Tuesday, 07 December 2021

Pretoria: Public Service Commission Commissioner Michael Seloane says non-payment of suppliers by government departments impacts negatively on businesses.

Seloane said evidence has shown that the departments are not adhering to the principles of efficient and effective use of public resources and accountability.

Addressing a media briefing in Pretoria earlier today, Seloane said unpaid invoices have the potential of destabilising any business, especially the SMMEs whose lifeblood is the sufficient availability of cash flow, which ultimately impact negatively on government’s initiative of achieving its job creation and economic growth outcomes.

“In discharging its constitutional mandate, the PSC has been monitoring the payments of suppliers within the prescribed period since the 2017/18 financial year,” he said.

Seloane said non-compliance has impacted negatively on small businesses with some of the suppliers forced to close their doors.

“The PSC welcomes the consideration by the Minister of Finance in terms of the small business support measures to enable these businesses to bounce back from the negative impact of COVID-19 and the economic hardship,” Seloane said.

He said there has been some improvements in some departments even though some departments and provinces continue to fail to adhere to the PFMA requirements.

Seloane acknowledged that there has been some improvements in the payment of suppliers by the national departments as compared to the first quarter.

“The challenge remains on the late and non-submission of reports by departments to the National Treasury, such as the Department of Traditional Affairs and the department of Correctional Services and Justice and Constitutional Development failed to submit their reports for September 2021,” he said.

Seloane said provinces such as the Eastern Cape, Gauteng and North West are still facing major challenges in terms of the 30-day payments and have the highest amounts owed to suppliers.

As at end of September 2021, the Eastern Cape recorded 4 648 invoices with a related cost of R2 280 024 142 as compared to 8 057 invoices with a related cost of R2 228 122 449 as at the end of September 2021.

For Gauteng, 4 855 invoices with a related cost of R1 044 398 803 was recorded at the end of September 2021 as compared to 1 677 invoices with a related cost of R790 771 938 as at end of June 2021.

The North West province recorded 4 340 invoices with a related cost of R266 912 565 at the end of September 2021 as compared to 5 527 invoices with a related cost of R456 021 865 at end of June 2021.