Transition to new grant payments system hopeless, says panel
The South African Social Security Agency’s (Sassa’s) repeated failure to take decisions and execute actions required in terms of the Constitutional Court’s order of March 17 makes a smooth transition of the social grant distribution by April 1 virtually impossible, says the court-appointed expert panel.
In its second report, submitted to the court on November 16, the panel said that, with a few exceptions, the senior leadership at Sassa responsible for driving the process, "does not seem to have the required knowledge, experience or skills, or even the will, to execute the Sassa mandate to ensure the efficient and effective management, administration and payment of social assistance".
It has recommended that the Treasury investigate the conduct of Sassa employees and Department of Social Development officials "in relation to all actions undertaken since 2016 to issue contracts to service providers or to give effect to the court order of 17 March 2017".
The panel wants the Treasury to determine whether any person should be prosecuted in terms of the Public Finance Management Act or any other relevant law.
The panel’s report also raises concerns about the interministerial committee’s plans to collaborate with the South African Post Office.
"It would seem that many have accepted the concept of a government-to-government collaboration whereby [the Post Office] takes over the social grant payment services from CPS [Cash Paymaster Services] without a proper analysis of whether there are other efficient and cost-effective options available for present purposes."
In the annexure to its report, the panel described the Post Office’s proposed pricing, which is above what is charged by CPS, as opportunistic and only made possible by the lack of competing bids. If accepted, the prices would result in an additional R2bn of annual operating costs to Sassa by year five.
It said its offering to beneficiaries was superior to CPS’s service offering as it included a number of free cash withdrawals at ATMs.
In its conclusion, the panel said Sassa’s approach "appears to be using the grant payment system to address the challenges [the Post Office] is facing, at great cost to the … system".
Post Office CEO Mark Barnes said on Tuesday he had not yet seen the panel’s report.
The panel argues for a more effective use of SA’s banking infrastructure and national payment system. It said cash distribution from CPS pay points cost about R50 per beneficiary, whereas electronic payments to beneficiary bank accounts cost only 50c per beneficiary.