The Constitutional Court - the highest in SA - has ordered the SA Social Security Agency (SASSA) to act on a tender to handle payments to some 15 million social grant beneficiaries.
This was revealed on Friday when incumbent provider Net1 UEPS Technologies updated its local and US shareholders on the status of the new tender. SASSA was forced to reissue the tender - worth about R10 billion - after the Constitutional Court ruled, at the end of 2013, that Net1's win was not valid.
However, the new tender process has been beset by delays since the court's April ruling that a new bid would have to be drawn up. The agency initially published the new document in October, but this was then challenged by Net1, which argued there were several irregularities in the tender.
Subsequently, the closing date for the tender was pushed out to 27 February - from an initial date of 28 November, which was extended to 12 December. Post that update, towards the end of last year, the Constitutional Court on Friday directed SASSA to incorporate changes in the request for proposals by 2 April, and get the new document out by 17 April.
However, the court also noted Net1 unit Cash Paymaster Services (CPS), which won the initial bid, may have further objections to the amended request for proposals and, should this be the case, it needs to notify the court by 16 April. This would drag out the bid process even further.
If there are no more legal wrangles, all bids need to be in by 17 May, and the tender awarded by 15 October - almost two years after the initial deal was declared invalid.
Standing firm
Net1 has indicated it is confident of winning the deal, despite the current contract being marred by controversy after it lost the lengthy legal battle, launched by Absa unit AllPay, which claimed irregularities in the process.
The deal has also come under investigation by the US Securities and Exchange Commission and the Department of Justice's Criminal Division to determine whether there was bribery involved in the R10 billion contract with SASSA.
According to the ruling, if SASSA's request for proposals, which tests the market, shows it is not tenable to issue a new tender, it can continue to use Net1's services.
The court's declaration of invalidity was based on two grounds: SASSA failed to ensure Net1 unit CPS's empowerment credentials were objectively confirmed, and the second bidder notice did not give enough clarity around the biometric requirements, rendering the process uncompetitive.
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