'The country is gripped with panic' as deadlock continues with Sassa and Sapo

Social Development Minister Bathabile Dlamini said Sassa needs a service provider that can carry out four ​core tasks of the social grants sche​me. (Gallo)

Social Development Minister Bathabile Dlamini said Sassa needs a service provider that can carry out four ​core tasks of the social grants sche​me. (Gallo)

The South African Social Security Agency (Sassa) and the South African Post Office (Sapo) have been entangled in a lengthy negotiation battle to try work out a deal for the payment and management of social grants.

On Wednesday evening, the treasury’s director general Dondo Mogajane provided feedback. 

He had mediated at three of four meetings held since Tuesday. He said that it was “unfortunate” that Sapo and Sassa had not found each other because they had not met to discuss and understand banking systems.

Mogajane said that the issue lacked guidance from the inter-ministerial committee and that political direction would be sought. 

Both Sapo and Sassa have asked the treasury to review the process. 

But, Social Development Minister Bathabile Dlamini wants Sapo to prove its efficiency. 

The chair of the portfolio committee on social development Rose Capa said,  “The country is gripped with a panic”, and asked what the alternative would be if the impasse continues.

Telecommunications Minister Siyabonga Cwele asked that a clearer way forward should be presented by Monday, before the case is taken to the inter-ministerial committee.

Sapo and Sassa’s upcoming meetings will also include input from the South African Revenue Service (Sars).

IFP MP Mkhuleko Hlengwa said that whoever is behind the collapse of the Sasso/Sapo deal must be dealt with accordingly and the deadlock appears to be deliberate.

“There are 100 work days until April 1 2018”, said the IFP’s Liezl van de Merwe, but “nothing has happened in the past seven months.”

The IFP has also called on President Jacob Zuma, as chair of the inter-ministerial committee, to explain to Parliament what work has been achieved. 

A January inquiry will investigate whether Dlamini should be held personally liable for the social grants debacle.

On Tuesday, Dlamini, Telecommunications and Postal Services Minister Siyabonga Cwele, Sassa and Sapo appeared before a joint meeting in Parliament.

During this meeting, Dlamini told the MPs and the chair of Parliament’s Standing Committee on Public Accounts (Scopa), Themba Godi, that no agreement had been reached between Sassa and SAPO yet as the deal had reached a deadlock.

According to Dlamini, Sassa needs a service provider that can carry out four core tasks of the social grants scheme which are: having an integrated IT payment system, providing banking services, having card production facilities and provision of cash payment services.

Dlamini said that Sapo is only able to build an integrated IT payment system and doesn’t have the capacity to carry out the other services which is why Sassa was going to use an open tender process to find service providers for the remaining three services.

Sapo CEO Mark Barnes explained that the four services could not be separated and that Sapo was able to provide all the needed services including banking (through a partnership with Standard Bank) which is what Dlamini expressed most concern about.

Godi and the MP’s present at the joint meeting expressed unhappiness at the lack of progress on Tuesday with Dlamini agreeing that the entities should “sit through the night” and “see if we find ourselves.”

Sassa has just five months to find a new service provider to pay grants since their contract with their current provider Cash Paymaster Services (CPS) will end in March 2018.

However, critics do not think Sassa will make the deadline. 

The contract between Sassa and CPS was declared invalid by the Constitutional Court but has remained due to Sassa’s inability to find an alternative service provider.

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