Sapo won’t take over grants
The procurement process will conclude on February 28
SOCIAL Development Minister Bathabile Dlamini yesterday ruled out giving the South African Post Office (Sapo) more than a limited role in paying out welfare grants and said the government would invite other companies to bid for the contract.
In a statement, Dlamini said Sapo fell short on three of four key functions needed to pay out grants to some 12 million recipients every month.
It could not print the required 4.2 million beneficiary cards per annum that were required, or vouch for a subcontractor who would do so, she said.
Neither could it provide a full-scale banking service that includes a disbursement account linked to a card with biometric verification data and assure that cards were compliant with all existing ATM machines.
This would force grant recipients to travel to receive their payouts and put their safety at risk, she suggested.
The minister said the SA Social Security Agency believed Sapo could play a role in grant distribution by “supplementing the current distribution infrastructure with the Sapo brick and mortar”.
“This can be achieved in a very short space of time, through the deployment of ATMs and point of sale devices that provide cash back. Authentication and verification can be achieved through biometric and the testing of biometric enrolment should start in February.
“This will assist the Sapo to revive its closed outlets, in particular, the ones that are based in rural areas and townships so that employment is also created.”
Dlamini said Sassa would therefore initiate a new procurement process for service providers to handle those functions Sapo cannot.
The procurement process will conclude on February 28.
This is a month before the deadline imposed by the Constitutional Court for a new contract to replace the current one with Cash Paymaster Services (CPS) expires.
Dlamini’s critics have in recent months accused the minister of seeking to manufacture another welfare payout crisis, and extend the deal with CPS.
She made the announcement a day before she was expected to appear before Parliament’s standing committee on public accounts to explain delays in reaching an agreement with Sapo.
The minister infuriated the committee last week when she failed to appear to report back on negotiations which were clearly in danger of stalling.
On Friday, Scopa chairperson Themba Godi threatened to call for a vote of no confidence in the minister if she did not report substantive progress in talks with the Post Office.
He pointed out that Sapo chief executive Mark Barnes had stressed that it would take five months to prepare to take over grant payments from April.
Further delays created the impression that the minister was dragging her feet and engineering a repeat of the crisis the country faced this year when the CPS contract was due to expire with no other suitable service provider signed up.