The Gauteng government owes suppliers R1,7-billion in outstanding fees, provincial minister of finance Mandla Nkomfe said on Tuesday.
”Estimates indicate that there is currently R1,7-billion in outstanding payments,” he told reporters in Johannesburg, adding that an operation was under way to ensure the money was paid.
”Operation Bhadala is the provincial government’s initiative to ensure that all outstanding invoices for goods and services rendered and delivered are paid by the end of September this year,” said Nkomfe.
A total of R342-million of payments had already been processed in the past three weeks.
”It is our firm belief that the operation will bring some much-needed relief in the effort to contribute to the sustainability of the SMME [small, medium and micro enterprises] sector,” said Nkomfe.
”This difficulty basically arose at the end of last year, by October, November, and there were a number of reasons why we got into that situation.”
These included faulty internal processes, he said.
”Some departments are not managing their processes very well.”
Another problem was unauthorised orders.
”Someone would just pick up a telephone and order something. When you ask who ordered this particular item, nobody knows.”
Also, last year the government had ”a problem of declining resources at collection in terms of taxes”, said Nkomfe.
Another factor was that the national government decided to reallocate some money from provinces to the electricity utility.
”About R60-billion meant for provinces … was taken to Eskom and it meant that the money that was supposed to come to the province would be very limited.”
Nkomfe said the departments of health, housing, education and road and transport relied heavily on suppliers.
But he assured suppliers that if they had followed the correct invoicing procedures, the money owed would be paid out by end September. — Sapa