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Dlamini faces Scopa on social grants saga

Simnikiwe Mzekandaba
By Simnikiwe Mzekandaba, IT in government editor
Johannesburg, 07 Mar 2017
Social development minister Bathabile Dlamini was grilled by Scopa in Parliament today.
Social development minister Bathabile Dlamini was grilled by Scopa in Parliament today.

Social development minister Bathabile Dlamini admitted to the Standing Committee on Public Accounts (Scopa) in Parliament this morning that her department underestimated the work needed to be done to take over social grant payments.

The minister, her department and the South African Social Security Agency (SASSA) have been scrambling for answers to avert a potential social grants disaster when the contract with the current payments master expires at the end of the month.

Chairperson Themba Godi said Scopa called today's briefing in the interest of determining how the department and SASSA arrived where they are, and to give the minister the opportunity to account for the crisis in social grant payments.

Godi said it is of national interest that social grant payments must be done legally.

Dlamini was meant to appear before Scopa last week, but failed to do so. Scopa held the meeting with the Department of Social Development and SASSA in the absence of the minister.

Some 20 minutes into this morning's briefing, Dlamini finally arrived to answer to the committee.

Explaining why she did not show up at last week's meeting, the minister said she had other responsibilities.

Dlamini said it is the accounting officers who are supposed to report to Scopa, and she had already briefed the committee in November. With regards to the issues raised by Scopa, Dlamini said she had already accounted to the social development portfolio committee in Parliament.

CPS to the rescue

Cash Paymaster Services (CPS), a division of Net1 UEPS Technologies, administers and distributes social grants in SA after it was awarded a five-year, R10 billion tender in January 2012.

That contract, however, was declared invalid by the Constitutional Court in 2014, after it emerged irregular tendering processes were followed.

According to Dlamini, after running tender processes and failing to find a suitable payments distributor for two years, SASSA decided to move payment of social grants in-house. However, the agency was unable achieve this.

Insisting social grant payments will be paid on 1 April, Dlamini stressed her department underestimated the timeframe to find alternative solutions for SASSA to be able to meet the commitment of paying social grants.

This resulted in the situation the department and SASSA found themselves in. Last week, the Net1 subsidiary, the department and SASSA were in negotiations to discuss the terms and conditions of a new contract.

Yesterday, Serge Belamant, chairman and CEO of Net1, said his company had locked in a new contract deal with the department and SASSA.

According to reports, CPS and SASSA have agreed to the terms of a new two-year contract.

The minister was reluctant to respond to questions with regards to the contract with CPS, but said the parties negotiated to come up with a new contract and not extend the current invalid contract.

She added the terms negotiated are favourable to SASSA and the department.

While it has been reported the fee charged each month for each recipient will be R25, Dlamini said the rate is R16.44 per beneficiary per month, although they have not agreed on an amount, as noted by her.

She added that a technical team will meet on Thursday to give her a report with regards to the new contract, after which she will meet with the finance minister.

Dlamini pointed out the department is mindful that National Treasury has said the present budget will be used and the department will not receive extra money.

Presidential backing

Growing calls for Dlamini to step down appear to have gone unnoticed by president Jacob Zuma, as he has thrown his weight behind the minister's ability to ensure beneficiaries receive their social grants on 1 April.

As the social grants debacle unfolded, Dlamini insisted beneficiaries will be paid come April.

eNCA reports that Zuma assured South Africans grants will be paid at the beginning of next month and called on Cabinet ministers not to speak on the matter of social grants.

"I'd like to appeal to the ministers themselves that they should not talk in public and answer questions. They must work on what we have agreed, and pay people on the date.

"Talking to the country and answering questions is not helping. In fact, it helps to fertilise the situation where people are speculating," eNCA quoted the president.

According to the news outlet, the president said he summoned the social development and finance ministers to explain how they were handling the grant crisis, as he was due to leave the country.

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