Shabangu suspends new grant payment tender

Social development minister Susan Shabangu has refused to sign-off on the South African Social Security Agency’s annual performance plan which had been drafted by her predecessor Bathabile Dlamini and former Sassa chief executive Pearl Bhengu.

In the process, Shabangu has suspended a new tender which would have taken over grant payments from Cash Paymaster Services (CPS).

Shabangu insists however, social grant payouts will not be affected.

“We suspended the tender of the 2.5-million people’s payment because there were challenges… in the process of the tender,” Shabangu told the parliamentary committee.

According to Shabangu, the current team evaluating the tender proposals does not have the technical knowledge nor expertise to carry out evaluations. Shabangu says she will need more time to appoint the right individuals for the task.

“Nothing has changed; there is no new mechanism which has been put in place to replace that. If there is a new mechanism, we will explain it,” said Shabangu.

Another issue which emerged during the committee meeting was the R10 banking fee that Grindrod Bank began charging grant beneficiaries last month. Shabangu explained Sassa had not agreed to the bank charge and would be taking up the issue. At the moment, the bank has an arrangement with treasury where it will facilitate the payment of social grants for the next three months.

Grindrod uses Net1’s technology to pay out social grants and CPS is in turn connected to Net1 as one of its subsidiaries.

Shabangu explained to the parliamentary committee that she has written to the Constitutional Court explaining her decision and the changes within Sassa.

After less than a year on the job, Shabangu confirmed Bhengu has stepped down as Sassa’s acting chief executive and returned to a provincial post in KwaZulu-Natal. Abraham Mahlangu will take her place in the interim becoming the agency’s third chief executive in less than two years.

Last year, Sassa staff members raised concerns about Bhengu’s appointment citing her business connections to Dlamini’s daughter as possible conflict of interest.

Shabangu told the committee that Sassa wants to comply with the Constitutional Court’s deadline of September, saying that the agency was not looking for an extension.

In March this year, Sassa asked the Constitutional Court to extend the CPS contract, which was declared invalid in 2014, because “a phase-in and phase-out process was needed”. 

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