South Africa Panel Asks Treasury to Probe Welfare Agency

(Bloomberg) -- South Africa’s National Treasury should investigate the conduct of officials at the welfare agency and the Social Development department for possible prosecution, according to a panel appointed by the Constitutional Court.

It should probe all actions by the South Africa Social Security Agency since 2016 to issue contracts to service providers and all documents should be handed over without delay, the group which also includes the country’s auditor-general, said in court documents dated Nov. 16.

The nation’s top court is coordinating a process to bring in a new distributor of welfare payments to 17 million beneficiaries after it allowed for a one-year extension to a contract for Net1 UEPS Technologies Inc. that was found to be invalid in 2014 because tender procedures weren’t followed. The government has until April to find a new system to pay out more than 150 billion rand ($10.7 billion) in grants annually.

The panel also recommended that Sassa set up a system of direct payments into welfare-beneficiaries’s bank accounts from April “for the avoidance of a national crisis in respect of the payment of social grants.” The welfare agency should be instructed to provide the court with reasons why that isn’t feasible, it said.

Should Sassa fail to find an appropriate system in time, it could consider as a last resort, the extension of the agreement with Net1’s Cash Paymaster Services for up to six months and for cash pay points only, the panel said.

To contact the reporter on this story: Rene Vollgraaff in Johannesburg at rvollgraaff@bloomberg.net.

To contact the editors responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net, Gordon Bell

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