Nine years to pay supplier: Gauteng payment delays worsen
According to the Gauteng Provincial Government delays in payment of suppliers have worsened in the past months. This according to a written reply to my question by Finance MEC Mandla Nkomfe.
Despite promises by the provincial government that things would improve and a much-applauded campaign by Premier Nomvula Mokonyane called ‘Operation Bhadala', things are worse not better.
Previous responses had indicated that suppliers waited two months on average for the payment of an invoice, where the worst cases would date back two years or more and sometimes even four years elapsed before payment.
There was a golden moment in October last year when government succeeded in paying invoices within an average of 40.41 days. Even then, one supplier had had to wait 99 months, or eight years.
Payment should be made within 30 days. Anything more than 30 days is breaking the law. Moreover, payment delays lead to cash flow problems, which lead to business closures and the loss of jobs. This government is the cause.
The last-known performance indicator on payment delays showed that the provincial government took 94.74 days on average from receipt of invoice to time of payment. In the worst case that month a supplier was paid 92 months after submitting an invoice.
The worst delay was uncovered in January this year when a supplier was paid 3 355 days, or 110 months, after submitting the invoice. That's a 9-year delay.
Statistics given by the government showed the following:
|
Month |
Average delay from invoice to payment |
Worst delay |
|
April |
57.76 days |
1 453 days |
|
May |
51.58 days |
1 523 days |
|
June |
58 days |
2 616 days |
|
July |
50.09 days |
1 560 days |
|
August |
57.28 days |
2 624 days |
|
September |
51.16 days |
2 976 days |
|
October |
40.41 days |
3 021 days |
|
November |
42.79 days |
1 392 days |
|
December |
67.51 days |
2 626 days |
|
January |
48.95 days |
3 355 days |
|
February |
84.87 days |
2 674 days |
|
March |
94.74 days |
2 802 days |
A DA-led government in Gauteng would ensure that suppliers are paid on time. Staff responsible for payment delays would be disciplined and where appropriate, dismissed.
The DA's track-record in the Western Cape testifies to this, where the provincial treasury has implemented strict management of invoices from the time of receipt to disbursement by date stamping all receipts.
The strategy of the Western Cape aims at dealing with all red tape, including the late payment of suppliers to create an enabling environment in which local businesses can grow and employ more people.
This would ensure certainty for suppliers dealing with government. This would encourage business activity and create more jobs. It's time for change.
Statement issued by Mike Moriarty MPL, DA Gauteng Finance Spokesperson, September 17 2012
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