The SCA ruled against CPS on Monday (September 30), dismissing the company’s bid to get back over R316 million with interest from Sassa with costs. In the ruling, Judge of Appeal, Clive Plasket, says “there is no lawful basis for the variation agreement” between the applicants and Sassa.

Plasket says the then Sassa Chief Executive Officer (CEO), Virginia Petersen, and the applicant “CPS were incorrect in their assertions” that the original contract between the parties had to be altered, because it initially only required CPS to register over nine million recipients of social grants and not the indirect beneficiaries as well. Plasket also finds that the two parties were incorrect in claiming that CPS was entitled to payment over and above the fixed price. CPS not only loses the appeal, but they are ordered to cover the legal costs of the third respondent in the matter, being Corruption Watch.

In early September, CPS, represented by Advocate Alfred Cockrell, argued the additional function CPS had to perform for Sassa was not provided for in the agency’s request for proposal (RFP). This additional function is the registration and verification of eleven million indirect Sassa beneficiaries, specifically children, which forms the heart of the contentious matter between the parties. The children are referred to as indirect beneficiaries because money is collected on their behalf by a guardian/parent. CPS’ version is that the “penny only dropped” after the contract between the parties in question came into effect and it was discovered there were in fact over eleven million indirect beneficiaries that also had to be registered – in addition to more than nine million beneficiaries already registered. Cockrell was adamant his client was not going to make a profit unless the entire arrangement was amended.

Cockrell explained in earlier proceedings that the initial R16,44 was to be paid per month, per recipient for the entirety of CPS’ five-year contract. This amount covers the registration and verification of the beneficiaries as well as the service of paying out the grant money. The controversial fee of R23,20 was a once-off fee for the additional beneficiaries and was not intended to be paid monthly. This latter amount was meant to cover the hiring of people and transportation of those employees to go to the children’s homes and verify their details.

Sassa, on the other hand, represented by Advocate Nazeer Cassim in proceedings, refuted CPS’ assertion that children were not included in the RFP, quoting a clause in the proposal to support this argument. This clause states: “for child support, foster child and care dependency grants, the successful bidder must ensure that biometrics and data relating to children is also captured”.

The third respondent in the matter, Corruption Watch, is expected to comment on the outcome soon. They contended the deal contravened the Promotion of Administrative Justice Act (PAJA) and the Supply Chain Management Policy.

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