- The Pretoria High Court has ordered CPS to pay Sassa R317 million back
- The court ordered CPS to pay interest on the amount dating back to June 2014 and to pay the legal costs of the application as well.
- The court found the decisions taken by Sassa, in favour of CPS, was unlawful
The Pretoria High Court has found that two decisions taken by Sassa, which favoured its controversial service provider, are unlawful.
Cash Paymaster Services (CPS) has been ordered by the court to pay back more than R317 million to the South African Social Services Agency (Sassa) ”for the benefit of those for whom it was intended in the first place”.
On Friday, Judge Moroa Tsoka ruled in favour of Corruption Watch (CR). CR took Sassa to court over its decision in 2012 to vary its contract with CPS about the costs of re-registering South Africa’s social grant beneficiaries, as well as Sassa CEO, Virginia Pepterson’s 2014 decision to pay CPA an additional R317 million. The watch claimed this was unlawful.
Briefly.co.za gathered that the variation resulted in the cost of re-registration rising from the initially agreed all-inclusive cost of R16.55 per beneficiary to R23.20 per re-registration.
The Citizen reported that the court ordered CPS to pay interest on the amount dating back to June 2014 and to pay the legal costs of the application as well.
Early last year, Sassa withdrew its opposition to the application after it initially defended its position.
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In 2012, Sassa enlisted CPS to distribute social welfare grants on its behalf.
However, in 2013, the Constitutional Court set aside the award of the tender as unlawful. Then, in 2014, the court ordered Sassa to initiate a new tender process. To date no new tender has been awarded.
It's been reported that Judge Tsoka found Sassa’s Bid Adjudication Committee did not authorise the variation agreement. It also found that the approval in 2014 after the services had already been rendered made it unlawful.
Meanwhile, CPS was adamant there was nothing sinister about the variation of the contract as its initial price was based on re-registering more than nine million adult beneficiaries, but did not make provision for the re-registration of about 12 million children.
But, the judge said the parties never actually agreed on a suitable price. Judge Tsoka said children were included in the term beneficiaries and the process was screwed in favour of CPS.
“It was unfair, inevitable, opaque, anti-competitive and, probably, not cost-effective. As a result of Sassa’s unlawful conduct, the fiscus has been robbed of a substantial amount of money intended for the most vulnerable and poor people in our country. The fiscus is poorer as it did not receive fair value for what it paid.
“It is just and equitable that the payment of R316 447 361.41 made by Sassa to CPS, together with interest, be returned to the fiscus for the benefit of those for whom it was intended in the first place,” he said.