The South African Post Office has put on its superhero cloak and swept onto the scene of the social grants debacle to come and save the day. On Tuesday it filed papers saying it was ready to take over the grant payments from Cash Paymaster Services, whose contract expires at the end of the month. The contract cannot continue because it was ruled invalid, but because the South Africa Social Security Agency has failed to take steps to put alternative measures in place, Black Sash has asked the Constitutional Court on Wednesday to help with a solution.
The Post Office's counsel, advocate Aslam Bava SC told the court the Post Office was "standing in the wings", but the sniggers from the public gallery in the court suggested that the hero was a comic one.
"Do you have an admirable track record in terms of service delivery?" Chief Justice Mogoeng Mogoeng asked. "I'm not a businessperson and I'm not, to use South African lingo, a tenderpreneur. I'm going on common sense," Mogoeng said, before adding that the Post Office's plan seemed overly ambitious.
This is why Bava said the Post Office realised that you could not mess around with 17 million beneficiaries, and why the Post Office can pay out the grants:
- The Post Office already operates, through Post Bank, six million accounts. There might be more than one beneficiary to an account.
- The Post Bank isn't the same thing as the Post Office. Post Bank makes 20 million payments itself (the time frame for this was unclear, however). With all these disruptions (referring to strikes), Post Bank was not affected. It runs 5.6 million accounts which is substantial and is in the process of applying to become a bank by July.
- Post Bank has a track record of having paid 500,000 beneficiaries in the Eastern Cape for the past 10 years.
- The SA Post Office can take over this process in the course of a month, using a voucher system, and then rolling out the system properly over the next nine to 12 months. In remote areas, it can use Fidelity Securities, currently being contracted by CPS, which can set up 10,000 payment points in community halls in remote areas.
- The Post Office will charge R20 per beneficiary to pay out the grants, while CPS wants R22 (it currently charges R16). Once their illegal contract comes to an end, the court should order a wind-down procedure to allow the Post Office to take over.