The SA Social Security Agency (SASSA) plans to challenge the recent ruling in favour of deductions from the bank accounts of social grant beneficiaries.
This week, the North Gauteng High Court declared SASSA and the social development minister Bathabile Dlamini can't impose rules and restrictions on electronic payments.
The ruling, which has drawn mass criticism, allows Net1 UEPS Technologies and its subsidiaries, as well as any service provider, to continue making deductions from the accounts of social grant beneficiaries.
SASSA says it has studied the judgment and intends to appeal the matter because of its "unimaginable unintended consequences".
"We are convinced that a higher court will have a different view on this matter," says Thokozani Magwaza, CEO of SASSA.
Burdensome ruling
The ruling is a setback to efforts by the social development department to restrict deductions from the bank accounts of recipients.
Last May, the department introduced new regulations to a section of the Social Assistance Act of 2004. The decision was motivated by complaints from beneficiaries.
The social grants agency says civil society organisations and the department have been inundated with beneficiary complaints regarding unauthorised deductions coming off their grants, and the new regulations were intended to cushion the vulnerable against the actions of "unscrupulous financial service providers".
Net1, the parent company of social grants distributor Cash Paymaster Services, lodged an application with the High Court seeking a declaratory order that the new regulations don't restrict beneficiaries in the way they operate their accounts.
Veteran human rights organisation, the Black Sash Trust, also filed an application requesting the intervention of the High Court in the case of deductions from recipients' accounts.
The court ordered that recipients may continue to initiate debit order instructions? with any service provider, including Net1 and subsidiaries.
It also ordered SASSA, Magwaza and minister Dlamini to pay the costs of the application.
Net1 has welcomed what it says is a "favourable" ruling.
Serge Belamant, CEO of Net1, said: "We welcome this order, as it clarifies that grant recipients may continue to exercise their human rights to transact freely with any service provider, utilising the full functionality of their bank accounts."
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