The Eastern Cape health department had stacked up almost R2bn in unpaid bills at the end of the financial year — and they will probably consume 10% of the new year’s budget allocation.
In a reply to a parliamentary question by DA MP Leon Schreiber, finance minister Tito Mboweni identified the Eastern Cape health department as the worst offender when it came to paying bills late. The government has committed to pay suppliers within 30 days.
However, information provided by the Treasury showed that the province's health and education departments had nearly R3bn in unpaid invoices more than 30 days old on March 31. Nearly two-thirds of this is the Eastern Cape health department, which owes R1.9bn in overdue payments. Together with invoices that were not overdue, it is likely that the department used a substantial part of its R26.4bn 2021/2022 budget to make last year’s payments.
The Gauteng health department was the next worst offender with R342m in overdue bills followed by the North West with R327.5m.
National departments collectively had R416.8m in overdue payments at December 31, with the vast bulk of it sitting in the department of water & sanitation and its trading entity, which manages water infrastructure and resources.
In a reply to another question by DA MP Hendrik Krüger, the National Treasury said that since 2009, when the cabinet first resolved that departments must pay invoices within 30 days, it had taken various steps to encourage compliance. It monitored payment of invoices on a quarterly basis and required reports from accounting officers on reasons for unpaid invoices. The Treasury said it was now finalising “a guideline on payments within 30 days to assist accounting officers with measures to implement to improve the level of compliance”.
“While it is not currently a legal requirement that public entities must settle their invoices within 30 days, it is considered a best practice. When amendments are effected to the Treasury regulations, public entities will also be legally required to pay their invoices within 30 days from date of receipt of an invoice,” said the reply.
No details were provided on when such an amendment would be made.
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