Net1 to appeal against ruling

Net1 UEPS will appeal against an order by the High Court in Pretoria that its subsidiary Cash Paymaster Services pay back R316m with interest to the government.

Net1 UEPS will appeal against an order by the High Court in Pretoria that its subsidiary Cash Paymaster Services (CPS) pay back R316m with interest to the government.

The South African Social Security Agency (Sassa) paid CPS, which administers social grants, R316m irregularly.

Civil rights group Corruption Watch asked the court in 2015 to order CPS to pay back the money as the extra payment was “not justified” under the multibillion-rand tender CPS won in 2012 to distribute social grants to 16-million beneficiaries.

Net1 said at the time Sassa’s payment had been made to recover “additional implementation costs” of reregistering grant beneficiaries in 2012.

Net1 CE Herman Kotzé said the company was disappointed by Friday’s high court judgment and would “immediately seek leave to appeal”.

“The additional registrations we performed at Sassa’s request resulted in the identification and removal of a significant number of ghost beneficiaries and duplicate grants, and had the direct result of saving the South African government more than R2bn per year for the last five years,” he said.

Kotzé said CPS had performed the work requested by Sassa on a bona-fide basis. It was unfortunate the firm was being prejudiced for shortcomings in Sassa’s processes.

Judge Moroa Tsoka ruled the fiscus had been robbed of a substantial amount of money, which was intended for the poor, due to “unlawful conduct” by Sassa.

“It is just and equitable that the payment of R316m made by Sassa to CPS, together with interest, be returned to the fiscus for the benefit of those for whom it was intended in the first place,” he said.

Nongovernmental organisation Corruption Watch said the judgment was a victory for civil society.

It said it showed the importance of pursuing unlawful transactions flowing from irregular procurement processes in which public funds had been abused to benefit private interests.