13th Mar2017

To Grant or Not to Grant: Inside Sassa’s Grant Crisis

by admin



17 million South Africans currently receive social grants from the South African Social Security Agency (Sassa). Until early this year, Sassa was efficient in its provision of social grants to its beneficiaries. In order to decrease the risk of corruption, Sassa has (until now) enlisted the services of Cash Paymaster Systems (CPS) to pay out some R10 billion to the beneficiaries. It has emerged though, that Sassa’s contract with CPS has not been renewed. This means that, come 01 April, the social grants recipients will not receive their payments.

The Sassa crisis has led to the demonization of the Minister of Social Development, Bathabile Dlamini. What has emerged is that the looming crisis is the result of Sassa’s reported R1 billion in irregular expenditure and financial payments. The Constitutional Court found that Sassa’s initial contract with CPA/Net1  was irregularly awarded, leading to the gross irregular expenditure during CPA/Net1’s tenure as the provider of social grants. The Constitutional Court, following its initial ruling, refuses to allow Sassa to extend its contract with CPA/Net1. Sassa needs The Constitutional Court to authorize its use of CPS as it has not found any viable alternative service providers. However, on the same day Sassa filed papers requesting for The Constitutional Court to authorize its use of CPS, Sassa drew up papers to for a notice to withdraw application.

Moreover, the South African cabinet has failed to address the social grants payment crisis. The Sassa crisis was not mentioned in the post-Cabinet statement, with Minister in the Presidency Jeff Radebe stating that there had not been enough time to address the matter. Sassa, itself has been plagued by internal difficulties with the current CEO, Thokozani Magwazani, being placed on “sick leave” for twelve days. His, and Bathabile Dlamini’s, notable absence from a meeting between Parliament’s committees on public accounts on 27 February resulted in Themba Godi (chairman on the committee) ending the meeting as there was no one who was able to answer questions about the grant crisis.

Seemingly, the looming crisis does not look to be averted anytime soon. Sassa has only started negotiations with CPS/Net1 on 28 February. Tensions between Dlamini and Godi were apparent at Sassa’s presentation to the social development portfolio committee on 22 February, with Dlamini dominating, leaving no room for Sassa officials to speak. The crisis will affect South Africa’s poorest, resulting in substantial socio-economic crisis. In 1994, the newly-elected South African government stated that its principle interest lay in protecting society’s vulnerable and marginalized. Additionally, the South African Constitution was primarily drafted to protect the rights of all South Africans, who include the poor. South Africa’s high levels of socio-economic inequalities have become more deeply entrenched in the socio-politico-economic order. Sassa was developed in order to address the developmental crisis experienced by South Africa’s poor. The crisis demonstrates that Sassa has failed in its responsibility to South Africa’s poor. The crisis seems to be a more tangible example of how post-apartheid South Africa’s dreams are increasingly not being realized.

One Response to “To Grant or Not to Grant: Inside Sassa’s Grant Crisis”

  • Neo Malaka

    One would have thought that the ending of apartheid and the implementation of democracy would make a difference in the lives of all but sadly that is not our reality. It is true that there is a wider range of opportunities for people of all races but the issue of social class and standard is what hampers our growth and development as a nation.
    It is rather unfortunate that our government is coming across such “obstacles” yet solutions aren’t being found or put into action fast enough to suppress the damage that could result from them. I think the core reason that we experience these injustices is that our authorities have their priorities in the wrong places. I may not be a part of the marginalized majority but I do know that the direct impact of no longer receiving their payments can only mean trouble for their families. Many people depend on that income as it is their only source of income. The government needs to contain and in actual fact correct this matter before it becomes uncontrollable. Referring back to our constitution would be a great place to start.

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