SASSA announces successful social grant payment contractor
18 Jan 2012
The South African Social Security Agency (SASSA) wishes to announce the appointment of Cash Paymaster Services (Pty) Ltd as the new contractor for payment of social grants. The contract will run over a period of five years at a cost of approximately R10 billion, distributing grants to the value of approximately R500 billion over the same period (i.e. at approximately 2% cost).
SASSA issued a tender (i.e., Bid Number 01/11/BS) inviting service providers to submit proposals for the provision of payment services for social grants in the country for a period of five years.
The process was conducted in accordance with the Public Finance Management Act of 1999 (PFMA), and its regulations. A total of number of twenty-one companies submitted Bids for one or more of the provinces, resulting in 128 bids for evaluation. These bids were subjected to rigorous evaluation and adjudication in conformity with the bid document. This entailed a functionality evaluation in assessing each bid against the criteria, short-listing and financial and preference evaluation.
The Bid Committees were comprised mainly of most senior people in government, mainly at the level of Directors-General and/or Heads of departments. The processes followed by both Bid Committees was supported by appropriately skilled advisors, including legal, accountants and technology experts and were monitored by Independent Process Monitor.
The Chief Executive Officer (CEO) of SASSA together with the Directors-General (DGs) of the Departments of Social Development and the National Treasury received a presentation from the Bid Adjudication Committee; wherein the entire process was reviewed.
After consultation with the two DGs, and following due process in line with the South African Social Security Agency Act, 2004 (Act No. 9 of 2004) (SASSA Act), the CEO has decided to award the bid in conformity with the Bid Adjudication Committee's recommendation.
It is envisaged that SASSA will, through this contract, achieve its objective of standardising the services while allowing beneficiaries flexibility to be paid anywhere in the country.
This is the first time that SASSA awards a payment contract as previously it was extended based on the provincial contracts.
In the main, the bid outcome will achieve a realisable saving for SASSA. Over the past five years the unit costs for pension payment increased from approximately R26 in 2006/07 to R34 in 2010/11. In this contract, the unit cost has been capped to R16.50 for the duration of the contract. This would bring saving of R3 billion over a contract period of five years.
SASSA would like to express its gratitude to all bidders for the interest expressed in the proposal and wishes them well in their future endeavours. Recognition is also due to the Project Manager and all those who rendered invaluable assistance in achieving a successful bid.
Statement issued by Lumka Oliphant, South African Social Security Agency, January 18 2012
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