Registered users can save articles to their personal articles list. Login here or sign up here

Sassa CEO defends Post Office contract talks

Magwaza says he initiated back-up plan to pay welfare grants.

The head of South Africa’s welfare agency defended his decision to initiate talks with the Post Office as a contingency plan in case a contract to distribute grants with Cash Paymaster Services, a unit of Net 1 UEPS Technologies, couldn’t be extended by the deadline next month.  

“In terms of the law, I am allowed to negotiate with other government agencies. I have not done anything wrong,” Thokozani Magwaza, the chief executive officer of the South African Social Security Agency, said by phone on Tuesday. “As a CEO, I have to have a back-up plan in case something were to go wrong with the CPS contract.”

While the Constitutional Court ruled four years ago that the Net 1 contract was invalid because of the way it was awarded, the company has continued paying the grants after Sassa failed to appoint a replacement. The agency intends to conclude a new contract with Net 1 because no one else is capable of stepping in at short notice, Zodwa Mvulane, an official at the welfare agency, told lawmakers. Negotiations on the terms will begin on Wednesday, she said.

Magwaza said he was on sick leave, refuting a report by the Johannesburg-based Star newspaper that cited the Department of Social Development spokesman Lumka Oliphant as saying he had been suspended pending an investigation into allegations he sought to get the Post Office to distribute grants when the Net 1 contract expires. That would have been in conflict with the department’s plans.

“I am aware of no investigation,” Magwaza said. “The minister has not said anything to me on this issue. If I’m being investigated I should be told and if I’m suspended in terms of the labor act I should be told about that and nothing like that has happened. I’m just seeing it in the newspapers.”

Oliphant didn’t immediately respond to calls and text messages seeking comment.

© 2017 Bloomberg

Get access to Moneyweb's financial intelligence and support quality journalism for only
R63/month or R630/year.
Sign up here, cancel at any time.

COMMENTS   0

To comment, you must be registered and logged in.

LOGIN HERE

Don't have an account?
Sign up for FREE

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
Insider GOLD
ONLY R63pm

Moneyweb's premium subscription is a membership service which will give you access to a number of tools to take charge of your investments.
Or choose a yearly subscription at R630pa - SAVE R126

Get instant access to all our tools and content. Monthly subscription can be suspended at any time.

Podcasts

GO TO SHOP CART

Follow us:

Search Articles:Advanced Search
Click a Company:
server: 172.17.0.2