8 November 2017
The Constitutional Court's decision extending the suspension of invalidity on the contract between the South African Social Security Agency (SASSA) and Cash Paymaster Services (CPS) ends on 31 March 2018. For SASSA to meet its legal obligations, it needs an alternative grant payment system and in the interim a new service provider. However, since the Constitutional Court judgment on 17 March 2017, there has been no progress.
Chairperson of the Inter-Ministerial Committee (IMC) for Comprehensive Social Security, Minister in the Presidency Jeff Radebe, told the joint hearing of Parliament’s Standing Committee on Public Accounts (SCOPA) and the Social Development Portfolio Committee today that government will move with the necessary speed to introduce an integrated payment system which will be provided by government through a partnership between SASSA and the South African Post Office (SAPO), working with entities like Home Affairs. A project plan will be developed by Friday 17 November 2017. While the intervention by the IMC is welcomed at this late stage, we would like to see concrete action by 21 November 2017.
It is also unclear what is meant by a hybrid model for the payment of grants and how the banks will be involved. The Banking Association of South Africa (BASA) indicated its willingness to assist. One of its members, Grindrod Bank, with IT support from Net1, has created the SASSA bank account and recently the EasyPay Everywhere bank account to facilitate debit orders and other deductions particularly for Net1 subsidiaries. In the course of our community monitoring work, we have taken up many cases of unauthorised, fraudulent and unlawful deductions and debit orders. We do not want a repeat of the past where profit is the sole motive of the service provider and grant beneficiaries’ constitutional right to social security and social assistance is violated.
In order to re-establish the integrity of the social grant system the Black Sash would like to reiterate the important considerations below:
- The personal confidential data collected during the social grant registration process must be protected and used only for the payment of grants. It should not be used for the marketing and sales of financial and other services. This protection should also include the bank cards issued to grant beneficiaries, the machines reading these cards and the control of access to confidential data.
- The bank accounts of grant beneficiaries must be ring fenced and protected from debit orders and unauthorised, fraudulent and unlawful deductions. Child support grants and temporary grants need particular protection.
- The new bank account should include some free services such as no transaction costs should be charged for cash withdrawals from ATMs, and grant beneficiaries should receive at least one free bank statement a month.
- Grant beneficiaries must be able to navigate the recourse system independently, with no cost which is currently almost impossible.
The Black Sash will continue to monitor these developments and look forward to the report on 21 November 2017.
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