Damn­ing re­port on cap­ture of Sassa

Weekend Argus (Sunday Edition) - - NEWS - TSHEGO LEPULE

A DAMN­ING re­port on the fail­ures at the South African So­cial Ser­vices Agency (Sassa) blames former min­is­ter for so­cial de­vel­op­ment Batha­bile Dlamini.

It out­lines how Dlamini and her ad­min­is­tra­tion were cat­a­lysts which led to the agency be­ing cap­tured.

Dlamini now serves as the min­is­ter for women in the Pres­i­dency.

The re­port, penned by Pro­fes­sor Mark Swill­ing of the Cen­tre for Com­plex Sys­tems in Tran­si­tion at Stel­len­bosch Univer­sity and re­searcher Robin Fo­ley,is ti­tled “How one word changed the game”.

It de­tails the his­tory of Sassa and the events that led to the cap­ture of the agency by forces not linked to the Gup­tas.

“What is sig­nif­i­cant about this re­port is that it is an ex­am­ple of state cap­ture that is not linked to the Gup­tas ...it shows that it is a much wider sys­temic prob­lem,” said Swill­ing.

Sig­nif­i­cantly, the re­port shows how civil so­ci­ety ac­tu­ally averted a much big­ger dis­as­ter at Sassa.

“There isn’t much ev­i­dence of large scale loot­ing that runs into the bil­lions like in other in­sti­tu­tions and that can be at­trib­uted to ac­tions of or­gan­i­sa­tions such as Black Sash and Cor­rup­tion Watch and oth­ers that used the Con­sti­tu­tional Court to get rul­ings that con­stantly crip­pled the strate­gies of state cap­ture to re­ally take over Sassa.”

He warned that “to think be­cause there is a change in po­lit­i­cal lead­er­ship that state cap­ture is over is a grave mis­take; all that has changed is the rules of the game and how we fight that pat­tern.

“And the prob­lems per­sist at the Depart­ment of So­cial De­vel­op­ment.

“Sassa is by no means in good hands.

“What we are hop­ing to do by re­leas­ing this re­port, is to say they should not re­lax... we can’t trust the Cyril Ramaphosa ad­min­is­tra­tion to fix this on their own.”

The re­port pro­vides a roadmap that led to desta­bil­i­sa­tion of the in­sti­tu­tion which saw the panic last year when around 17 mil­lion ben­e­fi­cia­ries were at risk of not re­ceiv­ing their grants be­cause of the con­tract awarded to Cash Pay­mas­ter Ser­vices (CPS) that was later ruled as in­valid.

The roadmap shows:

2006: Sassa takes over con­tracts with provin­cial ser­vice providers at a time when the sys­tem was frag­mented and in­ef­fi­cient to the point where at times ben­e­fi­cia­ries re­ceived no grants while oth­ers were paid out twice in dif­fer­ent prov­inces. This ne­ces­si­tated the in­tro­duc­tion of bio­met­ric technology, which would work in the favour of CPS in the 2012 con­tro­ver­sial ten­der.

2007: The agency puts out its first re­quest for pro­pos­als on the pro­vi­sion of pay­ments of ser­vices. The bid ad­ju­di­ca­tion com­mit­tee can­celled the nine bids. It later emerged that the then-chair­per­son of the com­mit­tee, while de­lib­er­at­ing on a R7 bil­lion ten­der process, had al­legedly been of­fered an “open cheque­book” by an in­di­vid­ual claim­ing to be from CPS.

2009: After the failed ten­der bid, the depart­ment con­tin­ued us­ing the ser­vices of CPS, Empil­weni and Al­lPay un­til CPS made the de­mand for a two-year con­tract de­spite Na­tional Trea­sury only ap­prov­ing a year’s ex­ten­sion.

That same year when the South African Post Of­fice agreed to pro­vide spe­cific pay­ment ser­vices, CPS went to court to have this nul­li­fied. A two-year court bat­tle saw the Supreme Court fi­nally val­i­dat­ing the agree­ment which was later in­val­i­dated by Sassa, who put out a new ten­der. This move was seen as the turn­ing point at which Sassa and the depart­ment en­vi­sioned grant pay­ments.

In May, Zola Sk­weyiya was re­placed by Edna Molewa, with Dlamini as her deputy.

Two months later, Sassa chief ex­ec­u­tive Fezile Maki­wane was placed on spe­cial leave fol­low­ing al­le­ga­tions of fraud and con­tra­ven­ing the Pub­lic Finance Man­age­ment Act with ir­reg­u­lar pro­cure­ment prac­tices to the tune of R10 mil­lion, al­le­ga­tions which were never sub­stan­ti­ated and led to him su­ing the depart­ment for R6.7m.

“In hind­sight this is a story that ap­pears to be repli­cated through var­i­ous ex­am­ples of state cap­ture, the re­moval of Maki­wane al­lowed for a change in the ap­proach by the agency to dis­tri­bu­tion of grants and how this should be taken,” reads the re­port.

2010: A cab­i­net reshuf­fle by former pres­i­dent Ja­cob Zuma sees Dlamini be­com­ing the min­is­ter for so­cial de­vel­op­ment and ap­point­ing Vir­ginia Petersen in 2011, days after a new ten­der pro­posal was re­quested, who also is­sued amend­ments to the bid un­der the guise of pro­vid­ing clar­ity of the is­sue of bio­met­ric iden­ti­fi­ca­tion, a move that was seen as the main rea­son CPS was awarded the con­tract in 2012.

What fol­lowed was a pro­tracted court chal­lenge by Al­lPay, who sought to chal­lenge the con­tract, a mat­ter that even­tu­ally ended at the Con­sti­tu­tional Court.

The re­port also high­lighted how un­der the lead­er­ship of Petersen, waste­ful and ir­reg­u­lar ex­pen­di­ture in­creased dras­ti­cally at the agency.

Ac­cord­ing to its an­nual re­ports in the 2010/2011 fi­nan­cial year, ir­reg­u­lar ex­pen­di­ture stood at R8.8m, an amount that had ac­cu­mu­lated from 2007.

How­ever by the next year the recorded amount al­lo­cated as ir­reg­u­lar ex­pen­di­ture for that year stood at R47.4m.

The lat­est re­port showed that the clos­ing bal­ance for ir­reg­u­lar ex­pen­di­ture stood at R1.4 bil­lon.


Grant ben­e­fi­cia­ries, in­clud­ing, the el­derly and dis­abled, have been sent from pil­lar to post due to Sassa de­ba­cles re­lat­ing to the pay­ment of their money. A re­port into the agency’s fail­ures blames former so­cial de­vel­op­ment min­is­ter Batha­bile Dlamini’s...

Batha­bile Dlamini

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