The South African Social Security Agency's (SASSA's) process to completely cut ties with Cash Paymaster Services (CPS) in the payment of social grants seems unlikely, despite instruction to do so.
This is the view shared by the Standing Committee on Public Accounts (Scopa) in Parliament yesterday.
Scopa is concerned SASSA's open tender to find service providers to cover services the South African Post Office (SAPO) is unable to provide may leave a window open for "CPS to jump back on the social grants bandwagon".
CPS, a division of Net1 UEPS Technologies, was ordered by the Constitutional Court to continue payment of social grants until the end of March 2018. The court also ordered SASSA to use this time to usher in a new payment provider, with SAPO hotly tipped as the frontrunner to take over from CPS.
However, with less than eight months before the ConCourt deadline, SASSA is yet to determine the post office's shortcomings in paying millions of social grants recipients. CPS has been the paymaster of social grants to over 10 million recipients since it was awarded the tender to carry out these services in 2012.
Reporting to Scopa, the social security agency told members that once SAPO's bid has been evaluated and adjudicated, it will know the extent of services the post office is unable to provide. These services will then go on open tender, SASSA told the committee.
Scopa chairperson Themba Godi, who has been critical of SASSA as the social grants debacle played out, indicated he did not get a sense that SASSA was "enthusiastically embracing" SAPO.
"It seems it is not really about what SAPO can't do, but rather you deciding that SAPO won't be able to do," he said.
Godi has ordered SASSA to provide a follow-up report to the committee on 5 September, when both the evaluation and adjudication of SAPO's bid will have been completed.
On the side-lines
Scopa's concerns seem to echo sentiment that former SASSA CEO Thokozani Magwaza's resignation likely hampered SAPO's prospects to take over the payments function.
The national postal service provider's desire to distribute social grants on behalf of SASSA was supported by Magwaza, while minister Bathabile Dlamini only peripherally mentioned her department's engagements with other organs of state towards phasing out the services of CPS by November.
The former SASSA CEO also placed on record that Dlamini torpedoed plans to involve SAPO during the time when SASSA was looking to take over social grant payments.
Further doubt has been cast over the post office's pay-point networks. SAPO will have to compete with a network of over 10 000 CPS pay-points nationally. The post office has just over 2 000 outlets.
Net1 CEO Herman Kotz'e previously noted there is logic in government's intention to use SAPO to distribute social grants, but the question is how it will cater to citizens in deep rural areas.
According to him, SAPO's footprint in rural areas is not as exhaustive as it is in urban areas; it needs a plan to specifically cater for all social grant recipients.
SASSA told Scopa it has asked that other pay outlets for social grants, such as supermarkets and commercial banks, stay in place to ensure beneficiaries are paid after the ConCourt deadline.
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