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SASSA gives post office the green light

Simnikiwe Mzekandaba
By Simnikiwe Mzekandaba, IT in government editor
Johannesburg, 19 Oct 2017
SASSA readies to do business with SAPO for future social grants payments.
SASSA readies to do business with SAPO for future social grants payments.

Following delays in appointing a new provider for social grant payments, the South African Social Security Agency (SASSA) has offered to procure the services of the South African Post Office (SAPO).

SASSA's search for a new payments provider follows an order directed by the Constitutional Court (ConCourt).

In March, the ConCourt was forced to extend the contract with Cash Paymaster Services (CPS) for another 12 months to avoid a social grants catastrophe. The court also ordered SASSA to use this time to find a suitable provider when the current contract lapses.

CPS, a subsidiary of Net1 UEPS Technologies, distributes social grants on behalf of SASSA.

In a statement, the Department of Social Development says SASSA has given SAPO an offer and has given it reasonable time to respond.

This after due diligence was conducted on SAPO, says the department's social grants agency.

According to the statement, social development minister Bathabile Dlamini has concurred with the recommendations of SASSA's acting CEO, Pearl Bhengu, flowing from a closed procurement process between SASSA and SAPO.

"SASSA has been hard at work under the leadership of the Department of Social Development and the minister of social development in trying to find the best solution for the payment of social grants.

"The minister indicated that SAPO as a state entity could play a role and participate as merchants where they meet SASSA's mandatory radius. This can assist SAPO to revive some of its closed outlets, especially in the rural areas and townships, and is in line with the department's commitment in promoting government to government partnership as outlined in the report to the Constitutional Court."

Earlier this year, Dlamini announced plans to cut ties with CPS and said her department had begun engagements with organs of state towards phasing out the current payments distributor.

As a state entity, SAPO was hotly tipped as the frontrunner to take over from CPS. Telecommunications and postal services minister Siyabonga Cwele also declared SAPO's readiness to use Postbank to assist SASSA to distribute social grants.

Although the post office has finally been given an offer, the extent of its role in future social grant payments has not been revealed by the social development department.

Instead, the minister thanked the acting CEO of SASSA and the SASSA team for "bringing the process thus far considering the nature of the task to secure the best people-centred system for the payment of social grants".

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