Cash Paymasters Services (CPS) has filed papers with the Constitutional Court, asking to be allowed to participate in future South African Social Security Agency (Sassa) tenders.
In an affidavit submitted to the Constitutional Court, dated February 6, CPS director Herman Kotze argues that the South African Social Security Agency misinterpreted the 2017 court order, which ruled that CPS's contract was invalid.
CPS is now seeking an interlocutory order from the Constitutional Court to change or clarify its order. The order extended Sassa's contract with CPS for an additional year, to allow the agency to find another service provider.
"I respectfully submit that Sassa has misread the March order. Properly understood, it does not preclude CPS's participation in any future tenders issued in relation to the payment of social grants," Kotze said.
Nothing in those orders suggested that CPS was precluded from participation in such a plan, he argued.
"Nor is there anything in the judgment to justify Sassa's interpretation of the judgment. The court did not criticise CPS or blame it for the social grants crisis."
Kotze said that Sassa interpreted the Constitutional Court order as rendering CPS ineligible to bid for, or be awarded, any role in the future provision of payment services.
"I submit that such preclusion was not sought from, or ordered by, this court," Kotze said.
The order, he said, instead stipulated for how long CPS's constitutional obligation would endure, "until an entity other than CPS is able to perform the payment services necessary to ensure that grant beneficiaries are paid".
"However, the termination of CPS's constitutional obligation would not mean that CPS has no right to bid to perform future services for Sassa," he said.
Sassa is currently asking the court to extend its contract with CPS for an additional six months.
Sassa said this would allow for a "phase-in-phase-out" period, which would allow the new service provider to progressively take more responsibility for payments, while CPS was still in the background. Sassa said it would manage this process.
Sassa acting CEO Pearl Bengu has said that 2.5-million of the agency's poorest benefactors do not have personal identification numbers to access grants through a national payment system.
She admits that Sassa has failed to migrate those beneficiaries to the national payment system within the court-allocated 12 months.
"The beneficiaries of these grants are in the main illiterate, the elderly and disabled beneficiaries. They constitute what is termed the 'unbanked' populace who rely on social grants, but regrettably cannot at this stage register with a financial institution," Bengu said.
Bengu also argues that the beneficiaries rely on payments being made physically at their location.
In 2014, the Constitutional Court ruled that Sassa's 2012 contract with CPS was illegal and invalid.
In April 2017, the court suspended the order of invalidity until March 31, 2018, to allow the social development department and Sassa time to find a new provider.