Gauteng small businesses that provide services to the Department of Health in the province have to wait extremely long before they are paid. This means that they may potentially struggle to pay their employees on time because of this delay.
This information was revealed to me by the MEC for Health, Nomathemba Mokgethi, in reply to my questions tabled in the Gauteng Provincial Legislature (GPL) regarding the payment of invoices.
Out of 122 018 invoices received for the 2021/2022 financial year, only 22 794 were paid within 15 days, and 99 227 were paid out of 15 days. 62 235 invoices were paid out of 30 days.
This has resulted in R1 510 582,28 being paid in penalties due to the late payment of invoices to FNB (Medico-Legal Litigations), Telkom, Eskom, and EMS (Standard Bank).
The late payments of invoices put the delivery of services at risk, as suppliers may withhold their services until they are paid in full.
Given the current load shedding crisis where many small businesses may be unable to trade for between 4 to 6 hours daily, the late payment of invoices by the Gauteng Department of Health is an added burden in their attempts to keep their businesses afloat.
The DA will be putting pressure on all government departments to pay suppliers within 15 days, as is the current practice in the Western Cape. This will allow departments to negotiate an early settlement discount, and they will avoid paying an exorbitant amount in penalties.