Mpuma govt pledges to pay service providers faster

Thursday, April 21, 2011

Mbombela - Mpumalanga Premier David Mabuza and his MECs have promised to pay service providers within 12 days of receipt of their invoices instead of a month.

The decision was reached during an executive council meeting held in Mbombela on Wednesday, where council members approved a proposal from the provincial public works, roads and transport department to process payments for service providers within 12 days.

"The [new approach] will be realised through the reconciliation of quality control measures and the supply chain process by establishing a one-stop Payment Approval Committee," said provincial government spokesperson, Lebona Mosia, on Thursday.

Mosia said the committee would comprise all role players from all departments who would meet on a weekly basis to approve and process every payment owed to service providers.

The provincial office of the National African Federated Chamber of Commerce and Industry (Nafcoc) has applauded the provincial government for the move. 

"As Nafcoc, we are very excited to see the provincial government implement this kind of turn-around strategy. This will mean that small businesses won't be shut down because government has failed to pay them in time," said provincial Nafcoc spokesman Gay Mokoena.

Mokoena said the decision, if implemented, would save jobs and help businesses expand while creating more jobs at the same time.

Congress of the South African Trade Unions provincial secretary, Fidel Mlombo, also welcomed the move.

"This is good news to service providers in the province, especially small medium and micro enterprises (SMMEs) and their employees. This also proves that the provincial government is committed and prepared to work with service providers to protect jobs and create employment," said Mlombo.

During his state of the province address in February, Mabuza acknowledged that a number of businesses, particularly SMMEs, were forced to shut down due to government's failure to pay on time.

"This has a negative impact on the economy and our ability to create and retain jobs. Our turnaround time of paying service providers within 30 days still stands," said Mabuza. "We cannot afford a situation where our service providers are not paid on time."

At the time Mabuza threatened managers and officials with disciplinary action, should they not adhere to the commitment.

"We cannot afford to keep officials who are not prepared to take the interests of our people to heart," said Mabuza.

Mabuza said the provincial government had set a target to create 720 000 jobs between this year and 2020.

Mpumalanga lost a total of 82 000 jobs in the 2009/2010 financial year, including 29 000 that were lost in the first quarter of 2010.

During the same financial year, the provincial education department alone told the provincial legislature that it owed accruals and commitments amounting to R292 million and R438 million respectively. - BuaNews