SASSA has filed an affidavit with the Constitutional Court that effectively seeks to extend its contract with Cash Paymaster Services.
Sassa’s contract with CPS was declared invalid by the Constitutional Court in 2014 on the basis of improper tender processes. In April 2017, the court suspended its invalidity order until the end of next month (31 March 2018) in order to allow Sassa to find a new service provider. The South African Post Office is the new provider and Sassa has applied to the Constitutional Court for CPS to continue during the transition.
In a statement, Sassa said the affidavit would form part of their request for the suspension of the court’s ruling of invalidity on the CPS contract to be further extended.
“This is to allow SASSA to phase out CPS and phase in a new service provider,” said national spokesperson Paseka Letsatsi. “The reason for this development is that the contract with CPS ends at the end of March and a new service provider can only be appointed after the CPS contract ends.”
Letsatsi said the Panel of Experts appointed by the Constitutional Court had indicated in their second report to the court that there would be a need for such an engagement.
“This will be for a limited service, namely cash payments at Paypoints, because SASSA and the South African Post Office (SAPO) have already tested other functions such as payment through banks and retailers and will be able to roll out other services from April without the involvement of CPS,” Letsatsi said.
“During the extended period Sassa would have appointed a new service provider for taking over cash payments at Paypoints. 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.”
Letsatsi said on Friday that Sassa had successfully paid more than 2 million beneficiaries who received their grants from commercial banks. “This was done today through our Paymaster General account which was opened. This move is a giant step taken towards Sassa ultimately paying all beneficiaries
using any type of electronic payment method. It is part of fully complying with orders of the Constitutional Court and phasing out CPS, the current service provider.”
As from 1 March 2018, Sassa would do direct transfers to about 5.7 million
beneficiaries who use the Sassa card. This would bring about 80% of payment transactions under the control of the Agency by the end of March 2018.
“By April 2018, the only beneficiaries who whose payments won’t be falling under Sassa control will be the ones paid in cash at Sassa Paypoints,” Letsatsi said.
The South African Post Office had already tendered for a service provider for the cash payment category, affecting nearly 3 million beneficiaries.
Other points Letsatsi noted were:
- Sassa has taken over the legislated life insurance premium deductions of 700 000 beneficiary accounts previously deducted through a third party contractor, resulting in significant savings for the government.
- Sassa was currently negotiating with the banking industry in order to develop a low cost banking account which would be subsidised by Sassa so that beneficiaries get the full value of their grants without paying bank charges. “Such an account will not allow electronic debits and is intended to protect beneficiaries from unauthorised debits which have been a problem in the past,” Letsatsi said.
Letsatsi emphasised that the current Sassa card is still valid and would expire only at the end of the year, by which time the new Sassa/SAPO card would have been introduced.
“Sassa has gone on a countrywide awareness campaign to inform beneficiaries with these developments and to eliminate fake messages which tell beneficiaries to switch to some questionable new cards.
For queries about Sassa payments call 0800 601 011.
