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SASSA works on contingency in case ConCourt bars CPS contract extension

Feb 28, 2018
SASSA works on contingency in case ConCourt bars CPS contract extension

The Acting CEO of the South African Social Security Agency (SASSA), Pearl Bhengu, says the social welfare agency is developing a contingency plan in the event the Constitutional Court does not extend the Cash Paymaster Services (CPS) contract by six months.

This comes after SASSA approached the Constitutional Court earlier this month to ask that the contract be extended as part of a phasing in-phasing out process that would be a transition for CPS to handover the payment of social grants to the SA Post Office (SAPO). 

Briefing the Portfolio Committee on Social Development on Wednesday, Bhengu said SASSA’s EXCO [executive committee] met recently and resolved to draft a contingency plan on how it can handle the transition, should the court reject the application. 

The Constitutional Court is set to rule on SASSA’s application on Tuesday, 6 March. 

“We held an EXCO as SASSA [yesterday] where we wanted to look at things and make some very concrete resolutions in case the court says no to our request,” said Bhengu. 

In the event the contract is extended, SASSA would have appointed a new service provider for taking over cash payments at pay points. For the agency, cash payment services means the provision of payment cards, security, mobile ATM or payment machines, loading money, among others. According to SASSA, this will only affect 2.9 million out of 10.6 million grant beneficiaries, which is 27% of the beneficiaries and will have no adverse impact on operations. 

SASSA has successfully paid over two million beneficiaries who receive their grants from commercial banks.

In 2014, the Constitutional Court had ruled that the contract SASSA signed with CPS was illegal and invalid. However, in April 2017, the court suspended the invalidity of the contract to March 2018 to allow time for SASSA to find a new service provider. 

Court gives CPS permission to bid for SASSA contracts 

Meanwhile, Bhengu said the Constitutional Court ruled on Friday to allow CPS to bid for contracts with SASSA. 

CPS had submitted an application to the Constitutional Court stating that excluding the company from bidding for work with SASSA was unconstitutional. 

“And then on Friday, that judgment came out from the court. When they [CPS] initially made that application, as SASSA we wrote to the court as well trying to oppose the application because of some of the areas that we saw, especially with the deduction part. 

“I think Black Sash also put an application but the court has ruled that CPS can actually tender for SASSA again and I think that is very important for the committee to note that they have been allowed by the court on Friday and they can tender with any other business with SASSA, especially with the cash payment tender that is in process right now,” Bhengu said. – SAnews.gov.za