CAPE TOWN, October 25 – The Standing Committee on Public Accounts (Scopa) has said it was concerned about the South African Social Security Agency’s (Sassa) readiness in appointing a new service provider to distribute social grants by 2018.
This followed a late night Tuesday joint meeting of Scopa and the Portfolio Committee on Social Development and Sassa regarding compliance with the Constitutional Court ruling on the phasing out of Cash Paymaster Services (CPS) and the procurement of alternative payment services.
The highest court in the country had earlier this year ruled on the appointment of a new service provider to execute and take over the distribution of social grants after CPS’s contract ends in March next. In March this year, the Constitutional Court granted an emergency extension to CPS to continue with the payment services until March 2018.
The extension followed after Sassa had failed to phase out CPS after a 2014 ruling that the CPS contract was invalid.
Minister of Social Development Bathabile Dlamini, who was due to appear before parliament and answer questions, again failed to show, informing Parliament that she had to attend another event in Durban.
The situation was resolved by a request to allow Sassa’s new interim acting CEO Pearl Bhengu to deliver a presentation before Scopa and members of the portfolio committee.
During the presentation, Sassa was unable to give clarity on discussions with the South African Post Office (Sapo) which has offered to take over the payment of social grants. Sassa’s inability to answer fully raised concerns with Scopa that the agency was either uncertain or unable to find a credible alternative to CPS.
In its presentation, Sassa failed to give details as to what each it and Sapo were each doing.
Bhengu told Scopa that she could not give detailed answers prior to a Wednesday meeting with Sapo to further discuss contract negotiations.
“We are still negotiating in relation to the figures regarding the R6.4 billion development of the payment system. We will be meeting Sapo on Wednesday to discuss Thursday’s negotiation before its (Sapo) response on Thursday, which was due on Wednesday. But unfortunately, Sapo had requested an extension.”
However Scopa was scathing of Sassa dragging its feet saying that there were only five months until the March 2018 deadline and there was little clarity on the way forward.
Bhengu told the meeting that Sassa was concerned about Sapo not having all the necessary payment service equipment. She said that the agency pays out R10 billion each month on social grants and was concerned about keeping those funds safe.
“The Bidder was required to produce a minimum of 4.2 million cards per annum. Sapo offered only 10,000 per day, totaling 2.4 million in a year.”
Bhengu further said that in its bid documents Sapo had failed to disclose its appointed supplier to provide bank cards and this omission “meant that the capability of the supplier could not be assessed”.
Meanwhile, the opposition Democratic Alliance (DA) said it will write to the Chairperson of the Portfolio Committee on Social Development, Rosemary Capa, to request that she formally summon Minister Dlamini to come and account.
“If Dodging Dlamini again fails to show up, she could face serious consequences for ignoring a summons, including possible arrest. Sassa’s failure to get the ball rolling on finding a new service provider to pay out social grants is a disaster ushering in a crisis,” the DA said.
“The Minister’s failure to show up to a meeting at this critical time is nothing more than a delaying tactic to once again ensure that the contract with CPS continues.”