NEWS
05/01/2018 07:04 SAST | Updated 05/01/2018 07:04 SAST

Sassa Wants CPS Contract Extended Again

Sassa says CPS will need to stay on while the Post Office contract is being phased in.

ANC Women's league President Bathabile Dlamini looks on during a press conference at the 54th National ANC Conference in Johannesburg, on December 19, 2017.
MUJAHID SAFODIEN via Getty Images
ANC Women's league President Bathabile Dlamini looks on during a press conference at the 54th National ANC Conference in Johannesburg, on December 19, 2017.

The South African Social Security Agency (Sassa) will ask the Constitutional Court to extend the invalid Cash Paymaster Services (CPS) contract for another six months, the Mail & Guardian reported on Friday.

This is apparently because Sassa needs CPS to distribute grants while the new contract with the Post Office is being phased in.

In November, a months-long deadlock was finally broken when the Post Office and Sassa reached a deal that will see the Post Office becoming the grants distributor, according to News24.

In terms of the new agreement, the Post Office is to oversee the main functions of grant distribution on April 1. But the agreement reportedly did not exclude external parties from assisting, especially commercial banks. The Banking Council of SA agreed in principle to assist, and more meetings between banks, Sassa and the Post Office were planned. If the CPS contract is extended again, the assistance of the banks could be unnecessary.

Social development minister Bathabile Dlamini appeared "determined to have CPS again as the only organisation that is capable of dispensing the social grants", said political analyst Karima Brown in a discussion on the issue on Talk Radio 702 in October.

Sassa reportedly made this request in a report to the Constitutional Court, filed in early December.

The CPS contract was declared invalid and unlawful by the Constitutional Court in 2013, but was extended so as not to interrupt the distribution of grants. The contract ends in March 2018.

Sassa will also ask Treasury for permission to deviate from tender procedures so that the CPS contract can be extended again.

"The transition process will cover the phasing out of CPS and the phasing in of Sapo for electronic payments and a new service provider for the cash payments. To this extent, a formal application for the suspension of declaration of invalidity and subsequent extension of the contract with CPS will be lodged with the Constitutional Court," the Sassa report reportedly says.