The current debacle around whether or not the South

African Social Security Agency will be able to pay more than R140 billion out

in grants to more than 17 million welfare recipients shows up the fault lines

in our government.

This issue dates back to 2014 – that’s three years –

after the current contract with Net1 subsidiary Cash Paymaster Solutions (CPS)

was declared invalid by the Constitutional Court.

I remember following that case, and the initial awarding

of the R10 billion deal to CPS two years earlier, very closely when I was at

ITWeb.

When the Constitutional Court finally decided what to do

with the tender – after declaring it invalid in November 2013 – it ordered

SASSA to issue a new five-year tender.

However, it also ruled that, if the agency didn’t issue a

new tender, the current deal could be completed, subject to certain rules, I

reported at the time.

When a new tender was issued, later in 2014, Net1 went to

the Constitutional Court to have that declared invalid – because it was too vague.

It argued: “The tender specifications were not

sufficiently clear regarding a number of critical points and failed to comply

with the RFP [request for proposal] requirements specified in the court's

order".

That’s rather ironic, given that its initial tender was

declared invalid because SASSA didn’t ensure CPS’s empowerment credentials were

objectively confirmed, and the process wasn’t competitive enough – in simple

terms anyway, stripping out the legalese.

However, this sorry saga actually started two years

before the Constitutional Court ruling, when losing bidder Allpay – an ABSA

unit – went to court over the tender. It then dragged its way through the

quagmire that is our legal system and finally came to an end with the

publication of the new tender.

Or, so it seemed. The second tender was meant to close in

December 2014, but was then extended when the Constitutional Court – the

highest court in SA – in December directed SASSA to amend the tender, and send

it out again, ITWeb reported.

Then, in May 2015 – Net1 withdrew from the new tender process. And, the whole thing

seemingly ground to a halt.

Sudden flurry

Until December last year, when Bloomberg pointed out that the fate of 17 million people hung in the

balance because the initial tender – awarded in 2012 – was due to

expire at the end of the month.

And now suddenly, there’s a flurry of activity.

Now the Department of Social Development wants to extend

the deal. And then National Treasury got involved because there are rules

about spending government money.

And then there was another Constitutional Court battle, or two. And calls for Social

Development Minister Bathabile Dlamini’s head. And President Jacob Zuma calling

for calm.

And a flurry of back up plans: “the Post Office will

deliver”, “we’ll electronically deposit the money”, “we’ll truck in the money”

and “we promise we have a plan”.

It’s March 10. There’s a scant 21 days left in the month.

And in the meantime, 17 million people are panicking.

Worrying about what they will eat next month. How they will feed and clothe

their children. How they will educate their children.

And yet, there is no crisis.

And CPS staff are worried too – according to a caller

into 702 a while back. Because – I stand to be corrected – but apparently about

200 people’s jobs depend on the deal being extended.

And, in the meantime, Net1 is pocketing R16 for every

payment – a figure it wants to raise to, reportedly – between R22 and R25.

Although CEO Serge Belamant was asked by Bloomberg, and he said it would be

less than R25.

Sure, that’s not gross profit – and the company did spend

on implementing systems. But it’s scored an extra three years of 17 million

times R16 a month in revenue.

And how did this happen? Conspiracy theorists will

probably have a well-thought out answer to that, but I reckon it’s because the

department and its agency just didn’t do their job.

And now people will suffer for their ineptitude, and some

other company – perhaps even Net 1 – will rub their hands all the way to the

bank.

* Nicola Mawson is the online editor of Business

Report. Follow her on Twitter @NicolaMawson or Business Report @busrep.

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