Confusion abounds on the issue of extending the social grants payments tender to ensure 17 million beneficiaries are paid when the contract with the current distributor expires at the end of March.
Yesterday, SA Social Security Agency (SASSA) spokesperson Kgomoco Diseko confirmed the agency will file its application with the Constitutional Court (ConCourt) to have the contract extended.
However, numerous reports note SASSA will only make its plea today, requesting the highest court in the land to extend the social grants tender with the current payments distributor.
There have been other reports that the social development department, to which SASSA reports to, had yet to decide whether to seek an order from the ConCourt.
This marks further uncertainty on the saga of how beneficiaries will be paid from 1 April.
Following a portfolio committee briefing on 1 February, SASSA told Parliament it planned to approach the highest court in the land on 8 February, but realised it was not ready to submit a report. The agency noted it would approach the court on 15 February.
Approaching the ConCourt to extend the Cash Paymaster Services (CPS) tender is an effort to avoid the catastrophic situation that will affect millions of social grant beneficiaries.
South African social grants are currently administered and distributed by CPS, a subsidiary of US-based Net1 UEPS Technologies, after it was awarded a five-year, R10 billion tender in January 2012.
The tender was declared invalid by the ConCourt in November 2013, and SASSA was instructed to initiate a new tender process. In 2015, SASSA issued a new tender contract but did not award the tender opting to move the payment of social grants in-house.
ITWeb’s attempts to obtain clarity from SASSA on the matter went unanswered by the time of publication.
Meanwhile, National Treasury has refuted reports suggesting there is a “war looming” between minister of finance Pravin Gordhan and minister of social development Bathabile Dlamini.
Yesterday, reports surfaced that the finance minister does not want the reappointment of CPS as the service provider for the distribution of social grants come 1 April.
The Star newspaper reported that on 1 February, Gordhan wrote to Dlamini, and stated a new contract should be awarded to commercial banks and the SA Post Office.
The newspaper alluded to a looming showdown between the two ministers on the issue of social grant payments and extension of the tender with CPS.
The Star quoted an excerpt from Gordhan’s letter: “I am informed that the SASSA team and, in particular, the executive have argued for option one and two to be implemented as it is perceived this may be the only solution under the current circumstances.
“However, if this route is taken, it will certainly expose government to legal challenges…”
In a statement issued yesterday, Treasury says the context and the headlines are misleading.
“From the onset, National Treasury acknowledges that the minister of social development has sole and primary responsibility for the function of paying social grants and that SASSA, as the responsible authority for paying social grants, must take a final decision on the matter.
“National Treasury needs to put it on record that its involvement in the matter of the payment of grants beyond the 31 March 2017 was at the behest of the Department of Social Development (DSD) and SASSA,” says the statement.
It adds: “Accordingly, National Treasury explored and analysed the pros and cons of a range of payment options and provided expert inputs in areas of procurement, public finance, financial sector policy, banking and other related matters. However, it is up to SASSA as to which option to choose taking into account all relevant facts, laws and regulations. This includes the relevant decision of the courts in the same matter.
“National Treasury is happy that the DSD has committed to seek the view of the Constitutional Court insofar as the option it prefers is concerned on which the court has previously made a determination.”
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