The Minister of Social Development, the Department of Social Development and the South African Social Security Agency (SASSA) need to account for the unauthorised, undocumented and illegal debit deductions from the bank accounts of social grantees by outsourced contractor, Cash Paymaster Services (CPS) and holding company NET 1 since the introduction of the biometric system in 2012.
Social Assistance, as enshrined in Section 27 of our Constitution, provides a vital income for millions of South African households trapped in a binary of poverty and inequality, unable to provide for their own needs and those of dependents. The public purse pays social grants to the elderly, the disabled, as well as children, who are found through a stringent means test to be in real financial need. Approximately 15 million people benefitting from social grant provisions have become the target of commercially motivated and unscrupulous credit by financial service providers, who use confidential personal information, entrusted to our government.
The unauthorised, undocumented and unlawful debit deductions crisis, fuelled by greed and excessive profits, is eroding the mandate and integrity of the social security system. It is also eroding gains made towards the progressive realisation of social security over the last 20 years since our democracy. Thousands of families are experiencing increased hardship and now struggle to pay for food, rent, school fees, transport and other basic needs due to these deductions, seriously compromising basic human dignity.
As early as 2011, the Black Sash and partners began to uncover violations of Norms and Standards at SASSA Paypoints and found increasing evidence of irregular, unauthorised and undocumented third party debit deductions from SASSA beneficiaries’ bank accounts. In 2012, largely as a result of the Service Level Agreement between the SASSA and CPS/Net1, debit deductions of social grants increased drastically. Furthermore, the CPS’s recourse systems remains ineffective, adding additional burden and cost on social grant beneficiaries.
The Stop SASSA-CPS Debits Campaign launched in 2013 by the Black Sash and supported by various civil society partners, draws attention to the crisis of debit deductions from social assistance grants. For a period of a year, we registered concerns with government using information generated from desperate calls to the Black Sash Helpline, the Legal Resources Centre, community advice offices and CBOs across South Africa. Whilst we are encouraged by government’s acknowledgement that things are seriously wrong – actions to remedy the crisis are inadequate and slow.
Correspondence in November 2013 and our open letter dated 6 January 2014 to the Department of Social Development, SASSA, the South African Reserve Bank and related government departments as well as public entities requested an urgent meeting. The 29 January 2014 meeting to be held at Khotso House, Johannesburg provides a public platform to register the crisis and consider responses and actions from government, particularly from the Minister of Social Development, the Department of Social Development and SASSA. We will hear testimonies from SASSA beneficiaries, advice offices and other CBO partners bearing witness to the impact of these deductions on individuals, households and communities. We expect government to provide substantial answers to our queries, requests and demands.
In this regard, the Black Sash and partners calls for:
- The Minister of Social Development to intervene decisively to stop the escalation of unauthorised, undocumented and unlawful deductions from bank accounts of social grant beneficiaries.
- The Minister of Social Development to amend the Social Assistance Act criminalising the use of social assistance grants as collateral by lenders and to stop the sale of credit and other products. Parliament amends the National Credit Act and related legislation so that social assistance grants are not considered as income, as intended by the legislation.
- The Minister of Social Development and SASSA to immediately in-source the social assistance grants to protect government’s social security mandate and ensure the effective and secure implementation of legislation, policies and systems. Fast track the implementation of the Inter-Ministerial Committee’s recommendation to develop a SASSA payment system independent of external service providers before the deadline of 2015 and report publicly on plans and steps taken in this regard.
- The Minister of Social Development, SASSA and third parties be held responsible for providing recourse and compensation for these debit deductions.
- The Minister of Social Development establishes the long overdue Inspectorate for Social Assistance as intended by the Social Assistance Act of 2003 to “ensure the maintenance of the integrity of the social assistance framework and system” and to conduct appropriate investigations.
For immediate release
For further information contact:
- Elroy Paulus, 082 748 5621
- Ratula Beukman, 021 686 6952