Social grants: The confusion continues

Despite several assurances from Social Development Minister Bathabile Dlamini there being 17 million South Africans dependent on government for social welfare grants and their pensions, the beleaguered minister has denied reports that a new contract has been reached to pay grants come April 1.

As things stand, there is no deal in place with any service provider to pay social grants.

On Tuesday, appearing before Parliament’s standing committee on public accounts (Scopa), Dlamini said certain aspects of the four terms of the contract still needed to be ironed out before a new deal could be reached with Cash Paymaster Services (CPS).

CPS has already said that there is a deal and it will be taking care of payments for at least another two years.

Here’s what we don’t know about the negotiated deal with CPS thus far:

• How much the new contract would cost per grant recipient (the current rate is R16.44 per recipient).
• What are the lawful deductions the new service provider would be allowed to process.
• Whether National Treasury supports the deal despite the current contract with CPS being found to be illegal by the Constitutional Court.

Here’s what we do know:

• The new contract will supposedly last for two years.
• The first year of the contract will focus on phasing out CPS from the grants distribution machine. While the second year will focus on implementing a new plan.
• The department of social development’s technical task team is said to be reviewing the terms of the new contract and will report back on Friday.
• The ministry will then announce the new deal with CPS.

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