South Africa’s Finance Minister Pravin Gordhan said yesterday that he is “fairly confident” social security payments will be paid on April 1 despite a service-provider dispute that has cast doubt over the welfare benefits.
The South African Social Security Agency (SASSA) is scrambling to ensure that as many as 17mn people continue to receive their money, despite concerns that retaining the existing provider is both unlawful and costly.
Dominated by more than 11mn child support grants, the welfare system is a lifeline for South Africa’s most vulnerable.
Each month long queues form at pay points across the country as people wait for the money that is often the difference between going to bed hungry or not.
“I am fairly confident grants will be paid,” Gordhan told parliament’s public accounts committee, referring to April 1.
The dispute has led to opposition calls for the social development minister, an ally of President Jacob Zuma, to resign.
The existing contract, run by Cash Paymaster Services (CPS), a unit of technology company Net1 unit, has been in doubt since South Africa’s highest court ruled in 2014 that the tender process to acquire its services was unlawful.
It ordered that a new contract be negotiated.
At the time, SASSA and CPS said the system was working well and there was no realistic possibility anyone else could take over the contract without huge disruption.
“It would take at least 18 months for anyone to come in and do the same thing,” Serge Belamant, Net1’s chief executive, also told 702 Talk Radio yesterday.
Officials at SASSA have said the agency has opted to renew the deal with CPS despite the court order.
A new deal has not yet been made public.
The Constitutional Court will hear today an application by non-government bodies, Black Sash and Freedom Under Law, for the court to play a supervisory role in any new contract agreed.
The Treasury has expressed misgivings about SASSA retaining CPS, a move also criticised by members of parliament’s committee on public accounts.
“We are trying to be careful not to pre-empt the court in any way, and the court will finally determine the shape and direction of many of the issues we are looking at,” Gordhan said.
Facing a hostile opposition in parliament, Social Development Minister Bathabile Dlamini said “there is no crisis at SASSA” despite media reports citing SASSA’s boss saying he was prevented by the minister from trying to resolve the issue by responding to the Constitutional Court.
Dlamini, who heads the ruling party’s Women’s League, has dismissed opposition concerns.
Gordhan: We are trying to be careful not to pre-empt the court in any way.
