The department of public works & infrastructure, which is tasked with managing the state’s property portfolio, is struggling to collect more than R9bn in outstanding fees for rentals and services from government departments and agencies.
The department has revealed this in a letter to parliament’s public finance watchdog, the standing committee on public accounts (Scopa).
The matter threatens to undermine the government’s drive to enforce the user-pays principle. The government has in recent times emphasised the need for South Africans to pay for services rendered. This is at a time when municipal debt to Eskom, the country’s struggling power utility, is continuing to grow at a frightening rate as a number of municipalities fail to pay their bills.
Municipalities owe Eskom close to R36bn, an increase of nearly 26% from the financial year ended in March 2021.
Some of the major culprits in the debt owed to public works include the department of defence, which owes about R3.3bn, correctional services (nearly R3bn), and the SA Police Service (about R800m).
The National Treasury, which is charged with managing the national purse and overseeing sound financial management across the government, itself owes public works R256m, with the bulk of that (about R220m) disputed.
At the same time, residents owe municipalities more than R140bn for services.
The ANC national executive committee, the governing party’s highest decision-making body between its national conferences, has resolved to embark on a mass campaign to encourage communities to pay for services. But its efforts are likely to be stillborn as its own government officials fail to meet payment obligations.
Disputes
In the letter addressed to Scopa chair Mkhuleko Hlengwa, acting public works director-general Imtiaz Fazel pointed out that the department was owed R9.3bn by departments and entities, with almost R4bn of that under dispute. For instance, the department of correctional services had “insufficient budget”, which means it entered into an agreement exceeding the budget allocated to it.
The dispute with the National Treasury centres on a renewed lease contract amount, which is said to be almost 60% higher than the expired lease.
Stats SA — the agency responsible for producing SA’s official statistics, including GDP data and the consumer price index — owes the department R36m, with R25m under dispute because of the interest charges.
DA MP Alf Lees said it was “scandalous” that public works and infrastructure minister Patricia de Lille could not get her cabinet colleagues to pay for services rendered.
“This despite regular cabinet meetings at which surely this serious matter is addressed ... Given this outstanding debt debacle, coupled with other failures such as the Beitbridge border fence/wash line and the burning of parliament, it is clear that Patricia de Lille is not competent to perform the job of minister of public works and should be fired ... if she fails to resign,” Lees said.
De Lille has previously said she asked her department to implement a debt recovery process, adding that officials had tried to meet clients directly and had sent letters to the ministers and the directors-general.
“We are trying as hard as we can to recover this money. It is not only Eskom that is owed money, we are also owed money,” De Lille said at a recent media conference.
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