Provinces fail to pay contractors R896m owed

THE PROVINCES owed contractors that rendered services to the Human Settlements Department a whopping R896 million after they failed to honour payment of 1 085 payments as at May.

This was revealed by Human Settlements Minister Lindiwe Sisulu in reply to a parliamentary question from the DA’s Mbulelo Bara.

Gauteng was leading the provinces with outstanding payment of invoices totalling R597 million, followed by the Eastern Cape, which owed R176m and the Free State, R122m.

North West had not paid invoices totalling R5.4m, Mpumalanga R4.4m and Limpopo R529 631.

Gauteng had the most unpaid invoices, 824; Free State 277; the Eastern Cape 184; Limpopo 50; Mpumalanga seven; and Limpopo three for the period.

Only KwaZulu-Natal, the Northern Cape and Western Cape were not owing any contractors.

Sisulu said her department was still grappling with the payments of service providers within the stipulated time frame of 30 days.

“The challenges remain and are multifaceted,” she said.

Sisulu said the reasons provided by the provinces for the late payment varied from late submission of invoices to verification of information.

“Sometimes the required details for new suppliers are not always available in the financial system to facilitate payments, due to inadequate completion of the registration forms by suppliers,” she added.

The Eastern Cape blamed non-payment on the “shrinkage” of the equitable share due to commitments and “top slicing” of its budget.

She said the Free State not paying contractors in the 30-day time frame was due to insufficient funds being available. “Free State has commenced honouring these claims in the 2017-18 financial year.”

According to Sisulu, Gauteng could make payments because the first payment tranche was made by her department late in May .

She said the province’s business plan was not approved due to non-compliance, and the Division of Revenue Act prohibited transfer of funds before the approval of a business plan.

Limpopo had experienced delays in registration of contractors with the central database system.