BLACK SASH PRESS RELEASE: THE CONSTITUTIONAL COURT JUDGEMENT ALLPAY AND OTHERS VS SASSA, CASH PAYMASTER SERVICES

The Black Sash welcomes the outcome of the Constitutional Court judgement in the matter of ALLPAY and others vs SASSA, Cash Paymaster Services and others and finds it significant for a number of reasons. At the core of the judgement is the obligation of an organ of state to respect, protect, promote and fulfil the rights contained in the Bill of Rights, beyond mere contractual considerations.

The contract between Cash Paymaster Services and the South African Social Security Agency (SASSA), an organ of state, for the provision of the country-wide administration of the payment of social grants"is fundamentally public in nature". Judge Froneman cites the judgement of Yacoob J in the matter of AAA Investments, "Our constitution ensures... that government cannot be released from its human rights and rule of law obligation simply because it employs the strategy of delegating its function to another entity".

The Black Sash supports the constitutional court's judgement that SASSA, as an organ of state, cannot divest itself from its constitutional responsibility and public accountability, including the Public Finance Management Act, for rendering a public service. It remains accountable to the people of South Africa for the functions performed by Cash Paymaster Services. When Cash Paymaster Services concluded a contract with SASSA in 2012, to perform a public function, it too became accountable to the people of South Africa. The performance of public functions by any third party brings with it public scrutiny, both in its operational and financial aspects.

The Black Sash is pleased that the judgement terminates the constitutionally unlawful contract between CPS and SASSA and that mechanisms are in place to ensure the continuity of services to social grant beneficiaries.
The Black Sash has been advocating for the in-sourcing of the social grant administration system to SASSA by the 2015 deadline. The Black Sash welcomes the order by the constitutional court compelling SASSA to initiate a new tender process. While the in-sourcing of the social security grants to SASSA may be substantially delayed for another three to five years, the Black Sash takes comfort that the successful commercial company performing a public function will be subject to the same public scrutiny as an organ of state carrying out a public function. SASSA is also under obligation to provide information to the court with respect to its own efforts to in-source the payment of grants. The Black Sash would strongly urge that key milestones with timeframes for the in-sourcing be provided by SASSA to the court. Parliament, the public and civil society need to hold SASSA to account to these milestones and deadlines.

The Black Sash welcomes the establishment of a new Bid Evaluation Committee and a Bid Adjudication Committee, under independent supervision. The Black Sash calls for the credentials and interests of the members of these committees to be placed under public scrutiny. We are pleased that the tender evaluation and adjudication will be made public. The Black Sash further welcomes the structural interdict requiring SASSA to report back to the constitutional court at each of the crucial stages of the new tender process.

The Black Sash is particularly pleased that the "personal data of grant beneficiaries, obtained in the registration and payment processes remains private and may not be used in any manner for any purpose other than payment of the grants or any other purpose sanctioned by the Minister in term of Section 20(3) and (4) of the Social Assistance Act 13 of 2004". Since the inception of the CPS contract, social security grant beneficiaries have experienced a plethora of unlawful debit deductions from their Grindrod linked bank accounts for airtime, electricity and various types of loans. Commercial microlenders and companies linked to CPS and holding companies Net 1are using the ID numbers, bank details and the cellphone contact details provided by grant beneficiaries during the registration processes to aggressively market airtime, electricity and loans. The cost of recourse to stop these unlawful debit deductions is carried, in the main, by grant beneficiaries, often with little or no success. The Black Sash calls on SASSA, the Department of Social Development Social and the Reserve Bank, in the public interest, to protect the bank accounts of grant beneficiaries and to align lawful debit deductions to the provisions in Social Assistance Act and the regulations to only one deduction of 10% for funeral cover. We would request that the court orders impress upon CPS to also declare the income generated from their marketing activities to grant beneficiaries on the back of access to confidential information.

For further comment please contact:
• Elroy Paulus 0827485621, or
• Lynette Maart 021 686-6952