Sassa failure to appoint new service provider 'gross mismanagement'

Cape Town - A total of 1.5 million grant recipients in the Western Cape will be in limbo should Sassa not get its house in order, Social Development MEC Albert Fritz said on Tuesday.

He intended writing to Social Development Minister Bathabile Dlamini for feedback on what emergency steps she would put in place to ensure recipients got paid on April 1.

Nationally about 17 million beneficiaries are at risk of not getting paid when Cash Paymaster Services’ illegal contract with the department ends on March 31.

Finance Minister Pravin Gordhan had proposed that banks and the post office distribute the funds.

Dlamini previously said failure to pay out on the day would be "disastrous".

In 2014, the Constitutional Court declared the contract with CPS invalid, but suspended the invalidity order. Sassa was given until March 31 this year to find a new distributor or take over the grant system.

The SA Social Security Agency (Sassa) appeared before Parliament’s standing committee on public accounts (Scopa) on Tuesday to account for its proposed extension to the illegal arrangement with CPS.

Sassa project lead Zodwa Mvulane told the committee they would not extend the contract, but rather wanted a new contract, with new terms.

Social development deputy director-general Zane Dangor said if talks with CPS were to fall through, plan B would be to deposit money directly into special bank accounts, with permission from the banks.

Fritz said Sassa indicated it would only begin this process on March 1, giving itself only 31 days to complete the “mammoth task” of appointing a new service provider.

Until then, grant recipients would not know if they would be paid on time.

“It is clear that Sassa finds itself in a self-created crisis, for which Minister Dlamini must take full responsibility.”

Fritz said Sassa had kept provincial departments in the dark about the matter, and he had received no communication from the national ministry either.

Sassa’s failure to appoint a new service provider three years after the Constitutional Court’s ruling was “gross mismanagement”.

“Swift action must be taken if we are to avoid a national crisis,” he said.