Grant fiasco looming large

Sassa, Social Development coy on contingency plan ahead of March handover

THE South African Social Security Agency (Sassa) has made no firm arrangements with any key players to ensure a smooth handover at the end of March when the contract with Cash Paymaster Services (CPS) ends.

Because there are no concrete plans with CPS, the banks or retailers, the payment of social grants to 11 million vulnerable recipients across the country in April is looking extremely precarious.

What is more, it appears that the critical cut-off date for some decisive action from Sassa is not the end of March but early January when CPS starts to wind down its operations.

The prospect of hiccups with the payments of social grants has serious implications for Shoprite and Pick n Pay whose major role in helping to distribute 11-million grants places them in an uncomfortable frontline position.

Shoprite chief executive Whitey Basson said on Monday his company had not received information about any firm plans for April and there had been no discussions with Sassa. Basson said it was wrong to expose vulnerable people to even more risk.

Serge Belamant, chief executive of Net1 UEPS, which owns CPS, said at the weekend Sassa did not have until endMarch to come up with a plan to ensure grant distributions are not interrupted.

Belamant said Sassa had had no discussions with him about continuing to use the services that CPS provides during a handover period after March.

“Coming to me in March will be too late; I’ve got to start closing down the operation in early January,” Belamant said.

He had to give notice to thousands of full-time employees and tens of thousands of people who helped out during the distribution days, Belamant said.

He also had to give notice on leases for properties scattered around the country.

“The infrastructure costs R90-million a month, I’m not going to keep it open in the expectation that Sassa will ask me to assist with the handover of the contract,” he said.

Belamant said once the infrastructure was closed down it would take at least two months to set it up again.

When asked for comment, Sassa spokesman Kgomoco Diseko said the agency had channels through which it negotiated with its contractors.

“Negotiating through the media is not an option,” said Diseko, adding that Sassa had received no formal communication from CPS on this issue.

The current arrangement between Sassa and CPS, which operates in terms of a contract declared invalid by the Constitutional Court, is due to terminate at the end of March.

During a parliamentary portfolio committee meeting last week Social Development Minister Bathabile Dlamini assured MPs there would be no interruptions to the payments.

Social development director-general Zane Dangor said the department was “committed to paying the grants on April 1”.

But Sassa’s presentation, which referred to options and work-in-progress, gave little indication of how its own distribution system would be up and running by April.

When pressed for details, the minister said that they had outlined their options as required by the committee. “Now we are being called to give a full account of our contingency plan, that will put some at an advantage and will put some of our work at risk. We don’t want to risk our work,” Dlamini said.

ANC committee member Solomon Mabilo said the minister’s response was unacceptable. “We are a constitutional structure. When we put a question to an agency [of government] and are told it puts work at risk … this is unacceptable.”

Belamant said he had heard nothing from anyone in the industry about what Sassa might be planning.

“Unless they come up with something magical they will have to issue new cards and that process will take at least a year,” Belamant said.

Reverting to the previous system of cash and vouchers was not an option.

“Cash and vouchers was possible when there were only 2 million recipients. it’s impossible with 11 million.” — BDLive