Johannesburg - South Africa’s top court ordered the
government and the nation’s welfare agency to explain how a crisis that’s
threatening welfare-grant payments to more than 17 million people came about
and what’s been done to fix the problem.
In 2012, the state contracted Net1 UEPS Technologies to
distribute the grants for five years. Two years later, the Constitutional Court
ruled that its appointment was illegal. The company continued making the
payments after the welfare agency failed to appoint a replacement. It’s now set
to get a new contract in an apparent contravention of the court order and
against the advice of the Treasury and central bank.
In papers filed Wednesday, the court asked who at the
welfare agency decided it was incapable of paying out the monthly stipends
itself, when the decision was taken and why the court wasn’t notified. It also
asked whether the state agency has concluded a new disbursement contract with
Net1’s Cash Paymaster Services unit and, if so, to provide it with all details.
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The government and welfare agency have argued that Net1
is the only entity with the capacity to ensure that payment of the grants
continues uninterrupted. The Black Sash Trust, a human-rights group, has asked
the court to rule that it oversee any new contract the welfare agency signs
with Net1.
The court on Wednesday rejected an application by the
Democratic Alliance, the main opposition party, to join that case.