Western Cape Government pays 99% of suppliers within 30 days

11 October 2019

In both the 2017/18 and 2018/19 financial years, the Western Cape Government departments paid on average 99.4% of all invoices for goods and services within 30 days. 

Of the total outstanding value of invoices older than 30 days by provincial governments in the 2018/19 financial year, the Western Cape Government accounts for only 0.01%.

As a comparison, the Gauteng Provincial Government owed R2.5billion, while the Western Cape Provincial Government owed R240,497 in the 2018/19 financial year.

As the Western Cape Government, we recognise the pressures that businesses face in the current economic climate and the impact that late or non-payment of invoices can have on the financial health of our suppliers.

As such, important measures have been taken to ensure that suppliers are paid timeously, and every effort will be made ensure this is continued.

Critical to ensuring timeous payment is the implementation of systems that track invoices sufficiently, and reporting mechanisms to track late payments.

In 2013, a survey conducted by Provincial Treasury revealed that not all Western Cape Government departments had a suitable system in place to track invoices.

This led to Provincial Treasury issuing a circular requiring all Accounting Officers to track the receipt of invoices, progress made with the payments of these invoices and when it was settled, as well as the reasons for the delay of payments.

Provincial Treasury also implemented stringent monthly reporting processes to report on invoice payments.

In cases where invoices are settled after 30 days, departments are required to provide reasons for the late payments, together with the age analysis and the remedial or preventative measures that have been instituted to remedy such cases in future.

Where invoices have not been paid on time it could be attributed to outstanding verification processes that delay payments to contractors or instances where invoices are issued to regional office s and need to be re-routed.

Minister for Finance and Economic Opportunities, Minister David Maynier, reinforced the Western Cape Government’s commitment to paying suppliers timeously: “For businesses to thrive they need predictable cash flow to pay their employees, deliver services or products, and continue contributing to our economy and creating more jobs.

‘It would simply be wrong if government was responsible for the closure of a business due to the late payment of invoices, as this would contribute to job losses and an increased unemployment rate in the Western Cape.

“A thriving private sector is critical to the growth of the economy in the Western Cape.  As the Western Cape Government, we are “open for business” and committed to working with businesses in the province to grow the economy and create jobs in the Western Cape.”

Statement issued by Francine Higham, Spokesperson for the Provincial Minister of Finance and Economic Opportunities (Responsible for the Provincial Treasury and the Department of Economic Development and Tourism), 11 October 2019