new contract. Instead, the Black Sash is asking the court to oversee the agreement CPS and Sassa will come to, and the implementation of that agreement.

If the Concourt agrees, then the highest court in South Africa will be in a position where it is supervising a potentially unlawful contract.

Budlender argued that because Dlamini has failed to explain and apologise for this crisis beneficiaries now face, and Parliament has not fulfilled its duty in holding the minister to account, it is now up to the court to intervene.

“…the painful truth is that the executive has failed its duties … The painful truth is that Parliament has failed in its oversight,” he said.

David Unterhalter, representing FUL, said in his submission that “CPS has no right to benefit from its [Constitutional] obligation. It may not profit as a result of the unlawful contract it enjoyed in the past”.

FUL has argued that CPS, as an organ of the state, has a Constitutional duty to ensure that grants are paid, even if their terms are not met by the state during negotiations.

But Justice Mbuyiseli Madlanga highlighted the conundrum the Concourt finds itself in. It is unclear how long CPS’s contract with Sassa will last, but it will be longer than the five years it initially planned when the contract was first signed in 2012.

“We would be giving CPS a 12-year contract when all they bargained for was a five-year contract,” Madlanga said.

FUL argued that six months will be too little time for Sassa to find an alternative to CPS, but suggested that one year would suffice.

The Concourt will still hear submissions from Corruption Watch and the Post Office (Post Bank) and this afternoon, from Sassa and Social Development Minister Bathebile Dlamini, and CPS’s legal representatives this afternoon.