10 things to note about the Sassa crisis

2017-03-09 05:30

1. The current contract for the payment of social grants expires on March 31. The Constitutional Court declared the contract with Cash Paymaster Services (CPS) invalid in 2014, but suspended the order so that Sassa could make alternative plans.

2. In 2015 there was a tender process for a new service provider but according to the department it didn’t receive enough bids that met all the administrative requirements.

3. A ministerial task team had earlier found that Sassa must pay out the grants itself.

4. One of the reasons why Sassa wants to use CPS as service provider after March 31 is because it’s the only company that meets its requirements for biometric identification.

5. CPS is a subsidiary of the company Net1. The department of social development took steps against N1 over illegal deductions from grants

6. One of the options was to use the Post Office and Post Bank for the payments, but Sassa said the Post Office was not ready and its footprint too small in some areas.

7. Social Development Minister Bathabile Dlamini said she only became aware in October 2016 that Sassa would probably not be ready to take over grants payments by March 31.

8. The new agreement that is expected to be concluded with CPS will mean there will have to be a deviation from the legal prescripts on procurement.

9. The budget for the grants payment contract is about R2 billion, but it is feared CPS will easily be able to negotiate for more money because Sassa has its back against the wall.

10. In the 2015-2016 financial year, Sassa spent an additional R316 million irregularly on the CPS contract for the re-registration of grant beneficiaries because legal requirements had been circumvented.

Alicestine October
Parliamentary journalist
Media24 Parliamentary Bureau
City Press
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May 19 2019