Sassa cancels tender process to find CPS replacement

The South African Social Security Agency (Sassa) has cancelled the tender process to find a replacement for Cash Paymaster Services (CPS), court papers show.

Sassa’s invalid contract with CPS was extended for six months by the Constitutional Court in March, so that CPS could continue to operate the cash portion of the grants system until a replacement was found.

Social Development Minister Susan Shabangu had initially “suspended” the tender process in late April due to “challenges” in the advertisement.

READ MORE: Shabangu suspends new grant payment tender

Court papers filed to the ConCourt on Friday show that new acting Sassa CEO Abraham Mahlangu cancelled the tender process to find a new service provider on May 15, following various “technical problems” inherent in the tender advertisement.


Instead, Shabangu will set up a “technical committee” to explore and recommend alternatives to the cash payment of social grants, the papers read.

The technical committee will “advise on matters relating to the transition from CPS and the appropriate governance dispensation of Sassa, with the ultimate purpose of ensuring that the orders of the Court are fully complied with,” Shabangu’s papers read.

Shabangu explained that the various department work streams, CSIR reports and ministerial advisory committee reports over the last few years could not assist Sassa in taking over the grants system from CPS in full, leading to the various extensions.

“A need therefore exists for a technical committee to be established to inter alia consolidate, analyse and evaluate all the reports produced by the different entities and to make recommendations on the basis of the immediate, medium and long-term strategic outlook and the overall impact this will have on Sassa.”

It will “also assist Sassa with the implentation of alternatives to the cash payment services”, and be operational for a period of 12 months.

The five members on the technical committee will include:

  • Dipuo Peters: Former minister of transport and former premier of the Northern Cape.
  • Vusi Madonsela: Director general of the department of justice and constitutional development and former DG of the department of social development.
  • Totsie Memela: Former managing director of Post Bank and executive officer of the Women’s Development Bank Trust.
  • Selwyn Jehoma: Former director general of the department of social development.
  • Sipho Shezi: Former special adviser to the former minister of social development.

“An update on the technical committee will be included in my report that is due at the end of May 2018,” Shabangu concluded in the papers to the ConCourt.

“I am mindful of the 30 September 2018 deadline and I have every intention to ensure compliance thereof.

“I further remain committed to ensuring that Sassa realises its objective to ensure the uninterrupted payment of social grants to beneficiaries.”

Shabangu herself raised issues with the tender process three weeks ago, initially suspending the process pending further consultations.

The news of its complete cancellation raises renewed doubts about Sassa’s ability to find an alternative for CPS by September, if it eventually opts to advertise a new tender.

Acting Sassa spokesperson Kgomotso Diseko told News24 that the minister’s technical team was now handling the issue, and the re-advertisement of the tender was not imminent.

Black Sash ― the initial complainants in the matter in the Constitutional Court ― had previously raised questions about Shabangu’s decision to initially suspend the tender three weeks ago.

The new developments once again raises serious questions over whether there will be even more delays to find a CPS replacement, Black Sash national advocacy manager Hoodah Abrahams-Fayker told News24 on Tuesday. 

The NGO would release a full formal statement later on Tuesday, she added.

Sassa and Shabangu was in Parliament on Tuesday before the standing committee on public accounts (Scopa) to account for irregular expenditure amounting to R1.3-billion.

The issue of the cancelled tender did not come up in the meeting. ― News24

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