Payment headache: Phaahla explains why health depts are struggling to pay the bills on time
Subscribers can listen to this article
Health Minister Joe Phaahla. (Photo by Luba Lesolle/Gallo Images)
Joe Phaahla says the Eastern Cape health department is experiencing challenges in paying creditors within the stipulated time.
The accruals and payables faced by the department amounts to more than R17 billion.
Limpopo’s health department paid 99% of valid invoices received on 31 March 2023.
The Eastern Cape health department is struggling to pay service providers within 30 days because of unbudgeted accruals and outstanding payables totalling more than R17 billion.
Health Minister Joe Phaahla revealed this in a written parliamentary reply on Monday.
He was responding to the EFF’s Rosina Ntshetsana Komane, who asked why Phaahla’s department failed to pay service providers in the stated period.
The National Treasury says the “legislative requirement” is for national and provincial departments to pay service providers within 30 days.
Phaahla was asked what steps his department had taken to remedy the situation.
The minister said the Eastern Cape health department had been, and was still, experiencing challenges in paying creditors within the stipulated time.
He said:
This is due to accruals and payables from the 2019/20 financial year. Cumulatively, these accruals and payables amounted to R17 102 billion. They are not budgeted for; instead, they consume the budgetary allocation in a particular financial year. In other words, with its limited equitable share allocation, the department attempts to prioritise the payment of the small, medium and micro enterprises (SMMEs), which are the priority of the present administration, and partially pay the major suppliers who supply medication for the patients.
He said the department negotiated with the foremost medicine service providers to continue rendering services for the sake of patients.
“If patients cannot get the medication, the department can and is exposing itself to be sued by the health services’ consumers,” Phaahla wrote.
He said the provincial department had negotiated with the Provincial Treasury to finance the accruals and payables. It had also increased its legal capacity to fight the medico-legal cases as these had been a significant source of the high value of payable expenses due.
READ |
“While the department is doing everything possible and committed to complying with the 30-day payment instruction, the current demand for services and the inadequate budget allocation make it challenging to meet this obligation,” Phaahla said.
The Limpopo health department paid 99% of valid invoices received on 31 March 2023.
The minister said the 1% of late payments was due to “slowness”, the payment system being down or “negligence on the part of officials”.
He said that, in Mpumalanga, most service providers were paid within 10 days.
“However, some invoices are disputed due to incorrectness,” he said.
We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won’t be billed.
Subscribe to News24
Most Read
For Subscribers
LISTEN | Loftus darling Derick Hougaard is fighting for his life in hospital. What we know so far
WATCH | Two Tshwane metro officers allegedly accost AfriForum official in court
Busisiwe Mkhwebane says her strange Reserve Bank order, which she said was an order, wasnt an order
BREAKING NEWS LIVE | Police open inquest docket after Joemat-Pettersson’s death
Polish palaver: EFF demands that South Africa downgrade Poland embassy after being ‘undermined’
Derick Hougaard: Former Bok fighting ‘greatest battle’ as loved ones surround him in Pretoria
Carol Paton | A Mashatile presidency may be coming soon. What does he stand for?
Sifiso Skenjana | NHI is just another example of SA’s policymaking crisis
Busisiwe Mkhwebane says her strange Reserve Bank order, which she said was an order, wasnt an order
A ‘grossly dishonest’ Gauteng municipal CFO won’t get R2 million, and his job back, after all
Game On!