Expiring social grant contract 'will take its toll on CPS finances'
In financial results in June 2016, Net1 said unless it could replace most or all of the revenue from the Sassa contract, it was likely to suffer materially
NET1's Cash Paymaster Services (CPS) will come under financial strain in 12 months when its contract with the South African Social Security Agency finally comes to an end, after years of controversy around the contract and after months of speculation about whether grants would be paid from April. In a damning judgment that lambasted Social Development Minister Bathabile Dlamini and Sassa for creating an emergency because they failed to do their jobs, the Constitutional Court ruled on Friday that CPS would continue with the contract under the same terms and conditions as those in the current one, which expires at the end of this month. CPS had recently said it would negotiate a new contract at a higher fee. David Shapiro, the deputy chairman at Sasfin Securities, said he suspected that the company would be hurt when the Sassa contract expired "Of course it is going to hurt them, it will damage their reputation ... I thought that with this kind of scandal they would have had to answer...
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