SASSA insists on a future without CPS

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Social development minister Susan Shabangu. (Photo source: GCIS)
Social development minister Susan Shabangu. (Photo source: GCIS)

Social development minister Susan Shabangu has once again reiterated the South African Social Security Agency's (SASSA's) intention to sever ties with Cash Paymaster Services (CPS) by September.

According to Eyewitness News, Shabangu says SASSA is working hard to ensure the South African Post Office (SAPO) takes over as the sole distributor of social grants.

"We [are] pushing post office like yesterday. They have to be ready; they have to make sure that they do become that service provider which takes care of our people. And make sure that no individual suffers," she is quoted as saying.

However, promises about a future without the services of the Net1 UEPS Technologies subsidiary are nothing new.

Same promises, different year

To avert a SASSA payments disaster, in March last year the Constitutional Court (ConCourt) was forced to allow the extension of the social grants contract with CPS to continue for another year.

During this time, SASSA would have to find a suitable entity to assist the agency to take over payments in the future. Last May, minister Bathabile Dlamini, who was social development minister at the time, promised to phase out the services of CPS by the end of that year.

Instead, as the extended contract was nearing its end this year, SASSA approached the ConCourt once again to request an extension while it phased out CPS and phased in SAPO. According to the agency, the request to extend the contract was also to ensure payments at cash pay points.

As SASSA and SAPO prepared to commence the payment of social grants to 7.7 million of the 10.8 million beneficiaries from 1 April, both entities had no solution for the rest of the beneficiaries that receive payments via cash pay points.

To avoid non-payment of more than 2.8 million beneficiaries, the ConCourt granted another six-month extension from 1 April to 30 September, leaving CPS to assist with payment support to the rest of the social grant recipients. Using vehicles equipped with biometrics, CPS still distributes money to the social grant recipients.

On the same page

It does, however, appear that Shabangu and CPS are on the same page about the status of doing future business

Last week, amid allegations the paymaster's employees were interfering in processes facilitating the migration of social grants from the old CPS cards, Herman Kotze, CEO of Net1, said his company looks forward to the final termination of the current contract between SASSA and CPS at the end of September, in accordance with the ConCourt's order.

The CPS parent company also previously stated it is looking forward to being released from its contract with SASSA in September. The technology company noted the social grants contract "has become a burden" on the group.

"Based on recent public statements by the minister of social development, the South African Post Office and SASSA, we look forward to being released from the social grants payment contract by the end of September 2018," read the statement.

As per Kotze's statement, nothing has changed and CPS is committed to adhering to the court's order.

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