CPS says it's not being paid to pay social grants in cash

The company says it's going concern status is under threat, because it's not being paid for its service to pay social grants in cash.

A Sassa card. Picture: Supplied

CAPE TOWN – The South African Social Security Agency (Sassa)'s troubled relationship with controversial service provider Cash Paymaster Services (CPS) has taken another bad turn.

The company says it's going concern status is under threat, because it's not being paid for its service to pay social grants in cash.

CPS says it only has enough cash reserves to last until the end of May.

The company has now approached the Constitutional Court to break the impasse over how much it may charge for its services.

In papers filed with the court this week, CPS chief executive Herman Kotze says the dispute over what it may charge, has meant that his company has been unable to invoice for its services, and has thus not been paid.

Treasury has made recommendations to the court on what it thinks CPS should be paid, but the company says it will suffer operating losses of more than R111 million a month if it agrees to their proposals.

CPS says Treasury's proposal for the enrollment of new beneficiaries is also too little and would result in losses of more than R2.3 million for April and May.

As Sassa transitions its payment options to the Post Office, CPS says it will continue to bleed money, because it's required to keep all 10,000 pay points operational and pay the same number of staff to manage them.

It now wants the court to direct Treasury to allow a minimum monthly payment to CPS for its cash payment service.

(Edited by Thapelo Lekabe)