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Black Sash seeks more details on SASSA system

Government is working to usher in a new national grant payments system.
Government is working to usher in a new national grant payments system.

Some of the options that will give shape to the hybrid model for future social grant payments still remain unclear.

This is according to the Black Sash, which notes the service agreement signed between the South African Post Office (SAPO) and SA Social Security Agency (SASSA) as work in progress.

Jeff Radebe, minister in the presidency and chairperson of the Inter-Ministerial Committee, announced that SAPO will be the official distributor of SASSA grants, effective 1 April 2018.

Government's new grants payment system, a hybrid payment model, is a signal that SA's national postal service will take over the payments function from the current provider, Cash Paymaster Services (CPS).

CPS, a Net1 UEPS Technologies subsidiary, distributes social grants on behalf of SASSA. The CPS contract, which was declared invalid, would have come to an end on 31 March.

The Constitutional Court suspended the order of invalidity and ordered a year-long extension of the contract until the end of March 2018 to avoid a social grants catastrophe.

In a statement, Black Sash says it is concerned that the agreement says some payment services, such as cash-in-transit (CIT), guard services and card disbursement services, which are available to two million beneficiaries, "may be provided by SAPO".

The advocacy group states: "At this stage, it is not clear who will provide this service and SASSA could initiate a separate competitive tender for these services. There is a real danger that the CIT tender could take a considerable time to conclude and be implemented. This may even result in the extension of the current CPS SASSA contract.

"The SASSA SAPO agreement provides for the creation of a special disbursement account into which grants will be paid. It is crucial that the functionalities as well as the terms and conditions of this account be included in the agreement. The account should exclude debit orders and any other deductions, such as those resulting from USSD platforms (eg, prepaid electricity and airtime).

"It is essential that government covers the cost of the banking services, so that beneficiaries can receive the full cash value of the grant. The SASSA SAPO agreement should also include a dispute mechanism so that grant beneficiaries are able to lodge queries if they encounter any problems with their accounts."

The proposed hybrid model options still remain unclear, Black Sash continues: "There is no written agreement on the banking product(s) that will be offered by the commercial banks. Like the special disbursement account held by SAPO, the functionalities and terms and conditions of the proposed account must be clearly defined and form part of the agreement between SASSA and the banks.

"The Black Sash would like this to explicitly exclude debit orders and other deductions. The bank account(s) should be endorsed by the South African Reserve Bank (SARB). SARB should also play an oversight role and deal decisively with any unethical conduct."

Read time 2min 40sec
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