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[2017] ZACC 8
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Black Sash Trust v Minister of Social Development and Others (Freedom Under Law NPC Intervening) (CCT48/17) [2017] ZACC 8; 2017 (5) BCLR 543 (CC); 2017 (3) SA 335 (CC) (17 March 2017)

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CONSTITUTIONAL
COURT OF SOUTH AFRICA
Case
CCT 48/17
In the matter
between:
BLACK
SASH
TRUST
Applicant
FREEDOM
UNDER LAW
NPC
Intervening
Party
and
MINISTER
OF SOCIAL
DEVELOPMENT
First
Respondent
CHIEF
EXECUTIVE OFFICER OF THE
SOUTH
AFRICAN SOCIAL SECURITY
AGENCY
Second
Respondent
SOUTH
AFRICAN SOCIAL SECURITY
AGENCY
Third
Respondent
MINISTER
OF
FINANCE
Fourth
Respondent
NATIONAL
TREASURY
Fifth
Respondent
CASH
PAYMASTER SERVICES (PTY)
LIMITED
Sixth
Respondent
INFORMATION
REGULATOR
Seventh
Respondent
and
CORRUPTION WATCH
(NPC)
RF
First
Amicus Curiae
SOUTH AFRICAN
POST OFFICE SOC LIMITED
Second
Amicus Curiae
Neutral
citation:
Black Sash Trust v Minister
of Social Development and Others
[2017] ZACC 8
Coram:
Mogoeng
CJ, Nkabinde ADCJ, Cameron J, Froneman J, Jafta J, Khampepe
J, Madlanga J, Mhlantla J, Mojapelo AJ, Pretorius AJ, and Zondo J
Judgments:
Froneman J (majority): [1] to [76]
Madlanga J (concurring): [77] to [81]
Heard
on:
15 March 2017
Decided
on:
17 March 2017
Summary:
social grants — judicial supervision — direct access
— section 172 — just and equitable remedy —
continuing
constitutional obligation —
AllPay 1 —
AllPay 2
ORDER
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

time-frames 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.
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.
JUDGMENT
FRONEMAN J (Mogoeng
CJ, Nkabinde ADCJ, Cameron J, Jafta J, Khampepe J, Mhlantla J,
Mojapelo AJ, Pretorius AJ and Zondo J concurring):
Introduction
[1] One of the
signature achievements of our constitutional democracy is the
establishment of an inclusive and effective programme
of social
assistance.  It has had a material impact in reducing poverty
and inequality and in mitigating the consequences
of high levels of
unemployment.
[1]
In so doing it has given some content to the core
constitutional values of dignity, equality and freedom.
[2]
This judgment is, however, not an occasion to celebrate this
achievement.  To the contrary, it is necessitated by the

extraordinary conduct of the Minister of Social Development
(Minister) and of the South African Social Security Agency (SASSA)
[3]
that have placed that achievement in jeopardy.  How did this
come about?
[2] The Constitution
provides that everyone has the right to have access to social
security, which includes, if they are unable
to support themselves
and their dependants, appropriate social assistance.
[4]
In terms of its obligations to take reasonable legislative and other
measures, within its available resources, to achieve
the progressive
realisation of this right,
[5]
Parliament enacted the
Social Assistance Act
[6
]
which makes provision for various forms of social grants.
[7]
The South African Social Security Act
[8]
(SASSA Act) provided for the establishment of SASSA as an agent for
the administration and payment of social assistance.
[9]
The Chief Executive Officer (CEO) of SASSA is responsible, subject to
the direction of the Minister, for the management of
SASSA.
[10]
SASSA may with the concurrence of the Minister enter into an
agreement with any person to ensure effective payments to grant

beneficiaries.
[11]
[3] On 3 February
2012 SASSA concluded a contract with Cash Paymaster Services (Pty)
Limited (CPS) to provide services for the payment
of social grants
for a period of five years.  On 29 September 2013 this Court
held that the award of the tender to provide
services for payment of
social grants to CPS was constitutionally invalid (
AllPay 1
).
[12]
In the remedial order (
AllPay 2
)
[13]
the Court suspended the declaration of invalidity.  The
declaration was based on the premise that either a new five-year
tender would be awarded after a proper procurement process or SASSA
would itself take over the payment of social grants when the

suspended contract with CPS came to an end on 31 March 2017.  SASSA
was ordered to report to the Court on progress in respect
of the new
tender process and its outcome.  In November 2015 SASSA finally
reported that it had decided not to award a new
tender, it would
itself take over the payment of social grants and it would be able to
meet the deadline of 31 March 2017.
[4] On accepting
this assurance the Court discharged its supervisory order.
[5] But this
assurance turned out to be without foundation.
[6] Since April 2016
the responsible functionaries of SASSA have been aware that it could
not comply with the undertaking to the
Court that it would be able to
pay social grants from 1 April 2017.  The Minister says she was
informed of this only in October
2016.  There is no indication
on the papers that she showed any interest in SASSA’s progress
before that.  Despite
repeated warnings from advising counsel
and CPS,
[14]
neither SASSA nor the Minister took any steps to inform the Court of
the problems they were experiencing.  Nor did they see
fit to
approach the Court for authorisation to regularise the situation.
[7] The Minister and
SASSA tell us that CPS is the only entity capable of paying grants
for the foreseeable future after 31 March
2017.
[8] This Court and
the country as a whole are now confronted with a situation where the
executive arm of government admits that
it is not able to fulfil its
constitutional and statutory obligations to provide for the social
assistance of its people.
And, in the deepest and most shaming
of ironies, it now seeks to rely on a private corporate entity, with
no discernible commitment
to transformative empowerment in its own
management structures,
[15]
to get it out of this predicament.
[9] It is necessary
to stand back for a moment to reflect on the significance of the
Court’s acceptance of SASSA’s assurance
that it was
capable of making payment of social grants after 31 March 2017.
[10] In a
constitutional democracy like ours, it is inevitable that at times
tension will arise between the different arms of government
when a
potential intrusion into the domain of another is at stake.  It
is at times like these that courts tread cautiously
to preserve the
comity between the judicial branch of government and the other
branches of government.
[16]
But there was no constitutional tension about social grants in
November 2015.  There was no legitimate reason for the
Court not
to accept the assurance of an organ of state, SASSA, under the
guidance of the responsible Minister, that it would be
able to fulfil
an executive and administrative function allotted to it in terms of
the Constitution and applicable legislation.
There was no
threatened infringement to people’s social assistance rights
and no suggestion that the foundation of
the Court’s remedial
order would be disregarded.  Now there is.
[11] SASSA will not
be able to take over the payment of social grants by 1 April 2017
and may not be able to do so for
some time to come.  It intends
to enter into a contract with CPS without a competitive tender
process as required by section 217
of the Constitution
[17]
in order to continue the payment of social grants.  In so doing
it has walked away from the two fundamental pillars of this
Court’s
remedial order in
AllPay 2
.  That is serious enough, but
it has also broken the promise in its assurance to this Court in
November 2015, that it would
take over the payment of social grants
by 31 March 2017, which formed the basis of the withdrawal of
the supervisory order.
[12] To make matters
worse, the Minister and SASSA did not deign to inform the Court of
these developments until 28 February 2017
when SASSA and its CEO
launched an application on an urgent basis for an order authorising
it to take further steps to ensure payment
of social grants from 1
April 2017.  In an unexpected about-turn, SASSA sought to
withdraw that application the next day.
[18]
On 3 March 2017 it filed a “follow-up report” with
limited information on how this had arisen and what might
happen in
the future.  The Court issued directions in response to this
report.  An answer of sorts was received only
just the day
before the hearing.
[13] Until the
forced reply to this Court’s directions there has certainly
been no reciprocal comity from the Minister and
SASSA in respect of
the remedial order and withdrawal of the supervisory order, towards
the judicial branch of government.
It must be considered
whether their conduct went even beyond that.
[14] There must be
public accounting for how this was allowed to happen.
Accountability is a central value of the Constitution.
[19]
It accompanies the conclusion of procurement contracts for the
procurement of public functions.
[20]
This judgment is the judicial part of that accounting.  It is
founded on the commitment to openness and responsiveness
the
Constitution requires.
[21]
It is important to note that this particular role, at this particular
time, is not one of the Court’s choosing.
The sole reason
for the litigation leading to this judgment is the failure of SASSA
and the Minister to keep their promise to this
Court and the people
of South Africa.
[15] What needs to
be understood, however, is that it is not this Court’s standing
or authority, for their own sakes, that
are important.  Judges
hold office to serve the people, just as members of the executive and
legislature do.  The underlying
danger to us all is that when
the institutions of government established under the Constitution are
undermined, the fabric of our
society comes under threat.  A
graphic illustration would be if social grants are not paid beyond 31
March 2017.  It
is to the practical avoidance of that potential
catastrophe that we must now turn.
Facts
[16] As stated in
[3] above this Court held, on 29 September 2013, that the award of
the tender to provide services for payment
of social grants to CPS
was constitutionally invalid.
[22]
In the remedial order, the Court suspended the order of
invalidity.
[23]
The order was based on the premise that either a new five-year tender
would be awarded after a proper procurement process,
or SASSA would
itself take over the payment of social grants when the suspended
contract with CPS came to an end on 31 March 2017.
[17] The remedial
order reads:
“1. The Contract for the Payment of Social Grants between the
South African Social Security Agency (SASSA) and Cash Paymaster

Services (Pty) Ltd (Cash Paymaster) dated 3 February 2012 is declared
invalid.
2. This declaration is suspended pending the decision of SASSA to
award a new tender after completion of the tender process ordered
in
paragraph 3 below.
3. SASSA must initiate a new tender process for the payment of social
grants within 30 days of this order:
3.1
The request for proposals for the new tender must, in addition to any
other requirements that SASSA is entitled to prescribe,
contain
adequate safeguards to ensure that—
(a) if any reregistration process is required, no loss of lawful
existing social grants occurs;
(b) the payment of lawful existing grants is not interrupted;
and
(c) personal data obtained in the payment process remains private and
may not be used in any manner for any purpose other than
payment of
the grants or any other purpose sanctioned by the Minister in terms
of
sections 20(3)
and (4) of the
Social Assistance Act 13 of 2004
.
3.2
The new tender must be for a period of five years.
3.3
A new and independent Bid Evaluation Committee and Bid Adjudication
Committee must be appointed to evaluate and adjudicate the
new tender
process.  Their evaluation and adjudication must be made public
by filing with the Registrar of this Court a status
report on the
first Monday of every quarter of the year until completion of the
process.
4. If the tender is not awarded, the declaration of invalidity of the
contract in paragraph 1 above will be further suspended
until
completion of the five-year period for which the contract was
initially awarded:
4.1
Within 14 days of the decision not to award the tender SASSA must
lodge a report with the Registrar of this Court setting out
all the
relevant information on whether and when it will be ready to assume
the duty to pay grants itself.
4.2
Within 60 days of the completion of the five-year period for which
the contract was initially awarded, Cash Paymaster must file
with
this court an audited statement of the expenses incurred, the income
received and the net profit earned under the completed
contract.
4.3
SASSA must within 60 days thereafter obtain an independent audited
verification of the details provided by Cash Paymaster under

paragraph 4.2 and file the audited verification with this Court.
5. The applicants must pay SASSA and Cash Paymaster’s costs in
relation to the application, brought in the main application
on the
merits, to lead further evidence.”
[18] SASSA followed
a new competitive tender process under the terms of the remedial
order, but on 15 October 2015 it decided not
to award the tender, and
informed the Court of its decision not to award a new contract in
early November 2015.  In terms
of paragraph 4.1 of the
order SASSA then had to file a report “setting out all the
relevant information on whether and when
it will be ready to assume
the duty to pay the grants itself”.  This it did on 5
November 2015.  On 25 November
2015 the Court issued an
order discharging its supervisory jurisdiction:
“
The Constitutional Court
has considered the Progress Report filed in terms of paragraph 4.1 of
this Court’s order dated 17
April 2014.  It has concluded
that the Progress Report is compliant with this Court’s order
and that the supervisory
jurisdiction should be discharged.”
[19] By now this is
common cause, after this Court accepted SASSA’s assurance that
it would be in a position to pay the social
grants itself after 31
March 2017, things started going awry.  What had happened is
best summarised by the Minister’s
and SASSA’s response to
the Chief Justice’s directions:
“1. In view of the fact that this Court’s order of 25
November 2015, discharging its supervisory jurisdiction, was
based on
SASSA’s decision not to award a new contract and on SASSA’s
progress report of 5 November 2015 setting
out the
information relating to its own ability to assume paying the grants
at the end of March 2017, the following information
is required:
(a)
Who was the person responsible for determining on behalf of SASSA
whether SASSA itself would not be able to pay the grants by
end of
March 2017?
The
person responsible was the CEO, on the advice of Ms Mvulane, as
explained further below. Ms Mvulane was responsible for
the
management of the project aimed at giving effect to the steps set out
in the 5 November 2015 Progress Report by means of which
SASSA
proposed to assume the duty to take over the payment function itself
after 31 March 2017. The advice of Ms Mvulane was adopted
by all
incumbents of the CEO’s office, including:
Ms
V Petersen, CEO of SASSA from May 2011 to May 2016;
Ms
R Ramokgopa, acting CEO 23 May 2016 to 31 October 2016;
Mr
T Magwaza, CEO of SASSA from 1 November 2016 to date;
In
terms of section 6(1) of the SASSA Act, the CEO is responsible for
the management of SASSA subject to the direction of the Minister.
What
has complicated things in this instance is, firstly, that the
incumbent of the office has changed several times since 5 November

2015 and, secondly, Ms Mvulane was responsible for the management of
the project aimed at giving effect to the steps set out in
the 5
November 2015 Progress Report by means of which SASSA proposed to
assume the duty to take over the payment function itself
after 31
March 2017.
As
regards the changes in the incumbency of the CEO’s office, Ms
Petersen was CEO at the time SASSA filed the Progress Report
and
remained as CEO until her term of office expired on 14 May 2016.
During the period 23 May 2016 to 31 October 2016, Ms Ramokgopa
held
office as SASSA’s acting CEO. With effect from 1 November 2016,
the Minister appointed a new CEO, Mr Magwaza. As
stated, between
27 February and 12 March 2017 Mr Magwaza was on sick
leave. Although Ms Mzobe was appointed
as acting CEO, she also
was forced to withdraw because of illness, which led to my
appointment as acting CEO for the periods to
12 March 2017.
[Mr] Todd
and Mr Haffegee have not yet managed to get hold of Ms Petersen.
They have not tried to get hold of Ms Mzobe
because she is ill and in
any event her involvement with SASSA post-dated the period relevant
to this question by several months.
They have however spoken with
Ms Mvulane, Ms Ramokgopa and Mr Magwaza.
The
information gathered by Mr Todd and Mr Haffegee suggests that the
determination on behalf of SASSA whether SASSA itself would
not be
able to pay the grants by end of March 2017 was first made by
Ms Mvulane. I understand Ms Mvulane agrees that is correct.
(b)
The date when the responsible person on behalf of SASSA first became
aware that it would not be able to pay the grants itself
by end March
2017;
19
April 2016, as explained below.
As
appears from paragraph 19 above, Ms Mvulane was aware by 19 April
2016 at the latest that SASSA would not be able to pay the
grants by
itself by the end of March 2017. It was for this reason that an
opinion was sought from counsel on certain of the legal
implications
of SASSA’s inability to pay the grants by itself by the end of
March 2017.
As
to the CEO’s knowledge of SASSA’s inability to pay the
grants by itself by the end of March 2017, as appears from
paragraph
20 above, on 20 April 2016 SASSA’s legal general manager’s
letter to the State Attorney requesting the opinion
was emailed to
the then CEO Ms Petersen; and, as appears from paragraph 24 above, on
10 June 2016 the legal opinion of Advocates
Cassim SC and Mostert,
which recorded Ms Mvulane's instructions to Adv. Mostert
(described in paragraph 21 above) that deliverables
4 and 5 and 7
listed in the Progress Report could not be achieved by 31 March 2017,
was forwarded to the then acting CEO Ms Ramokgopa.
(c)
The exact dates when the responsible person on behalf of SASSA became
aware that the [requirements in the] respective time frames
set out
in paragraph 13 of its progress report to the Court could not be
fulfilled;
The
exact dates when the responsible person came to know the relevant
time frame in relation to each deliverable listed in the Progress

Report are not known at this stage.
The
information gathered by Mr Todd and Mr Haffegee suggests that, in
relation to Deliverables 54 and 5 and 7, this occurred in
mid-April
2016.
At
this stage it is not clear whether this determination was made in
relation to all of the other deliverables listed in the Progress

Reports and if so, when.  In the limited time available, it has
not been possible for sufficiently detailed consultations
to be
conducted with Ms Mvulane and the others involved in the project
aimed at giving effect to the steps set out in the Progress
Report.
(d)
The reason why this Court was not immediately informed of this fact
and who made the decision that it was not necessary to do
so;
No
one made a decision not to inform this Court that the respective time
frames set out in paragraph 13 of the progress report could
not be
fulfilled.
As
appears from certain annexures to this affidavit the timing of the
report to the Court was the subject of various discussions
and was
also the subject of legal advice from May 2016 onwards. Furthermore
SASSA first had to concretize its plan for the period
after 31 March
2017. See paragraph 14.1 of the 31 May 2016 opinion of Adv. Cassim SC
and Mostert (Annexure WM9) and the 12 December
2016 memorandum of
Adv. Cowen and Drake (Annexure WM14).
I
accept that the Court ought to have been informed at a much earlier
stage of the fact that the time frames set out in paragraph
13 of its
progress report to the Court could not be fulfilled.
(e)
Whether the Minister was informed that SASSA would not be able to pay
the grants itself by end of March 2017 and, if so, when
this
happened.
Yes,
in October 2016.
2. In relation to the legal opinion attached to the follow-up report
and SASSA’s assertion that it has taken steps to act
on the
advice contained in it, as well as SASSA’s intended course of
action, the following information is required:
(a)
Has SASSA entered into any agreement with Cash Paymaster Services
(Pty) Limited (CPS) in relation to the payment of grants from
1 April
2017?
No,
SASSA did not enter into any agreement with CPS in relation to the
payment of grants from 1 April 2017.
(b)
If so, full details of the agreement are required. If in writing, a
copy is required;
The
agreement has yet to be negotiated and concluded.
(c)
Is it SASSA’s contention that this agreement is lawful and in
compliance with the procurement requirements of the Constitution
and
applicable legislation? Full details are required of the steps taken
in compliance with applicable procurement legislation.
If
the National Treasury approves the deviation for any resulting any
interim contract, the contract will comply with the applicable

legislation.
See
paragraphs 48 to 69 above.
(d)
Full details are required of the steps taken, or envisaged, to run a
competitive bidding process again to have a new contractor
or
contractors appointed for the payment of grants, and the exact
timeframe within which this will occur.
Government
is reviewing the approach to its payment model, and this Court will
be apprised once a determination is made. As stated
in paragraphs 36
and 37 above, a Request For Information (RFI) process was concluded a
month ago and an analysis of the responses
is being compiled which
will inform the way-forward. SASSA will provide the Court with a
concrete “road map” within
the next three months.
(e)
Full details are required of the steps to be taken to ensure that
SASSA itself will become capable of administering and paying
the
grants in future, and the exact timeframe within which this will
occur.
SASSA
will continue with the process of expert evaluation and advice and
stakeholder consultation which commenced in July 2016.
This
with a view to preparing and presenting to the Minister and, if
approved by the Minister, to the Court, a detailed plan for
the
payment of the grants.  This will be after the end of the
contract period for the contractor or contractors who will be

appointed following the competitive bidding process referred to
above.  At this stage government is reviewing the approach
to
its payment model, and this Court will be apprised once a
determination is made.
3. In view of the Minister’s and SASSA’s acceptance of
responsibility for delays in identifying and redressing deficiencies

in the plan since the last report to the Court on 5 November 2015 to
date, the following information is required:
(a)
Do SASSA and/or the Minister have any objection to independent
monitoring of any agreement SASSA may have entered into with
CPS for
the payment of grants from 1 April 2017?
No,
see paragraphs 4, 5, 6, 8, 12.1 and 12.4 of the proposed draft order
as regards the disclosure and monitoring of the agreement,
if
concluded.
(b)
If so, the content and nature of the objections must be set out;
Not
applicable.
(c)
Do SASSA and/or the Minister have any objection to independent
monitoring of the steps taken or envisaged to run, again, a
competitive bidding process to have a new contractor or contractors
appointed for the payment of grants?
No,
SASSA and/or the Minister do not have an objection to independent
monitoring, see paragraphs 9 to 11, 12.2 and 12.4 of the proposed

draft order.
(d)
If so, the content and nature of the objections must be set out;
Not
applicable.
(e)
Do SASSA and/or the Minister have any objection to independent
monitoring of the steps to be taken to ensure that SASSA itself
will
become capable of administering and paying the grants in future?
No,
SASSA and/or the Minister do not have any objection to independent
monitoring of the steps to be taken to ensure that SASSA
itself will
become capable of administering and paying the grants in future, see
paragraphs 9 to 11, 12.3 and 12.4 of the proposed
draft order.
(f)
If so, the content and nature of the objections must be set out;
Not
applicable.
(g)
If SASSA and/or the Minister do not have objections to independent
monitoring in relation to any or all of these processes,
they are
invited to propose practical measures as to how and by whom the
independent monitoring may be done.
See
paragraph 12 of the proposed draft order.
”
[20] CPS also
alerted SASSA in May 2016, that in order to prevent disruption in the
payment process, it might be better for SASSA
to extend the current
CPS contract.  Three legal opinions from different senior
counsel were obtained by SASSA in 2016.  All,
in varying terms,
warned SASSA that it was in trouble because it would not be able to
pay the grants itself and that it should
approach the Court to inform
it of the situation.  The first opinion was received by SASSA in
June 2016, the second in October
2016 and another in November 2016.
The Minister was informed that SASSA was unable to pay the
grants only in October 2016.
[21] In summary,
then.  Since April 2016 the responsible functionaries of SASSA
have been aware that it could not comply with
the undertaking to the
Court that it would be able to pay social grants from 1 April 2017.
The Minister was apparently informed
of this only in October
2016.  There is no indication on the papers that she showed any
interest in SASSA’s progress
in that regard before that.
Despite warnings from counsel and CPS, neither SASSA nor the
Minister took any steps to inform
the Court of the problems they were
experiencing.  Nor did they see fit to approach the Court for
authorisation to regularise
or ameliorate the situation.  When,
eventually, SASSA brought an application on 28 February 2017 for
authorisation, the Minister
intervened and ordered SASSA to withdraw
the application.  On 3 March 2017 the Minister and SASSA filed a
supplementary progress
report, without any acknowledgement that they
were under any legal obligation to do so.
[22] This is how
things stand at present.  There is no certainty whether and how
social grants will be paid after 31 March
2017.  No agreement
has, as yet, been concluded between SASSA and CPS to ensure payment
of social grants after that date.
On the papers it appears
that, if an agreement with CPS cannot be reached, SASSA has no other
contingency plan to ensure
payment.
These proceedings
[23] The applicant
(Black Sash Trust) applies for direct access on an urgent basis
(direct access application) for an order:
(a) That SASSA must file a report on affidavit on how it intends to
deal with an interim contract with CPS for payment of social
grants
from 1 April 2017;
(b) Declaring that CPS is under a duty to act reasonably in
negotiating that contract with SASSA;
(c) That the contract must contain adequate safeguards for various
aspects of the personal privacy, dignity and autonomy of grant

beneficiaries;
(d) That the Minister and SASSA must file continuous reports with the
Court on the steps taken and to be taken to ensure that payment
of
social grants is made from 1 April 2017; and
(e) Declaring that SASSA is under a duty to ensure that the payment
method must contain adequate safeguards for various aspects
of the
personal privacy, dignity and autonomy of grant beneficiaries.
[24] The Minister
and SASSA did not file opposition to the direct access application,
nor did any of the other cited parties,
[24]
except for CPS and the Information Regulator.
[25] CPS filed an
opposing affidavit setting out information relating to its
interaction with SASSA.  It does not oppose the
relief sought by
the Black Sash Trust, except for the initial prayer for an order
declaring that the personal information of grant
beneficiaries is the
property of SASSA.  The Black Sash Trust now accepts that this
order is misconceived and has abandoned
it.
[26] Freedom Under
Law NPC seeks leave to intervene as an applicant (intervention
application) and asks for additional orders:
(a) That details of the negotiations and conclusion of the interim
contract between SASSA and CPS be disclosed to the Court;
(b) Declaring that irrespective of the terms of the contract CPS may
not charge more than the current beneficiary fee; may not
refuse to
enter the interim contract because of this restriction; and that the
contract may not endure for longer than 18 months;
(c) That CPS must file with the Court an audited statement of
expenses, income and net profit earned under the interim contract

upon its completion; and
(d) That SASSA must obtain an independent audited verification of CPS
figures, to be approved by National Treasury and filed with
the
Court.
[27] The Minister
and SASSA do not oppose the intervention of Freedom Under Law as an
applicant, but oppose the extent of the disclosure
of documentary
information it requires, as well as the determination by this Court,
in advance, of the terms as to price and duration
on which SASSA and
CPS may contract with each other.
[28] Similarly, CPS
does not object to Freedom Under Law’s intervention, but also
objects to the extent of the disclosure
sought and the imposition of
contractual terms by the Court.
[29] Corruption
Watch NPC (RF) also seeks admission as
amicus curiae
(friend
of the Court).  It supports the relief sought by the Black Sash
Trust in the direct access application and added some
suggestions in
relation to the remedy, especially that of the Court’s
supervisory role.
[30] There has been
no opposition to Corruption Watch’s application.
[31] The South
African Post Office SOC Limited (SAPO), a state-owned corporation
established by statute,
[25]
too, seeks admission as an
amicus
.  In the main, its
depositions sought to establish that it has the capacity,
immediately, or in the medium term, to take over
the distribution of
the grants.
[32] On 8 March
2017, after receiving the “follow up report”, the Court
issued to the Minister and SASSA the directions
referred to in [12]
above.  The reply was filed a day late, on 14 March 2017.
Issues
[33] The preliminary
issues that need to be determined are:
(a) Should the application for direct access succeed?
(b) Should Freedom Under Law’s application to intervene
succeed?
(c) Should Corruption Watch’s application to act as
amicus
succeed?
(d) Should SAPO’s application to act as
amicus
succeed?
[34] On the merits,
the issues that need to be determined are:
(a) Are SASSA and CPS under any constitutional duty after 31 March
2017 to continue payment of the social grants?
(b) If they are, does this Court have the competence to make an order
compelling them to do so?
(c) Does this Court have the competence to resume supervision in
respect of:
(i)
SASSA’s conduct since the discharge of the Court’s
earlier supervisory order;
(ii)
the continued performance of SASSA’s and CPS’s
constitutional obligations in the payment of social grants;
(iii)
SASSA’s responsibilities in relation to either another
competitive bidding process or taking over responsibility for
payment
of grants itself?
(d) Are there grounds for calling for explanations from the Minister
in relation to costs being paid personally?
Direct access
[35] Whether direct
access should be granted in the interests of justice depends on—
“the importance of the constitutional issue raised and the
desirability of obtaining an urgent ruling of this Court on that

issue, whether any dispute of fact may arise . . . the possibility of
obtaining relief in another court, and time and costs that
may be
saved by coming directly to this Court.”
[26]
[36] Direct access
should be granted.  The Black Sash Trust clearly has standing to
bring the application in the public interest.
[27]
Although this Court is not well-suited to hear urgent matters
[28]
and it is a rule in the High Court that self-created urgency should
not usually be countenanced,
[29]
it is difficult to conceive of a matter more urgent on a national
scale.  The constitutional right to social assistance that
for
many, especially children, the elderly and the indigent, provide the
bare bones of a life of dignity, equality and freedom
is directly
involved, across the land.  The conduct of the Minister and
SASSA has created a situation that no one could have
contemplated:
the very negation of the purpose of this Court’s earlier
remedial and supervisory order.  The matter can
be decided on
facts that are not disputed.  Due to the time constraints of the
emergency created by the Minister and SASSA
the forum for effective
final relief is this Court.
Freedom Under
Law’s intervention application
[37] For much the
same reasons, Freedom Under Law’s application to intervene as
an applicant should also be allowed.  It
has the same kind of
standing to act in the public interest and adds important aspects
that need to be considered in relation to
the interim contract.
Corruption
Watch’s application to appear as a friend of the Court
[38] Corruption
Watch was a friend of the Court in the original
AllPay
litigation.  In light of the fact that the Minister and SASSA
are of the view that their conduct in deviating from the remedial

order does not legally oblige them to account to the Court, the
perspective offered by Corruption Watch will be of assistance to
the
Court in determining the correct position.  Corruption Watch is
admitted as a friend of the Court.
SAPO’s
application to appear as a friend of the Court
[39] To what extent
SAPO is in fact able to come to the rescue is a consideration that
belongs to an assessment of the merits of
this case.  But even
if this assertion does not find favour in the end it does not detract
from the fact that SAPO’s
perspective was important.  Not
only did it add a fresh, empowering perspective.  It gave a real
sense that, with sufficient
will and energy, the State itself could
creditably and competently manage the grants distribution process.
It is worth admitting
it as a friend of the Court.
Constitutional
obligations
[40]
In
AllPay 2
the Court held that the suspension of the
validity of the contract between SASSA and CPS did not prevent the
Court from regulating
and supervising both the content and
performance of the contract.  It did so on the basis that both
SASSA and CPS were organs
of state in relation to the contract and
that this entailed constitutional obligations for both entities;
[30]
that this Court’s remedial power under section 172(1)(b)(ii) of
the Constitution allowed it;
[31]
and that CPS also bore obligations under section 8(2) of the
Constitution because it had performed a constitutional function for
a
significant period already, the constitutional obligation persisted
to ensure that a workable payment system remains in place
until a new
one is operational.
[32]
The conclusion that the contract was invalid meant that CPS could not
benefit from it, but, conversely, should not suffer
prejudice from
being compelled to continue its performance in the face of its
invalidity.
[33]
[41] The
constitutional obligations of both SASSA and CPS as organs of state
performing a constitutional function for a considerable
period do not
end on 31 March 2017.  Both accept that.  The
difficulty that arises is how this Court may enforce
the performance
of those continuing constitutional obligations after 31 March 2017.
Enforcement and
remedy
[42] SASSA failed to
honour its assurance to this Court that it will be in a position to
make payment of social grants after 31
March 2017.  It and CPS
failed to timeously conclude a lawful contract to provide for that
payment.  These circumstances
provide a different context for
the enforcement of a just and equitable remedy from that obtained
when we made the remedial order
in
AllPay 2.
The context
then was a breach of the constitutional and legislative framework for
fair, equitable, transparent, competitive
and cost-effective
procurement.  The constitutional defect here lies elsewhere.
[43] The primary
concern here is the very real threatened breach of the right of
millions of people to social assistance in terms
of section 27(1)(c)
of the Constitution.  It is that threatened breach that triggers
the just and equitable remedial powers
the Court has under section
172(1)(b)(ii) of the Constitution, not only the potential invalidity
of the proposed new contract that
SASSA and CPS seeks to conclude.
The need to intervene under these and similar circumstances was
aptly captured by Mogoeng CJ
in
Mhlope
in these terms:
“
It bears emphasis that
this is an exceptional case that cries out for an exceptional
solution or remedy to avoid a constitutional
crisis which could have
grave consequences.  It is about the upper guardian of our
Constitution responding to its core mandate
by preserving the
integrity of our constitutional democracy.  And that explains
the unique or extraordinary remedy we have
crafted . . . .”
[34]
[44] This Court’s
extensive powers to grant a just and equitable order also permit it
to extend the contract that would otherwise
expire on 31 March 2017.
Since the contract was declared invalid in
AllPay 1
, if we
extend the contract, it will be necessary to also extend the
declaration of invalidity and the suspension of that declaration
for
the period of extension of the contract.  In
Allpay 2
we
tied up the suspension of the declaration of invalidity to the period
of the invalid contract.  That was done, in order
“to
allow the competent authority to correct the defect”
[35]
and to avoid disrupting the provision of crucial services that it was
constitutionally obliged to render.
[45] As the judgment
of my brother Madlanga J shows, there is another valid way of
arriving at an identical outcome, but I
do not think there is any
harm in declaring, to the extent necessary, the continued suspension
of the invalid contract.
[46] CPS is correct
in submitting that its continued constitutional obligation to provide
services for payment after 31 March 2017
exists only if there is
no-one else to provide those services.  It is also correct that
it will not be in a position to perform
its continuing constitutional
obligation for payment of social grants if the reciprocal obligations
of SASSA and CPS in relation
to that payment are not specified.
But it is not correct that those obligations can only be specified by
way of a negotiated
contract between itself and SASSA.
[47] Is there anyone
else who can provide the grant payment services?  SAPO made bold
to say that it would be in a position
to do so soon.  But it
sought admission as friend of the Court, not as a party seeking
substantive relief.  Its factual
assertions of its capability
introduced new evidence that does not fall within the ambit of the
application.  The Court is
not in a position at this stage to
assess its worth and it is in any event not within its remit to do
so.  So it must be accepted
that CPS is, at present, the only
entity capable of making payment of the social grants after 31 March
2017.
[48] All that
remains then is the just and equitable remedy to ensure that the
reciprocal obligations between SASSA and CPS for
payment of the
social grants are properly identified and circumscribed.  CPS
says that can be done only by way of a consensual
contract concluded
between it and SASSA.  But once it is accepted that the
constitutional obligations of SASSA and CPS are
not sourced in any
contract still in practical existence, but in their mutual
constitutional obligation to ensure that the right
to social
assistance of the many people that have been dependent on past
payment through CPS are not rendered nugatory, the logic
of private
consensual agreement as the only way to determine the content of
their respective reciprocal obligations in respect
of payment falls
away.  It is then for the Court in the exercise of crafting a
just and equitable remedy to spell out the
content of those
obligations.
[49] Can this be
done outside the fair and equitable procurement framework put in
place under the authority of section 217 of the
Constitution?
All parties agreed that it could, for the very reason that the
constitutional and legal source is that of section 172(1)(b)(ii)

of the Constitution and not section 217.
[50] There was much
debate during the oral hearing on whether it would be just and
equitable to order that those reciprocal obligations
should be same
as that of the contract that expires on 31 March 2017.  I
consider that it should be.  No party has any
claim to profit
from the threatened invasion of people’s rights.  At the
same time no one should usually be expected
to be out of pocket for
ensuring the continued exercise of those rights.  That
equilibrium was the premise of the Court’s
previous remedial
order.  It is just and equitable to continue on that basis.  Our
order below reflects that SASSA and
CPS should continue to fulfil
their respective constitutional obligations in the payment of social
grants for a period of 12 months
as an extension of the current
contract.  To the extent necessary, our earlier declaration of
invalidity of that contract
will be further extended, as well as the
suspension of that declaration of invalidity.  In the event that
CPS wishes to alter
the content of its financial obligations or
entitlement, the order makes provision for it to approach National
Treasury for its
consideration and approval, to be confirmed after a
report on the issue to this Court.
[51] It is necessary
to be frank about this exercise of our just and equitable remedial
power.  That power is not limitless
and the order we make today
pushes at its limits.  It is a remedy that must be used with
caution and only in exceptional circumstances.
But these are
exceptional circumstances.  Everyone stressed that what has
happened has precipitated a national crisis.
The order we make
imposes constitutional obligations on the parties that they did not
in advance agree to.  But we are
not ordering something that
they could not themselves have agreed to under our supervision had an
application been brought earlier,
either by seeking an extension to
the contract that would have expired on 31 March 2017 or by entering
into a new one.
Content and
performance of the proposed contract
[52] The Black Sash
Trust, Freedom Under Law, Corruption Watch and SAPO all, in varying
degrees, suggest that this Court should
regulate or prescribe the
obligations that SASSA and CPS should adhere to in the conclusion of
the proposed contract to provide
services for the payment of social
grants.
[53] As stated above
the constitutional obligations of both SASSA and CPS as organs of
state performing a constitutional function
for a considerable period
do not end on 31 March 2017.  Both accept that.  There is
no opposition to the relief sought
by the Black Sash Trust in
relation to declaring that CPS is under a duty to act reasonably in
negotiating that contract with SASSA;
and that the contract must
contain adequate safeguards to protect various aspects of the
personal privacy, dignity and autonomy
of grant beneficiaries.
[54] To go further
than that by imposing limits in advance on specific contractual terms
that may be agreed to between SASSA and
CPS is not justified.  If
these terms turn out to be constitutionally or otherwise legally
objectionable they may be challenged
in due course.  But now is
not the opportune time to do so.  CPS has indicated that it has
no problem with disclosure
in relation to this contract similar to
what was ordered earlier.  That will also be provided for in the
order.
Court supervision
[55] That leaves the
issue of supervision of the performance of the contract.  It is
justified, but more appropriately dealt
with under SASSA’s
obligations in this regard, because that is where the problem lies.
[56] In
AllPay 2
this Court commented on SASSA’s conduct:
“
Before concluding, it is
necessary to say something about SASSA’s conduct.  SASSA
is an organ of state.  It is bound
by the basic values and
principles governing public administration set out in section 195 of
the Constitution.  As is evident
from this judgment, and the
merits judgment, SASSA’s irregular conduct has been the sole
cause for the declaration of invalidity
and for the setting aside of
the contract between it and Cash Paymaster.
This court sought further
submissions from the parties to assist in the difficult task of
determining appropriate relief.  The
importance of this is
obvious, not only because of the vast sums of money involved but more
importantly because of the enormous
consequences of irregularities
where the interests of beneficiaries, particularly children, play a
pivotal role in assessing the
appropriate remedy.
Yet, contrary to the obligations
it carries under section 195, SASSA has adopted an unhelpful and
almost obstructionist stance.
It failed to furnish crucial
information to AllPay regarding the implementation of the tender, and
to Corruption Watch in
respect of steps it took to investigate
irregularities in the bid and decision-making processes.  Its
conduct must be deprecated,
particularly in view of the important
role it plays as guardian of the right to social security and as
controller of beneficiaries’
access to social assistance.”
[36]
[57] Regrettably,
not much has changed, except that this time around the Minister may
have contributed to the continued recalcitrance.
For purposes
of this part of the judgment the problem to be addressed is the
demonstrated inability of SASSA to get its own
affairs in order, in
relation to the performance of the contract, a competitive bidding
process and becoming able to make payment
of grants under its own
steam.
[58] All this
requires explanation and accountability.  This conduct puts
grant recipients at grave risk and appears to disregard
Court
orders.  Both these aspects fall within the Court’s
jurisdiction and wide remedial powers and will be addressed
in the
order we make at the end of this judgment.
[59] SASSA and the
Minister have used the discharge by this Court of its supervisory
jurisdiction as justification that there was
no need for them to
inform or approach the Court when it became clear that SASSA would
not be in a position to assume the duty
to pay the grants itself.
This is disingenuous and incorrect.
[60] Although the
supervisory part of the order was discharged, the material content of
the order remained.  SASSA had only
two options under the order,
either to make provision for the payment of social grants through a
competitive tendering process,
or to pay the grants itself after 31
March 2017.  When it became aware that it could do neither, any
steps to go outside these
two options was in disregard of this
Court’s remedial order.
[61] Nothing
practical or legal prevented the Minister and SASSA from approaching
the Court.  They were aware that compliance
was impossible from
late August to October 2016.  They could have filed a further
report immediately on becoming aware of
this dire situation or they
could have filed an application authorising SASSA to take steps to
remedy the situation that had arisen.
The former they did on 3
March 2017, the latter on 28 February 2017 – only to attempt
withdrawal of the application a day
later.
[62] That inability
has compromised the continued protection of access to their right to
social assistance for grant recipients.
That justifies further
Court supervision.  But that has been proved not to be enough to
coax SASSA into doing what it
was constituted to do.  More is
required.
[63]
The Black Sash Trust initially sought an order requiring SASSA
to file a report on how it was proposing to deal with its proposed

“interim contract” with CPS; declaring that CPS was under
a duty to act reasonably in negotiating and concluding the
interim
contract; that the contract should:
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; provide
that personal information of beneficiaries is
the property of SASSA; provide that such personal information shall
at the end of
the contract be given to SASSA, and removed from the
possession of CPS, its parent company and all its affiliate
companies, except
where such a company and a beneficiary have a
continuing contractual relationship; and preclude a contracting party
from inviting
beneficiaries to “opt in” to the
sharing of their confidential information for the marketing of their
goods and
services.
[64]
It also sought an order that the Minister
and SASSA are to file reports on affidavit with this Court on or
before a date determined
by the Court on what steps they have taken,
what steps they will take, and when they will take each such future
step, to ensure
that the payment of all social grants is made when
they fall due after 31 March 2017 and matters ancillary to that.
The
Minister and SASSA were to file reports on affidavit with
this Court on a quarterly basis, commencing on the date of this
order,
setting out how they plan to ensure the payment of social
grants after the expiry of any “interim contract”, what
steps
they have taken in that regard, what further steps they will
take, and when they will take each such future step, so as to ensure

that the payment of all social grants is made when they fall due
after the expiry of any “interim contract”.
[65]
These reports by the Minister and SASSA
should include, but not be limited to, the applicable time-frames for
the various deliverables
that form part of the plan, whether these
time-frames have been complied with, and if not, why so and what will
be done to remedy
the situation.  If any material changes
occurred these should immediately be reported to the Court.  The
payment method
it determines should 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, and
should
preclude a contracting party from inviting beneficiaries to “opt in”
to the sharing of their confidential
information for the marketing of
their goods and services.
[66]
During oral argument the Black Sash Trust
accepted that an order of the kind contemplated in [50] above would
make much of its prayers
redundant.  It accepted that it was
competent for the Court to make an order of that nature and asked
that its requested safeguards
in relation to the personal information
of grant recipients should remain.  It supported the appointment
of independent monitors
to be involved with the supervision process.
[67]
Our proposed new just and equitable
remedial order will have a similar effect on many of the proposals
the other parties made as
well.
[68]
What remains relevant of Corruption Watch’s
suggestions are the appointment of a legal practitioner and the
nomination of
suitably qualified experts to report on legal and
technical issues arising during the period of the remedial order.  It
also
sought similar audited statements in respect of the new remedial
order to those in the old remedial order on financial information

during the relevant period.  It still seeks an order that this
matter be referred to:
“
The Public Protector to
conduct an investigation, and if necessary to order remedial action,
into the conduct of SASSA, the Department
of Social Development, the
Minister of Social Development and CPS since 17 April 2014, when the
Court handed down the order in
Allpay Consolidated Investment
Holdings (Pty) Ltd and Others v Chief Executive Officer of the South
African Social Security Agency
and Others (No 2)
2014 (4) SA 179
(CC) until the conclusion of the contract between SASSA and CPS for
the distribution of social grants from 1 April 2017; and
[t]he Directorate for Priority
Crime Investigation to investigate the conduct of SASSA, the
Department of Social Development, the
Minister of Social Development
and CPS since 17 April 2014, when the Court handed down the order in
Allpay Consolidated Investment Holdings (Pty) Ltd and Others v
Chief Executive Officer of the South African Social Security Agency

and Others (No 2)
2014 (4) SA 179
(CC), until the conclusion of
the contract between SASSA and CPS for the distribution of social
grants from 1 April 2017.”
[69] The first to
third respondents proposed a draft order to this Court.  In this
order, the Auditor-General is nominated
as a possible independent
monitor to assist the Court.  In terms of section 188(2)(b) of
the Constitution, the Auditor-General
may audit and report on the
accounts, financial statements and financial management of any
institution that is authorised in terms
of any law to receive money
for a public purpose.  CPS is such an institution in the present
circumstances.
[70] Freedom Under
Law asked for information relating to the proposed contract between
SASSA and CPS to be disclosed and that a
cap be placed on the price
that could be charged and paid.  Most of that falls away, except
the duty relating to financial
reporting.  The Minister and
SASSA did not oppose the Black Sash Trust’s original prayers
and its agreement thus falls
to be trimmed in a similar way.
[71] In its
submissions, the Black Sash Trust relies on case law to enhance the
importance of the appointment of independent monitors
by courts.
[37]
None of the parties opposed the appointment of independent
monitors.
Breach of
constitutional obligation and costs
[72] From what has
been stated, especially in [55] to [71] , there are reasonable
grounds for investigating whether this Court’s
remedial order
was disregarded and, if so, whether this was done wilfully.  The
Black Sash Trust submitted that the Minister
misled Parliament during
her appearance before the Parliamentary Committee in November 2016.
There is little doubt that the
Minister and SASSA are liable in
their official capacity for the costs, but in view of the possibility
that individual conduct
may have played a material role in the
matter, the order will also provide for further opportunity for
explanation in that regard.
[73] The Minister
bears the primary responsibility to ensure that SASSA fulfils its
functions.  She appoints its CEO.
There is little the CEO
can do without her direction.
[38]
Attempts to obtain evidence of what steps she took after
AllPay 2
to ensure that beneficiaries would continue to be well catered for
drew a blank.
[74] Given this
chain of responsibility, there may thus be no grounds, in the end,
for considering whether any individual officials
of SASSA should be
mulcted, personally, in costs.  The office-holder ultimately
responsible for the crisis and the events
that led to it is the
person who holds executive political office.  It is the Minister
who is required in terms of the Constitution
[39]
to account to Parliament.  That is the Minister, and the
Minister alone.
[75] All these
aspects require further scrutiny, but that can only be done after the
potentially affected parties are joined to
the proceedings in their
personal capacities and given an opportunity to explain their conduct
in relation to each of these issues.
Order
[76] 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 a date
three months after
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

time-frames 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.
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.
MADLANGA J
[77] I commend my
colleague, Froneman J, for this feat within so short a time.
But for one issue, I agree with his reasoning
and order.
[40]
[78] I do not see
why we would want to follow a path that orders the extension of the
contract that expires on 31 March 2017, presumably
with all its
invalidity stemming from our declaration in
Allpay 1
, only to
extend the “earlier” declaration of invalidity.
Presumably this is being done to ensure that the contract
under which
SASSA and CPS will fulfil their obligation of paying social grants
will be valid.
[79] But – in
order to get to a valid contract – it is not necessary to
follow a tortuous route.  As the main judgment
says, we have an
extremely wide remedial power afforded us by section 172(1)(b)(ii) of
the Constitution.
[41]
In addition,
Allpay 2
tells us – and so does the main
judgment – that CPS is an organ of state; as such it bears a
constitutional obligation
to see to the continued payment of social
grants.
[42]
It is within our remit – in the exercise of our wide remedial
power – to order CPS to continue fulfilling this
constitutional
obligation.  So, I prefer making that direct order.
[80] I am happy with
the resultant contract being on the same terms as those of the
expiring contract.
As for validity, the
new contract will be valid because it comes into being as a result of
our order.
[81] I would thus
accept the order contained in the main judgment shorn of that part
that provides for an extension of the old contract
and the extension
of the declaration of invalidity.
For the Applicant:
G
Budlender SC, G Snyman and Z Ngwenya instructed by the Centre
for Applied Legal Studies
For the Intervening
Party:
D Unterhalter SC, A Coutsoudis and X Hilita
instructed by Nortons Incorporated
For the First to
Third Respondents:
A M Breitenbach SC, G A Du Toit
and DM Nyathi instructed by Tim Suzaki Incorporated
For the Sixth
Respondent:
A Cockrell SC, J Bleazard and
N Luthuli instructed by Smit Sewgoolam Incorporated
For the Seventh
Respondent:
K Tsatsawane and M Kgariya instructed
by
Gildenhuys Malatji Incorporated
For the First Amicus
Curiae:
C Steinberg, L Kelly and K Van Heerden
instructed by Van Hulsteyns Attorneys
For
the Second Amicus Curiae: A Bava SC and G Badela instructed by
Shepstone and Wylie
[1]
See Delany and Jehoma “Implementation of social grants:
Improving delivery and increasing access” in Delany et al (eds)
South Africa Child Gauge
(Cape Town Children’s
Institute, University of Cape Town, 2016) at 60.
[2]
Freedom in the sense of being able to start looking after
themselves.  See Friedman “Dlamini may unwittingly have

given a boost to grants project”
Dispatch Live
(9 March
2017), available at
http://www.dispatchlive.co.za/opinion/2017/03/09/dlamini-may-unwittingly-given-boost-grants-project/
.
[3]
The Minister and SASSA both bear responsibility: See sections 92,
195(1) and 217 of the Constitution and
section 4
of the
South
African Social Security Agency Act 9 of 2004
.
[4]
Section 27(1)(c) of the Constitution provides:
“Everyone has the right to have access to—
. . .
(c)
social security,
including, if they are unable to support themselves and their
dependants, appropriate social assistance.”
[5]
Section 27(2) of the Constitution provides:
“The state must take
reasonable legislative and other measures, within its available
resources, to achieve the progressive
realisation of each of these
rights.”
[6]
13 of 2004.
[7]
Section 4 provides for the responsible Minister to make available
child support grants, care dependency grants, foster child
grants,
disability grants, older person grants, war veteran grants and
grants-in-aid.
[8]
9 of 2004.
[9]
Section 4.
[10]
Section 6(1)(a).
[11]
Section 4(2)(a).
[12]
AllPay Consolidated Investment Holdings (Pty) Ltd v Chief
Executive Officer, South African Social Security Agency
[2013]
ZACC 42
;
2014 (1) SA 604
(CC);
2014 (1) BCLR 1
(CC) (
AllPay 1
).
[13]
AllPay Consolidated Investment Holdings (Pty) Ltd v Chief
Executive Officer, South African Social Security Agency
[2014]
ZACC 12
;
2014 (4) SA 179
(CC);
2014 (6) BCLR 641
(CC) (
AllPay 2
).
[14]
Four opinions from counsel were obtained on 31 May 2016, 27 October
2016, 10 November 2016 and 12 December 2016, respectively.
[15]
AllPay 1
above n 12 at para 72.
[16]
Economic Freedom Fighters v Speaker of the National Assembly;
Democratic Alliance v Speaker of the National Assembly
[2016]
ZACC 11
;
2016 (3) SA 580
(CC);
2016 (5) BCLR 618
(CC) at para 19;
Doctors for Life International v Speaker of the National Assembly
[2006] ZACC 11
;
2006 (6) SA 416
(CC);
2006 (12) BCLR 1399
(CC)
at para 23; and
President of the Republic of South Africa v South
African Rugby Football Union
[1999] ZACC 11; 1999 (2) SA 14
(CC); 1999 (10) BCLR 1059 (CC).
[17]
Section 217 provides:
“(1) When an organ of state in the national, provincial or
local sphere of government, or any other institution identified
in
national legislation, contracts for goods or services, it must do so
in accordance with a system which is fair, equitable,
transparent,
competitive and cost-effective.
(2) Subsection (1) does not prevent the organs of state or
institutions referred to in that subsection from implementing a

procurement policy providing for—
(a) categories of preference in the allocation of contracts; and
(b) the protection or advancement of persons, or categories of
persons, disadvantaged by unfair discrimination.
(3) National legislation must prescribe a framework within which the
policy referred to in subsection (2) must be implemented.”
[18]
The application was withdrawn on the instruction of the Minister.
[19]
AAA Investments (Pty) Ltd v Micro Finance Regulatory Council
[2006] ZACC 9
;
2007 (1) SA 343
(CC);
2006 (11) BCLR 1255
(CC) at
para 89.
[20]
AllPay 2
above n 13 at para 64.
[21]
Section 1(d) of the Constitution.
[22]
AllPay 1
above n 12.
[23]
AllPay 2
above n 13.
[24]
The Minister of Finance and National Treasury.  The Information
Regulator only opposed the application in part.
[25]
South African Post Office SOC Ltd Act 22 of 2011
.
[26]
Zondi v MEC for Traditional and Local Government Affairs
[2004] ZACC 19
;
2005 (3) SA 589
(CC);
2005 (4) BCLR 347
(CC) at para
12.
[27]
Section 38(d) of the Constitution.
[28]
Ramakatsa v Magashule
[2012] ZACC 31
;
2013 (2) BCLR 202
(CC)
at para 39.
[29]
Freedom Under Law (RF) NPC v National Director of Public
Prosecutions
[2015] ZAGPPHC 759 at paras 45-6.
[30]
AllPay 2
above n 13 at paras 52-60.
[31]
Id at para 63.
[32]
Id at paras 64-6.
[33]
Id at para 67.
[34]
Electoral Commission v Mhlope
[2016] ZACC 15
;
2016 (5) SA 1
(CC);
2016 (8) BCLR 987
(CC) (
Mhlope
) at para 137.
[35]
See section 172(1)(b)(ii) of the Constitution.
[36]
AllPay 2
above n 13 at paras 73-5.
[37]
Government of the Republic of South Africa v Grootboom
[2000]
ZACC 19
;
2001 (1) SA 46
(CC);
2000 (11) BCLR 1169
(CC) at para 97;
South African Human Rights Commission v Minister of Home Affairs:
Naledi Pandor
[2014] ZAGPJHC 198; and
Madzodzo v
Minister of Basic Education
[2014] ZAECMHC 5; 2014 (3) SA 441
(ECM).
[38]
See [2] above.
[39]
Section 55 of the Constitution sets out the powers of the National
Assembly.  It provides:
“(1) In exercising its legislative power, the National
Assembly may—
(a) consider, pass, amend or reject any legislation before the
Assembly; and
(b) initiate or prepare legislation, except money Bills.
(2) The National Assembly must provide for mechanisms—
(a) to ensure that all executive organs of state in the national
sphere of government are accountable to it; and
(b) to maintain oversight of—
(i) the exercise of national executive authority, including the
implementation of legislation; and
(ii) any organ of state.”
[40]
I refer to Froneman J’s judgment as the main judgment.
[41]
Id [58].  See also
Mhlope
above n 34 at para 137.
[42]
Allpay 2
at para 52; and main judgment [41] and [53].