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Pretoria - The Department of Social Development wants the current system of paying social grants to be overhauled and run internally.
Minster Bathabile Dlamini on Monday unveiled a 10-member committee to look into problems relating to grant payments.
Announcing the committee at Falala Community Hall in Soshanguve, Dlamini said the South African Social Security Agency (Sassa) would not renew the R10 billion contract with service provider Cash Paymaster Services. Its five-year contract expires in March 2017.
She said when the contract ended, the department would run the payments in-house.
Before Sassa was set up, the administration and payment of social grants was the responsibility of the provinces, the minister said.
“This state of affairs resulted in a fragmentation of services, rampant fraud within the system and obvious lack of norms and standards in the administration and payment of social grants. Payment of social grants was outsourced to various payment contractors in the nine provinces,” she said.
Sassa was established in 2006, but the different payment methods continued until Cash Paymaster Services was appointed.
Pensioners at one paypoint said one of the biggest problems was that they were sold items at inflated prices at some shops from which they got their money, and they were also targeted by loan sharks.
Dlamini said: “We have to look into a system that protects our elderly from loan sharks. No one must ask them to buy groceries or get less money than they have in their cards. They need to know that when they go to the bank, there are bank charges as well.”
The 10-member committee, led by Advocate Themba Langa, has 18 months in which to review the system and give the minister recommendations. There are about 16 million social grant recipients, with 11 million of them getting the child support grant.
Langa said: “I think the current system is in a critical condition and it needs to be reviewed. We will look at how to make the system more efficient and cost effective. One of the biggest problems is that this system does not protect the elderly from loan sharks. We have to come up with ways to change that.”
Dlamini said the grants did not always have to be paid in cash. “By the time the committee is done with their work, technology would have progressed. We do not have to give everyone money. In some countries, the people are given vouchers and it is already programmed as to what the recipients can buy.
“This means that you cannot go and use the money to do your hair or go to the tavern.”
Since May last year, Sassa has been enrolling beneficiaries on a biometric system. It includes finger and palm verification and voice recognition and is aimed at reducing fraud. Beneficiaries are being issued smart cards with which they can withdraw money from selected shops and ATMs.
“The report for the committee will cover various options for immediate implementation, viability and implications of options considered,” she said.