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ConCourt extends Sassa's contract with CPS

Sassa approached the court last month requesting a six-month extension of its contract with CPS to disburse millions of social grants.

FILE: The Constitutional Court. Picture: EWN

JOHANNESBURG - The Constitutional Court has granted Sassa its request to continue with the services of Cash Paymaster Services (CPS) for six months.

Sassa filed an urgent application for the extension earlier this year, saying it wouldn’t be ready to take over social grant payments.

This is the second suspension Sassa has been granted since the highest court in the land ruled that the contract with CPS was invalid.

Sassa approached the Constitutional Court last month urgently requesting the extension of its contract with CPS.

Sassa said it wouldn’t have the capacity to pay the 2.5 million beneficiaries who are paid in cash with certain electronic services set to be taken over by the post office.

Justice Leona Theron granted the six-month extension.

Theron says the beneficiaries are to be paid on the same terms and conditions as those in the current contract.

CORRUPTION WATCH, CPS CASE

CPS will have to pay back R316 million it received from the Sassa almost four years ago.

CPS was paid the money to re-register beneficiaries.

But Corruption Watch challenged the payment in court, which has now found Sassa's conduct was unlawful.

The judgment by the North Gauteng High Court comes as the Constitutional Court has handed down its ruling on Friday afternoon, allowing CPS to continue with its services to Sassa for another six months.

Corruption Watch approached the court in 2015, arguing that it was unlawful for Sassa to make the payment to CPS, given that the Constitutional Court had already found the original contract to have been invalid.

Handing down judgment on Friday, the court said Sassa's decision to make the payment had robbed the fiscus of a substantial amount of money intended for the country’s poorest and most vulnerable people.

It also found that the fiscus did not receive value for money.

Corruption Watch's David Lewis said: “This demonstrates the importance of civil society taking action where this sort of illegal and unlawful conduct occurs.”

The court has ordered that CPS repay the money with interest from June 2014 and to pay costs in the matter.