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Shopsteward Volume 26 No. 2

COSATU Media Monitor COSATU Media Monitor COSATU Media Monitor


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  |  COSATU Press Statements

COSATU is extremely concerned and alarmed by Sassa's inept handling and overall bungling of the grant payment contract

The Congress of South African Trade Unions is extremely concerned about the inept manner in which the South African Social Security Agency (Sassa) is handling the extension of its contract with Cash Paymaster Services and the brewing fight between The Department of Social Development and Treasury on this matter.

This is likely to see the 1st of April 2017 playing a cruel and practical joke on the poorest and most vulnerable groups of South Africans who are beneficiaries of the social grant system. This is because the South African Social Security Agency (SASSA) has approached the Constitutional Court to extend their contract with Cash Payment Services (CPS) for another year. If the Constitutional Court dismisses SASSA's application, social grants may not be paid come the 1st of April 2017.

There are 17 million of South Africa's poorest, who are dependent on social security every month. The Department of Social Development pays out a total of R10 billion to beneficiaries each month. Amongst the most vulnerable groups are the elderly, the disabled as well as children below the age of 18. Research has proved that most of the social grants are spent on food, meaning that a disruption to this social security system could be catastrophic and ultimately life threatening.

As the 1st of April deadline looms, it appears that SASSA may have no option but to extend their existing contract with CPS or risk cutting off millions of people's lifeline.

Treasury has indicated that the extension of the invalid contract with CPS is unlawful and that SASSA would have to approach the Constitutional Court for clarity. The tender given to CPS and their parent company Net1, was declared invalid by Concourt in 2014 due to a number of legal challenges and controversy, among others the allegations of unlawful deductions made from grant beneficiary accounts.

In 2014 SASSA declared its intent to conduct grant payments in house. However the extension of the CPS tender points to SASSA's unpreparedness and a lack of capacity to carry out this function.

COSATU is calling on the department of social development to ensure that it gets its house in order. This like the death of psychiatric patients in Gauteng shows the problems that come with government departments outsourcing their mandates to private hands and the agencification of the state. In reality, many government departments resort to outsourcing with no improvement in efficiency or cost saving. Through outsourcing government continues to waste billions of rands ,which can be better spent creating jobs and providing better services to the poor.

COSATU demands the total eradication of outsourcing of government functions, the tendering system and agencification of the state. Outsourcing is wasteful, threatens jobs and makes public control and accountability impossible , therefore providing a breeding swamp for corruption and nepotism to thrive.

Issued by COSATU

Sizwe Pamla (National Spokesperson)

Tel: +27 11 339-4911 Direct 010 219-1339
Mobile: 060 975 6794- 082 558 5962
E-Mail: sizwe@cosatu.org.za