Channel Life Limited and Sanlam Developing Markets Limited challenge

6 May 2016

The social grant system remains an important tool for poverty eradication and provides poor households with means to meet their basic needs. This year, the South African Social Security Agency (SASSA) celebrates 10 years of delivering social assistance. Whilst this is cause for celebration, a lot still needs to be done to improve its effectiveness.

Since the start of the CPS contract in 2012, SASSA has been inundated with complaints from grant beneficiaries regarding unauthorised, unlawful and immoral deductions from the SASSA branded account. Regulation 26A of the Social Assistance Act provides for one deduction of not more than 10% of the value of the grant for funeral cover. The Department of Social Development released new regulations today to further clarify and bolster Regulation 26A. In 2014, SASSA initiated the funeral clean-up project to protect the rights of beneficiaries and ensure compliance which includes obtaining valid mandates directly from beneficiaries for funeral policy deductions.

On 5 October 2015, two funeral insurers, Channel Life Limited and Sanlam Developing Markets Limited, made an urgent application to the North Gauteng High Court to interdict SASSA from implementing the funeral clean-up project. A contestation, amongst others, is whether the signed agreement between the funeral insurer and the grant beneficiary constitutes 'written consent' as envisaged by the Regulations.

The Black Sash Trust has made an application to be admitted in the matter as amicus curiae with the Centre for Applied Legal Studies (CALS) as their legal representatives. Black Sash, together with other civil society groups, has conducted research to illustrate the impact of unauthorized and fraudulent grant deductions on grant beneficiaries.

Black Sash will also advance arguments concerning the effect of deductions from the children's grants. We will also advance arguments that speak to government's constitutional obligation in Section 27 to realise the right to social security. Corporates should refrain from interfering with the state's duty to provide social security to the most vulnerable members of society. "This is an important case as it asks the court to determine the parameters of SASSA's powers in protecting the constitutionally guaranteed right to social assistance," says Lynette Maart, Director of Black Sash.

The matter is set to be heard on Tuesday, 10 May 2016, when the North Gauteng High court will determine Black Sash's intervention as amicus curiae.

For enquiries, please contact:

Elroy Paulus

082 748 5621

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Lynette Maart

021 686 6952

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