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Corruption Watch (CW) condemns a decision by the South African Social Services Agency (SASSA) to withdraw from opposition to legal action that challenged a R317-million payment to social grants distributor Cash Paymaster Services (CPS) on the basis that it was irregular. CW views the conduct as wasteful of public resources, following two years of litigation on the matter.

In March 2015 CW launched an application in the North Gauteng High Court, to review and set aside the decision of the former CEO of SASSA, Virginia Petersen, to pay R317-million to CPS, the service provider responsible for the distribution of social grants.

Corruption Watch’s review was premised on evidence which, in the organisation’s view, clearly showed that the decision to make the payment was unlawful and irrational. CW requested the court to set aside the decision and to order CPS to pay back the money.

Despite SASSA’s defence of CW’s application since early 2015, the agency has now, two years later, chosen to file a notice of withdrawal of opposition to the review application and to tender all costs related to their opposition. SASSA has therefore incurred legal costs in respect of this matter for two years, only to withdraw their opposition just months away from the hearing of the matter. Although a date for the start of the hearing had not yet been set, CW was advised by the court that the matter was likely to commence in the next few months.

CW has written to SASSA to request reasons for withdrawing its opposition to the review application and if SASSA fails to do so, Corruption Watch will seek to hold both former and current officials of the agency, who are directly linked to the matter, personally liable for the costs of the application.

Corruption Watch has also written to the Standing Committee on Public Accounts (Scopa) in Parliament to request that it enquire into SASSA’s flagrant abuse of state resources.

David Lewis, executive director of Corruption Watch, commented: “Over the past two years SASSA’s defence of our action has given rise to hundreds of thousands of rands of taxpayers’ money wasted on legal costs. CW considers SASSA’s pursuit of the matter to date as a flagrant abuse of public resources and one more example of the state’s willingness to abuse taxpayer’s money by engaging in costly and fruitless litigation. We have asked SASSA to provide reasons for their withdrawal. We have received no response, further confirming our long-held view that this should never have been defended in the first place. We will ask the court to order the officials responsible for deciding to defend this action, to pay costs out of their own pocket.”

Read our letter to SASSA.

Read our letter to Scopa.

Read SASSA’s notice of withdrawal.

Moira Campbell       Cell: 083 995 4711             E-mail:
Valencia Talane       Cell: 072 366 4968             E-mail: