No plan to reissue SA grants tender

Johannesburg - There is no plan to reissue a R10bn social grants tender after it ends in 2017, says the South African Social Security Agency (Sassa).

In 2012, Cash Paymaster Services (CPS), a division of Johannesburg Stock Exchange (JSE) listed Net1 UEPS Technologies [JSE:NT1], won the Sassa tender to distribute grant payments to over 10 million recipients.

But in April 2014, the Constitutional Court ordered Sassa to reissue the tender as Justice Johan Froneman criticised the agency for its “irregular” conduct regarding awarding the contract to CPS.

The Constitutional Court subsequently ordered Sassa to reissue the tender by October 2015. However, the tender was not awarded in October as Sassa said “the bids were non-responsive in mandatory administrative functionality which is a key consideration in evaluating a tender”. As a result, CPS is expected to hang on to the contract until its expiry in 2017.

However, Sassa’s spokesperson Kgomoco Diseko confirmed to Fin24 that the agency plans to take over the social grants distribution by 2017 and not re-issue the tender.

“Sassa does not intend to go on payment tender again and it is currently putting all its efforts on getting ready to take over the distribution of social grants when the current contract ends,” Diseko told Fin24.

In a filing to the Constitutional Court this week to explain the decision not to award the tender, Sassa also explained that the plan has always been for it to “take over the control, administration and management of payment of the social grants by 2017 when the contract with CPS expires”.

“However, the finding of invalidity of the award of the tender to CPS and the new tender process ordered by this Court had the effect of re-directing Sassa’s immediate focus and resources to the running and completion of the new tender process,” said Sassa in the filing.

“Subsequent to the decision not to award, Sassa is now in a position to again direct its focus on taking over the payment of social grants,” said Sassa.

Phased approach

Sassa, in its court filing, said it originally planned to take responsibility for payment of social grants in a five phased approach.

In the filing to the Constitutional Court, Sassa said it had already completed phase one which took place during 2012-2014 and involved the centralisation and improvement of the integrity of data in the collection of biometric information.

Meanwhile, the company said that phase two - which has involved taking over the ongoing enrolment process between 2014 and 2015 - requires the agency to procure its own hardware and software for biometric enrolment and verification. Sassa also said it’s advertised a tender for biometric identity and access management for its system users.

In addition, the third phases of developing Sassa’s in-house capability to manage payments and reconciliation has not yet started. This phase was set to start in 2013 and end in 2016.

Sassa also outlined an original plan (phase four) to pilot the new grants system in 2016 and (phase five) roll it out in 2017.

In addition, Sassa has now put forward seven deliverables over that it needs to meet by March 2017 which ranges from integration of systems through a web-based application, cash distribution and security thereof and card issuance.

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