Black Sash applauds Corruption Watch’s court victory against CPS.

2 October 2019

This week, the Supreme Court of Appeal (SCA) dismissed the appeal lodged by Cash Paymaster Services (CPS), contesting a previous Pretoria High Court ruling that ordered it to pay back R316 million to South Africa Social Security Agency (SASSA). The Black Sash applauds Corruption Watch for their efforts.

Corruption Watch argued last year in the High Court that the re-registration of beneficiaries was included in the RFP, contract and the Service Level Agreement concluded between the parties. No separate agreement or payment was therefore necessary.

After being unable to appeal the High Court ruling, CPS turned to the Supreme Court of Appeal.  It contested that it would be unreasonable to pay the disputed R316 million to SASSA, and argued that its initial contract with SASSA excluded the registration of children.

In handing down judgement, the SCA confirmed that there was no lawful basis for the variation agreement between SASSA and CPS. Stating “the most concerning issues was that for the first time it appeared that CPS was aware the beneficiaries included children. Therefore there could not have been a variation agreement to include children when they had been included all along.”

The SCA concurred with the judgement of High Court Judge J Tsoka that the deviation from the Service Level Agreement (SLA) was contrary to SASSA’s own supply-chain management policy and procedures.  The payment to CPS was effected for an “ulterior purpose or motive”, and that there was no legal basis for SASSA to pay CPS for the registration of social grant beneficiaries. The Court found that CPS has acted in a contrived and opportunistic manner.

Lynette Maart, Director of the Black Sash, says; “This judgement is a step in the right direction in dealing with corruption in SASSA but more importantly in government departments and agencies. Judge Tsoka found that Ms Virginia Peterson, former CEO of SASSA, unilaterally varied the SLA and that the payment to CPS was not rationally connected with the purpose for it was made.  Those responsible for perpetrating corruption must be held accountable for their actions.”

Last year, the High Court ordered CPS to pay back the full amount of R316 million, with interest, to SASSA.  Added to this CPS will now also have to pay the legal costs of Corruption Watch, including the costs of two counsel.

Issued by Angie Richardson, Media Relations, 2 October 2019