The Constitutional Court has ordered Cash Paymaster Services (CPS) to repay R81,286,177 in adjusted profits to the South African Social Security Agency (SASSA). The ruling, handed down on 8 April 2026, addresses profits earned under a contract for the distribution of social grants that was declared invalid.
The case stems from a long-running dispute over a contract awarded to CPS in 2012 to handle the payment of social grants nationwide. The agreement, which ran until September 2018 and was extended twice, was later found to be unlawful. Freedom Under Law brought the matter to the apex court to hold CPS accountable for any profits derived from the invalid contract.
Earlier court rulings had allowed the contract to continue operating despite its invalidity. This was done specifically to prevent any disruption to social grant beneficiaries, who rely on timely payments. However, the Constitutional Court has now determined that profits made from the unlawful agreement must be repaid, even though CPS is currently in liquidation.
SASSA spokesperson Paseka Letsatsi expressed confidence that the money can be recouped. “We are convinced that the money will be recouped,” he said. “Remember they [CPS] are under the administrator or you can rather say they’re under liquidation. But this does not necessarily mean that they will not be able to pay the 81 million which they owe to SASSA.”
Letsatsi noted that being under business rescue or liquidation does not mean the company has no funds. “If you are under the business rescue it doesn’t mean you’ve got zero balance in your account,” he explained. SASSA intends to engage directly with the administrator or liquidator of CPS to enforce the court order and determine the next steps for recovery.
The spokesperson acknowledged that SASSA and CPS had initially contested aspects of the case together, but SASSA later withdrew from that position, leaving CPS to defend it alone. When asked about accountability for extending the contract, Letsatsi emphasised that SASSA was obliged to implement a prior court judgment.
“The decision of the court was very clear that as much as the contract may have been illegal or may have had some problems with it, however, the instruction which we had to implement as an organisation was to make sure that the contract is implemented so that there is no disruption in terms of the payment of social grants beneficiaries,” he said.
He added that failing to comply with a court order could have resulted in contempt of court charges for SASSA officials. “We were left with no option but we are obliged as an organisation to make sure that we implement the court order.”
On lessons learned, Letsatsi stated that the matter is now “water under the bridge,” but highlighted the importance of robust processes in future procurement. “Generally what we have learned is that we need to make sure that we take stock of everything that we do. We basically do the checks and balances to make sure that at the end when we award the contract people do not necessarily contest the outcome.”
The ruling underscores principles of accountability in public procurement and the handling of public funds, particularly in the sensitive area of social grants. SASSA has welcomed the judgment as a step toward ensuring constitutional compliance in the administration of social support for vulnerable South Africans.
Recovery of the funds will depend on engagements with CPS’s liquidator, as the company remains insolvent. The court has granted SASSA leave to prove a concurrent claim in the liquidation process.
