Constitutional Court extends invalid CPS contract for 12 months
The Constitutional Court has ruled that CPS is constitutionally obligated to make social grants payments, and has extended its current – invalid – contract for a period of 12 months.
The terms of the contract will continue under the 2012 terms. The court did not change its previous ruling, making the CPS contract valid, instead it has extended the suspension of the contract.
The Court said that the social grants programme in South Africa was a vital component in reducing poverty in the country, but the ruling was not a celebration of that, but rather was driven out of necessity because of the “extraordinary” conduct by social development minister Bathabile Dlamini and Sassa.
They put the entire system in jeopardy, the court said, and failed to show any interest in ensuring they fulfilled their court-ordered mandate to ensure that a new system was in place to take over the grants payments come 1 April 2017.
“In most shaming of ironies, government now reliant on private company to get itself out of this predicament,” the court said.
“The sole reason for this litigation is because of (Sassa and Minister Dlamini’s) failure to keep its promises to the court.”
Dlamini, the department of social development and Sassa failed to have a plan in place to take over the payments of grants by 31 March as ordered by the Constitutional Court in 2014, after it entered into an illegal and invalid contract with Net1 CSP in 2012.
The court said that Dlamini showed no interest in resolving the problem, even when warned, and failed to inform the court about any progress on the process.
Dlamini carries the full responsibility to ensure that Sassa fulfills its functions, and will need to her explain her conduct at a later date, it said.
The ConCourt was effectively pushed into a corner through government’s failure, left with little choice in the matter – it either had to allow the same behaviour it had previously ruled to be illegal, or uphold its position and set up 17 million South Africans to miss their grants payment.
Sassa will have to run a tight ship, audit CPS’s finances and ensure that beneficiaries’ personal data is protected. The agency must also report back to the Constitutional Court every three months with evaluations on the process to find a new service provider, or taking the grants payments in-house.
Read: This is how much more money CPS wants for its new 2 year social grants contract
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