The Constitutional Court today granted exceptional relief to avoid a crisis in paying social grants as from April 1, 2017 for 12 months. The Minister has also been asked to explain on oath why she should not be joined in her personal capacity and pay the costs of the proceedings. With regard to the protection of private information the ConCourt has protected that information with serious consequences for the financial institutions involved in the process of offering other services to recipients of such grants. The order appears below.
In particular there have to be adequate safeguards to ensure that personal data obtained in the payment process remains private. It may not be used for any purpose other than payment of the grants or any other purpose sanctioned by the Minister in terms of section 20(3) and (4) of the Social Assistance Act 13 of 2004. Everyone is precluded from inviting beneficiaries to “opt-in” to the sharing of confidential information for the marketing of goods and services.
See Also: Media summary: Minister for Social Development
Black Sash Trust v Minister of Social Development and Others (Freedom Under Law NPC Intervening) (CCT48/17) [2017] ZACC 8 (17 March 2017) per Froneman J (Mogoeng CJ, Nkabinde ADCJ, Cameron J, Jafta J, Khampepe J, Mhlantla J, Mojapelo AJ, Pretorius AJ and Zondo J concurring):
It is ordered that:
1 The Black Sash Trust is granted direct access to bring this application.
2 Freedom Under Law NPC is granted leave to intervene.
3 Corruption Watch NPC (RF) and the South African Post Office SOC Limited are admitted as friends of the Court.
4 It is declared that the South African Social Security Agency (SASSA) and Cash Paymaster Services (Pty) Limited (CPS) are under a constitutional obligation to ensure payment of social grants to grant beneficiaries from 1 April 2017 until an entity other than CPS is able to do so and that a failure to do so will infringe upon grant beneficiaries’ rights of access to social assistance under section 27(1)(c) of the Constitution.
5 The declaration of invalidity of the contract is further suspended for the 12-month period from 1 April 2017.
6 SASSA and CPS are directed to ensure payment of social grants to grant beneficiaries from 1 April 2017, for a period of 12 months, on the same terms and conditions as those in the current contract between them that will expire on 31 March 2017, subject to these further conditions:
6.1 The terms and conditions shall:
(a) contain adequate safeguards to ensure that personal data obtained in the payment process remains private and may not be used for any purpose other than payment of the grants or any other purpose sanctioned by the Minister in terms of section 20(3) and (4) of the Social Assistance Act 13 of 2004; and
(b) preclude anyone from inviting beneficiaries to “opt-in” to the sharing of confidential information for the marketing of goods and services.
6.2 CPS may in writing request National Treasury during the 12 month period to investigate and make a recommendation regarding the price in the contract.
6.3 National Treasury must file a report with this Court within 21 days of receipt of the request setting out its recommendation.
6.4 Within 30 days of the completion of the period of the contract, CPS must file with this Court an audited statement of the expenses incurred, the income received and the net profit earned under the contract.
6.5 SASSA must thereafter obtain an independent audited verification of the details provided by CPS under paragraph 6.4.
6.6 The audit verification must be approved by National Treasury and the audited verification must be filed by SASSA with this Court within 60 days.
6.7 CPS must permit the auditors appointed by SASSA to have unfettered access to its financial information for this purpose.
7 The Minister and SASSA must file reports on affidavit with this Court every three months, commencing on the date of this order, setting out how they plan to ensure the payment of social grants after the expiry of the 12-month period, what steps they have taken in that regard, what further steps they will take, and when they will take each future step, so as to ensure that the payment of all social grants is made when they fall due after the expiry of the 12-month period.
8 The reports filed by the Minister and SASSA as contemplated in paragraph 7 must include, but is not limited to, the applicable timeframes for the various deliverables which form part of the plan, whether the time-frames have been complied with, and if not, why that is the case and what will be done to remedy the situation.
9 If any material change arises in relation to circumstances referred to in a report referred to in paragraphs 7 or 8, the Minister and SASSA are required immediately to report on affidavit to the Court and to explain the reason for and consequences of the change.
10 It is declared that SASSA is under a duty to ensure that the payment method it determines:
10.1 contains adequate safeguards to ensure that personal data obtained in the payment process remains private and may not be used for any purpose other than payment of the grants or any other purpose sanctioned by the Minister in terms of section 20(3) and (4) of the Social Assistance Act; and
10.2 precludes a contracting party from inviting beneficiaries to “opt-in” to the sharing of confidential information for the marketing of goods and services.
11 The parties are, within 14 days from the date of this order, required to submit the names of individuals, with their written consent, suitably qualified for appointment as independent legal practitioners and technical experts for the purposes referred to in paragraph 12 below. 5
12 The Auditor-General and any other person(s) or institution(s) appointed by the Court after receipt of the names submitted under paragraph 11, shall jointly and until otherwise directed by the Court:
12.1 evaluate the implementation of payment of social grants during the 12-month period;
12.2 evaluate the steps envisaged or taken by SASSA for any competitive bidding process or processes aimed at the appointment by SASSA in terms of section 4(2)(a) of the South African Social Security Agency Act 9 of 2004 of a new contractor or contractors for the payment of social grants;
12.3 evaluate the steps envisaged or taken by SASSA aimed at SASSA itself administering and paying the grants in the future or SASSA itself permitting any part or parts of the administration and payment processes in the future; and
12.4 file reports on affidavit with this Court every three months, commencing on a date three months after the date of this order, or any shorter period as the legal practitioners and experts may deem necessary, setting out the steps they have taken to evaluate the matters referred to in paragraphs 12.1 to 12.3, the results of their evaluations and any recommendations they consider necessary.
13 The Minister is called upon to show cause on affidavit on or before Friday 31 March 2017 why—
13.1 she should not be joined in her personal capacity; and
13.2 she should not pay costs of the application from her own pocket.
14 Costs are reserved until conclusion of these proceedings.