‘Post Office is ready to replace CPS’

The South African Post Office could, as soon as next week, finalise a contract with the South African Social Security Agency (Sassa) that would enable it to take over welfare grant payments for the next few years, CEO Mark Barnes said yesterday.

“We are writing a contract. We are working on it now, every day,” Barnes said after briefing parliament’s select committee on communications and public enterprises.

“We are hoping to have it finalised by mid-June, so that is next Friday.”

But he stressed that he did not want to create the impression that it was a done deal, because it still needed the approval of Social Development Minister Bathabile Dlamini.

Barnes told MPs that the minister had yet to give the go-ahead for the Post Office to replace Net1 subsidiary Cash Paymaster Services (CPS) as the distributor of about 17 million welfare grants.

Responding to questions from MPs, he said he was confident it could perform the service.

“The job is not as difficult as the incumbent made out to be. They made it sound difficult on purpose,” he said of CPS.

Barnes added CPS’s technology was not as advanced and hard to match as it claimed and the use of biometric data was not the obstacle to switching service providers, as had been claimed.

He told the committee the Post Office would need a commitment this month to ensure a smooth roll out, saying October would be “too late”. The Post Office would need an estimated three months to produce 12 million cards with embedded data for welfare beneficiaries to access their grants.

Dlamini in February rejected a proposal for the Post Office to step into the breach when the CPS contract was about to expire. Her objections included that the Post Office did not have infrastructure in deep rural areas, or the technology to use biometric data which, she maintained, was the only method of preventing grant fraud (something Barnes also disputed).

Barnes noted yesterday that CPS did not have a single point of representation. “They do not even own a tree,” he stressed.

The Constitutional Court blamed Dlamini for the welfare grant crisis in March, when it transpired that Sassa was years away from being able to take over payments.

The court instructed CPS to continue providing the service until an alternative was put in place.

Dlamini said recently it would take five years and about R6 billion to get Sassa ready to pay grants.

Barnes said negotiations with Sassa had proceeded with a view to an interim arrangement running for two to three years, with five years as an outer figure. – ANA