Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News
      Vodacom's Safaricom deal struck down by Kenyan high court

      Vodacom’s Safaricom deal struck down by Kenyan high court

      15 September 2026
      Customers of 45 insurers exposed in South African cyberattack

      Customers of 45 insurers exposed in South African cyber breach

      15 September 2026
      What Revolut can and cannot take from South Africa's banks

      What Revolut can and cannot take from South Africa’s banks

      15 September 2026
      Nvidia-backed chip designer pushes deeper into flagship phones - MediaTek Dimensity 9600 Pro

      Nvidia-backed chip designer pushes deeper into flagship phones

      15 September 2026
      Saps bodycam tender collides with Popia's biometrics rules

      Saps bodycam tender collides with Popia’s biometrics rules

      15 September 2026
    • World
      'This is not circular': Jensen Huang defends $3.5-billion MediaTek deal

      ‘This is not circular’: Jensen Huang defends $3.5-billion MediaTek deal

      2 September 2026
      AI-generated music banned from Australian charts

      AI-generated music banned from Australian charts

      26 August 2026
      Traders brace for a R4.5-trillion swing in Nvidia's value

      Traders brace for a R4.5-trillion swing in Nvidia’s value

      25 August 2026
      Russia building its own Starlink - and faster than expected - Vadym Skibitskyi

      Russia building its own Starlink – and faster than expected

      11 August 2026
      Meta AI will now tell parents if their teen is in crisis

      Meta AI will now tell parents if their teen is in crisis

      17 July 2026
    • In-depth
      Google DeepMind CEO Demis Hassabis. Image: John Sears

      The plan to stop AI from breaking the world

      16 July 2026
      The internet has a Strait of Hormuz problem

      The internet has a Strait of Hormuz problem

      15 July 2026
      AI boom sparks rally, frenzy and fear

      AI boom sparks rally, frenzy and fear

      11 June 2026
      Every plug-in hybrid on sale in South Africa, ranked by price - Lamborghini Temerario

      Every plug-in hybrid on sale in South Africa, ranked by price

      7 June 2026
      What Wi-Fi 8 will mean for wireless networks

      What Wi-Fi 8 will mean for wireless networks

      1 June 2026
    • TCS
      Meet the CIO | Shoprite's Chris Shortt on what a supermarket becomes

      Meet the CIO | Shoprite’s Chris Shortt on what a supermarket becomes

      9 September 2026
      Rubicon's EV charging network is profitable - and growing fast - Watts & Wheels

      Rubicon’s EV charging network is profitable – and growing fast

      8 September 2026
      Winstone Jordaan on building a national EV charging network

      Winstone Jordaan on building a national EV charging network

      2 September 2026
      Watts & Wheels S1E8: 'Tesla lands in Africa, just not here'

      Watts & Wheels S1E8: ‘Tesla lands in Africa, just not here’

      24 August 2026
      TCS | Herotel CEO Van Zyl Botha on beating Starlink to South Africa

      TCS | Herotel CEO Van Zyl Botha on beating Starlink to South Africa

      14 August 2026
    • Opinion
      The end is nigh, and the shares go on sale in October - Duncan McLeod

      The end is nigh, and the shares go on sale in October

      14 September 2026
      The fragile joint in the Capitec machine - Pambos Soteriades

      The R197-billion market the banks can’t reach

      25 August 2026
      South African tech's compounding debt problem - Jannie van Zyl

      Management consulting as we know it is over

      21 August 2026
      South African tech's compounding debt problem - Jannie van Zyl

      The most dangerous customer is the quiet one

      10 August 2026
      South African tech's compounding debt problem - Jannie van Zyl

      South African tech’s compounding debt problem

      29 July 2026
    • Company Hubs
      • 1Stream
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • Ascent Technology
      • AvertITD
      • BBD
      • Braintree
      • CallMiner
      • CambriLearn
      • CM.com
      • Contactable
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • HOSTAFRICA
      • Incredible Business
      • iONLINE
      • IQbusiness
      • Iris Network Systems
      • Kaspersky
      • LSD Open
      • Mitel
      • NEC XON
      • Netstar
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Telviva
      • Tenable
      • Vertiv
      • Videri Digital
      • Vodacom Business
      • Vox
      • Wipro
      • Workday
      • XLink
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Financial services
      • HealthTech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Policy and regulation
      • Public sector
      • Retail and e-commerce
      • Satellite communications
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
      • Watts & Wheels
    • Events
    • Advertise
    TechCentralTechCentral
    Home » In-depth » Grants tender ruling damns state agency

    Grants tender ruling damns state agency

    By Craig McKune25 April 2014
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    Get breaking news on WhatsApp

    Social services minister Bathabile Dlamini
    Social development minister Bathabile Dlamini

    If you listened only to social development ­minister ­Bathabile Dlamini and the South African Social Security Agency (Sassa), you might believe that last week’s ­constitutional court judgment vindicated the agency.

    Rather, Sassa should be seriously embarrassed, and the judgment should give rise to grave concern about how the agency is being run.

    In two judgments — the first delivered in November, the second last week — the court ruled that a R10bn contract awarded to Cash Paymaster Services (CPS) is constitutionally invalid, and that the agency must rerun the tender.

    The contract outsources the payment of social grants for about 16m South Africans. To ensure that payments are not disrupted, the court suspended its declaration of invalidity until after the new tender process.

    CPS won its contract early in 2012, but was immediately challenged in the high court in Pretoria by losing bidder AllPay.

    AllPay lost on appeal, but the constitutional court’s ­“merits” judgment in November found that the tender process was invalid. Last week’s judgment ruled on how the wrongdoing should be remedied.

    Far from vindicating the agency, the court’s decision demonstrates its lack of confidence in Sassa’s bona fides.

    Authored by judge Johan Froneman, the order directs that the court effectively hold Sassa’s hand throughout the new tender: Sassa must publicly report back to court at crucial stages.

    The court will release its grip on the agency’s arm only when it comes to the final decision: whether to award a contract and to whom it should be awarded is up to Sassa.

    If the agency decides not to award a contract, it has two weeks to tell the court whether and when it can take over grant payments.

    CPS, the court concluded, “has no right to benefit from an unlawful contract”, so if Sassa does not award the new tender, the company must publicly file its audited financial statements for the contract, and Sassa must independently and ­publicly verify these.

    This is known as a “structural interdict”, when a court imposes a supervisory role on the government.

    The judges appear to have grappled with an unusual problem: how should a court act when it cannot be taken for granted that the government will act in good faith?

    Froneman said that because millions rely on grants, there is obvious public interest “in ensuring that the tender is rerun properly”.

    Implying that the court was not confident Sassa could achieve this, he said “disciplined accountability” would be needed for the new tender, which “needs to be monitored”.

    Sternly, Froneman then turned to the agency’s role: “Sassa’s irregular conduct has been the sole cause for the declaration of invalidity, and for the setting aside of the contract.”

    He said Sassa’s stance was “unhelpful and almost obstructionist”, and that it had failed to provide crucial information to AllPay and to outline the steps it took to investigate irregularities.

    “Its conduct must be deprecated, particularly in view of the important role it plays as guardian of the right to social security and as controller of beneficiaries’ access to social assistance.”

    In denial?
    Far away on planet Sassa, however, the mood was jubilant.

    On Twitter, Dlamini’s spokesman, Lumka Oliphant, said of her principal: “She keeps winning!” To this she added: “No disruption means business as usual at Sassa. 1 ­– Sassa, 0 — AllPay.”

    Dlamini seemed similarly pleased: “Oh Lumka, I slept for only an hour. Can you imagine 16m people without food? The order of no ­disruption of grants is the best.”

    A more sober statement on a department letterhead said: “This is a judgment that is on the side of the poor. The understanding and the emphasis by the highest court of the land that there should be no disruption in the disbursement of social grants is of utmost importance to the department.”

    In reality, all parties before the court had agreed that at as a minimum, the court-ordered solution must ensure that grant payments were not interrupted.

    At issue was whether or not the agency had run a regular and fair process. It had not, the court found.

    Some of the technology deployed by Cash Paymaster Services
    Some of the technology deployed by Cash Paymaster Services

    Asked by Talk Radio 702 host John Robbie if this was “a big defeat for Sassa”, the agency’s CEO, Virginia Petersen, was undaunted: “No, it isn’t a defeat. I think the thing that would have worried me [is if] it wasn’t legal. ‘Constitutional invalidity’ means there were infractions in the process that required correction.”

    These infractions, according to the court, were twofold. The first was that Sassa failed properly to interrogate the role of CPS’s purported empowerment partners.

    Froneman was scathing: “It is difficult to think of a more fundamentally mandatory and material condition prescribed by the constitutional and legislative procurement framework than objectively determined empowerment credentials.”

    Sassa’s second infraction was its 11th-hour notice to bidders, which stipulated the requirement of the provision of biometric verification technology for payments. In earlier bid documents, it was a preference.

    Only CPS included it in its bid. Froneman found that the notice had “knocked AllPay out of contention”, making the process entirely uncompetitive.

    Oliphant and Petersen raised another straw effigy: corruption, and the lack of any finding on this.

    Oliphant, for example, told her Twitter followers that the judgment specified “no finding of fraud or corruption”. In fact, the court concluded no such thing.

    Throughout 2012, there were various reports and allegations of possible tender malfeasance. AllPay presented some of them to the high court, but ultimately it backed down, focusing instead on the strong evidence of tender irregularity.

    For that reason, the constitutional court did not deliberate on the issue, save for rejecting AllPay’s last-ditch attempt to introduce hearsay evidence early this year.

    But in the US, where CPS’s parent company, Net 1 UEPS, is listed, the Securities and Exchange Commission and department of justice are still investigating, while the company faces two class action suits from US investors who claim it “failed to disclose that [its] practices to secure contracts in South Africa were in violation of the Foreign Corrupt Practices Act”.

    Public protector Thuli Madonsela’s office confirmed this week that it is also still investigating alleged bribery, and South African campaign group Corruption Watch said it will ask the police to investigate graft allegations and is considering the option of launching a ­private criminal prosecution.  — (c) 2014 Mail & Guardian

    • Visit the Mail & Guardian Online, the smart news source
    Add TechCentral as a preferred source on GoogleFollow TechCentral on Google NewsGet breaking news on WhatsApp


    AllPay Bathabile Dlamini Cash Paymaster Services CPS Net1 Net1 UEPS Net1 UEPS Technologies Sassa Virginia Petersen
    WhatsApp YouTube
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleDA using Mxit game to snag votes
    Next Article How to turbo-charge Africa’s Internet

    Related Posts

    fingerprint

    Fingerprints, facial scans now mandatory for Sassa grants

    27 August 2025

    Compulsory biometric tests for some Sassa beneficiaries

    24 April 2025
    fraud

    How South Africa’s social grants system was defrauded on a massive scale

    6 January 2025
    Company News
    Asus ExpertBook P5 G2 packs AI performance into a 1.27kg laptop

    ASUS ExpertBook P5 G2 packs AI performance into a 1.27kg laptop

    15 September 2026
    Inside the 2026 Rising Star judging week

    Inside the 2026 Rising Star judging week

    15 September 2026
    SA20 launches schools derby series with rain as title sponsor

    SA20 launches schools derby series with rain as title sponsor

    14 September 2026
    Opinion
    The end is nigh, and the shares go on sale in October - Duncan McLeod

    The end is nigh, and the shares go on sale in October

    14 September 2026
    The fragile joint in the Capitec machine - Pambos Soteriades

    The R197-billion market the banks can’t reach

    25 August 2026
    South African tech's compounding debt problem - Jannie van Zyl

    Management consulting as we know it is over

    21 August 2026

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Latest Posts
    Vodacom's Safaricom deal struck down by Kenyan high court

    Vodacom’s Safaricom deal struck down by Kenyan high court

    15 September 2026
    Customers of 45 insurers exposed in South African cyberattack

    Customers of 45 insurers exposed in South African cyber breach

    15 September 2026
    What Revolut can and cannot take from South Africa's banks

    What Revolut can and cannot take from South Africa’s banks

    15 September 2026
    Nvidia-backed chip designer pushes deeper into flagship phones - MediaTek Dimensity 9600 Pro

    Nvidia-backed chip designer pushes deeper into flagship phones

    15 September 2026
    © 2009 - 2026 NewsCentral Media
    Built and maintained by Chronon
    • Cookie policy (ZA)
    • TechCentral – privacy and Popia

    Type above and press Enter to search. Press Esc to cancel.

    Manage consent

    TechCentral uses cookies to enhance its offerings. Consenting to these technologies allows us to serve you better. Not consenting or withdrawing consent may adversely affect certain features and functions of the website.

    Functional Always active
    The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
    Preferences
    The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
    Statistics
    The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
    Marketing
    The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
    • Manage options
    • Manage services
    • Manage {vendor_count} vendors
    • Read more about these purposes
    View preferences
    • {title}
    • {title}
    • {title}