suppliers

Government departments continue to experience challenges with paying suppliers on time, says Public Service Commission (PSC) Commissioner Michael Seloane.

Addressing a virtual media briefing on the Quarterly Bulletin titled: The Pulse of the Public Service, he said the most noteworthy were the departments of Public Works and Infrastructure (including Property Management and Trading Entity (PMTE) and Water and Sanitation (including Trading Entity).

“As at the end of quarter 3 (December 2020), Public Works and Infrastructure (including PMTE) reported an increase in the related cost owed to suppliers from R40 476 552 for 128 invoices at the end of quarter 2 (September 2020) to R51 673 929 for 116 invoices in quarter 3.

“Although Water and Sanitation (including the Trading Entity) report a decline in the related cost, from R544 838 250 for 641 invoices to R357 636 504 for 480 invoices during the same period, it is still one of the departments that should be monitored closely,” Seloane said.

The South African Police Service also needs to be monitored closely as it reported a notable increase this quarter.

“This includes the South African Police Service which for this quarter reported a notable increase from October to December 2020; R512 for 1 invoice (end October) to R71 674 for 17 invoices (end December).

“Further to this, Mineral Resources and Energy reflects a significant increase in the amount owed to suppliers, from R876 202 for 2 invoices at end of quarter 2 (September 2020) to  4 311 452 for 15 invoices at end of quarter 3 (December 2020).

“Similarly, Home Affairs owed R90 604 for 8 invoices at the end of quarter 2 (September 2020) to R 636 813 for the same number of invoices at the end of quarter 3 (December 2020),” the Commissioner said.

He said in the case of Women, Youth and Persons with Disabilities, there is still no follow through on consequence management regarding its invoice of R1 712 016, which has become a staring feature of the department, starting from quarter 1 of the 2020/2021 financial year.

“The department must realise the importance of paying suppliers on time as this impacts on their business operations. This might be as a result of gross negligence on the part of the Department and thus shows a lack of consequence management or accountability,” the Commissioner said.

He expressed concern at departments such as the Civilian Secretariat for the Police Service, Agriculture, Land Reform and Rural Development, Environment, Forestry and Fisheries, and Mineral Resources and Energy, who despite the regulatory requirements are still not submitting the required information to the National Treasury on time.

“In the case of Environment, Forestry and Fisheries, the department has not submitted any reports as per Treasury regulations for the 2020/21 financial year.

“The information from National Treasury indicates that the Civilian Secretariat for the Police Service submitted reports for October and November 2020, however, reports for quarter 1 and 2 were not submitted.

“Similarly, Land Reform and Rural Development only submitted reports for April 2020 (quarter 1) and October 2020 (quarter 3) with no reports submitted for quarter 2 (July, August and Sept 2020),” Seloane said.

He said the conduct of these departments shows a flagrant disregard of the Public Finance Management Amendment Act (PFMA) and the Instruction Note 34 of the National Treasury regarding timeous reporting.

“Furthermore, this shows that accountability and consequence management within these departments are non-existent, especially since the PSC raised this concern on numerous occasions,” the Commissioner said.

The provincial status shows that the Eastern Cape, Free State, Gauteng, KwaZulu-Natal and North West were the major contributors of invoices older than 30 days not paid, as at the end of quarter 3 for the 2020/21 financial year.

“There has not been any major improvement in the payment of suppliers for quarter 3 (December 2020) in comparison with quarter 2 (September 2020) of the 2020/21 financial year.

“Of noteworthy is Mpumalanga that seems to have reverted to non-submission of reports similar to quarter 1 of 2020/21,” he said.

The Pulse of the Public Service Bulletin covers the period 1 October 2020 to 31 December 2020. 

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