Sassa acting CEO Pearl Bhengu and Sapo CEO Mark Barnes. Picture: KOPANO TLAPE/GCIS
Sassa acting CEO Pearl Bhengu and Sapo CEO Mark Barnes. Picture: KOPANO TLAPE/GCIS

The acting CEO of the South African Social Security Agency (Sassa), Pearl Bhengu, has highlighted the difficulties that would ensue for the approximately 2.8-million beneficiaries who receive their social grant payments at cash paypoints, if the Constitutional Court were to refuse Sassa’s application for a further six-month extension of the invalid contract of Cash Paymaster Services (CPS).

The court heard the application for an extension this week.

Bhengu said at a joint media briefing with South African Post Office CEO Mark Barnes on Thursday that the further suspension of the invalidity would also ensure a proper phase in-phase out process by CPS.

CPS support was needed, Bhengu said, for the distribution of cash at cash pay points.

Without this service, beneficiaries would have to be allocated a PIN number and travel to an ATM or other distribution points, which would be difficult for the elderly and disabled.

Benghu said Sassa intended depositing money into the Sassa cards for those beneficiaries who received their social grants in cash from pay points, but support would be needed to pay the cash.

A tender has been issued for a contractor for cash payments and this service provider will distribute social grants using the new Sassa-Post Office card at all pay points across the country.

Bhengu also said Sassa, through National Treasury and the Reserve Bank, was in talks with commercial banks for the establishment of a low-cost account for social grant beneficiaries who receive their money directly into their personal bank accounts.

She noted that for those beneficiaries who received their grants through bank accounts, Sassa had successfully implemented pilot projects since January 2018 to pay them directly via commercial banks, including Postbank.

Sassa made direct payment to more than 2.3-million beneficiaries for the month of March, and this number would be increased further in April.

In April, a total of 5.7-million beneficiaries transacting through the Sassa Payment Card will be paid directly by Sassa without the assistance of CPS.

By April 1, Sassa would have paid approximately 7.7-million of the 10.7-million beneficiaries directly.

Sassa and the Post Office used the occasion of the joint press briefing to reaffirm their good working relationship and their readiness to take over the payment of social grants as from April 1.

"The service agreement signed between Sassa and Sapo in December 2017 enabled Sapo to partner with Sassa in the payment of social grants, ushering in a public sector-led and efficient grants payment hybrid model," Bhengu said.

Barnes noted the "significant state of readiness" for Sapo to commence payments of social grants. Regarding cash payments, Barnes said Sassa and Sapo were starting to phase in a process where, if a current Sassa pay point was within 5km of a Post Office branch and the branch met the minimum norms and standards, then the Post Office would take over the cash payments of that pay point.

There are about 865 Post Office branches where this could take place, and which over time could cater for about a third of those beneficiaries who receive their social grants in cash.