‘If all else fails, we’ll take cash directly on trucks to people’

TAKING money by trucks to pay social grant beneficiaries after April 1 was mentioned yesterday as one of back-up options the South African Social Development Agency hopes to to use in ensuring there is no disruption in grants payment in April.

This was revealed to Parliament when Sassa and the Social Development Department appeared before their oversight portfolio committee along with the South African Reserve Bank.

After playing their cards close to their chests, department officials responded to desperate questions from MPs after they expressed worries over the negotiations with Cash Paymaster (CPS) failing.

This happened against the backdrop of the department abruptly withdrawing its court papers it filed with the Constitutional Court on Tuesday while starting negotiations to extend the contract for pension grant payments with CPS.

Responding to questions, director-general Zane Dangor said extending the contract with CPS was the most practical option hence they had engaged in negotations to secure a contract.

Dangor said one of their strategies was to pay out grants through the banks as 90% of beneficiaries have bank accounts.

He mentioned another option they could also utilise, which would be used when all failed.

“We will do what we have done in exceptional cases in the past. It is risky, but it has been done before,” he said.

“It is to take cash directly on trucks and pay people obviously, using safety systems. That option will be deployed when all fails. We don’t foresee that happening,” Dangor said.

At yesterday’s meeting Minister Bathabile Dlamini was absent for the second time in a row.

She was reportedly attending a cabinet meeting . A Sassa delegation led by acting chief exsecutive Thabo Mzobe, who is chief executive of the National Development Agency, was in negotiations with CPS.

Also absent from the meeting was Sassa chief executive Tjokozani Magwaza, who Dangor said was “booked off ill” after Dlamini appointed Mzobe to act in his position for seven days.

SARB head of national payment system Tim Masela also said the banking regulator was not in a position to express an opinion whether Sassa could mitigate the risk of the current grant payment system or the take-over.

“SARB will support (the) transitional option chosen by Sassa that will ensure continued payments without any interruption beyond March 31,” he said, adding that such should be within the legal framework.

Masela said the finalisation and implementation of a payment system should be undertaken without further delays.

“SARB as a regulator may offer regulatory guidance where it is required.”

During his presentation he outlined the options Sassa had in the distribution of the grants which included the “competitiveness and open architecture”.

This entailed greater choice of banks by beneficiaries where they can select a bank, an account and also the use of Postbank in far flung areas of the country.

“This open co-branded offering would limit the need for a “winner takes all” tender approach and promote competitiveness among banking providers‚ “Masila said.

As a way to tackle illegal deductions, Masela said there could be a special account which would set out what was to be deducted. Some 17 million people receive grants.