Johannesburg - The Department of Health in Gauteng owes R1.209 billion to 823 companies for goods and services, money which has been due for more than 90 days even though it must legally be paid within 30 days, the Democratic Alliance party said on Monday.
In a statement, DA provincial legislator and head of health Jack Bloom said Gauteng member of the executive council for health Bandile Masuku had made the admission in a written response to questions in the legislature.
According to Bloom, Masuku said only 68 percent of companies were paid within the 30 day period as at March 31.
"The department had previously experienced cash flow challenges which resulted in unavailability of cash to settle obligations timeously," Masuku was quoted as saying.
"The majority of transactions that were not paid as at 31 March are those transactions where the department had entered into payment plans with the service providers. The 2020/2021 financial year is the last year for the settlement of the payment plans.”
Bloom said it was disappointing that so many companies were still owed huge amounts of money by the Gauteng health department, which he said had a notorious record of poor financial management.
"Some of these companies may have to close and lay off workers due to the Covid-19 crisis," said Bloom.
"It is still unclear why the department’s chief financial officer resigned recently, but I hope her successor does what is necessary to ensure that all companies are paid in good time."