15 March 2017

South Africa: Govt Intervention On Invoices Leads to Payment

Cape Town — Intervention by a special unit set up to ensure departments pay invoices to service providers on time has led to invoices amounting to R280 million being paid.

This came to light on Wednesday when the Department of Planning, Monitoring and Evaluation (DPME) appeared before a Parliamentary Committee tasked with providing oversight over the department. DPME gave an update on the progress that departments have made on the payment of outstanding invoices to service providers.

Irene Mathenjwa, the Outcome Facilitator: Public Service at the DPME, said the payments were made after the special unit lodged cases and conducted investigations on the non-payment and legitimacy of invoices.

"Through the unit, in the last [approximately] 15 months, we have been able to [oversee that] about R280 million is paid to service providers that came to us, not just national departments but [also] municipalities, entities, national and provincial departments," Mathenjwa said.

The special unit, established in April 2015, was set up to assist service providers whose invoices have not been paid by government within 30 days amid concerns that the non-payment had a negative impact on small businesses.

Mathenjwa said to date, a total of 190 cases have been lodged through the unit and that out of these, 68 were resolved and closed.

She said in 30 cases, payments were made, however, there were still outstanding amounts.

Some 38 cases are still under investigation and 54 are either still under litigation or in dispute.

How departments fare in paying invoices

Earlier, Mathenjwa presented a progress report of how national and provincial departments have fared in paying suppliers after 30 days from the date of receipt between October and December 2015.

She said 9 362 invoices were paid in October, 11 428 in November and 10 626 in December - which represents a regression of 2 066 between October and November, and a slight improvement of 802 invoices from November and December 2016.

"The average number of invoices paid after 30 days from October to December 2016 was 10 472, which indicates an improvement of 4 261 invoices when compared to an average of 14 733 that were paid after 30 days during the same period last year [October to December 2015]," she said.

Mathenjwa said the rand value of invoices paid after 30 days from the date of receipt was R147 million for October 2016, R181 million for November 2016 and R217 million for December 2016.

She said of the 40 national departments, 12 have maintained a clean record of paying all invoices on time.

Another 12 have demonstrated an improvement in the payment of invoices during the third quarter of 2016/17.

Invoices older than 30 days and not paid

Mathenjwa said the number of invoices older than 30 days and not paid were 7 960 (October), 1 295 (November) and 11 680 for December 2016.

This, Mathenjwa said, represents an overwhelming improvement of 6 665 invoices from October to November 2016 and a notable regression of 10 385 invoices during November to December 2016.

She said this translates to R96 million in October 2016, R59 million in November and R33 million in December.

Mathenjwa said this represents an improvement of R37 million from October to November 2016 and a further improvement of R26 million from November to December 2016.

The rand value of invoices older than 30 days and not paid in December 2016 amounted to R33 million, which is an improvement of R400 million when compared to R433 million in December 2015.

"Of the 40 national departments, 19 departments did not have unpaid invoices.

"Eleven have demonstrated an improvement in eradicating invoices older than 30 days and unpaid," she said.

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