CAPE TOWN, February 25 – It is unacceptable that at a time when unemployment is at an all-time high and small businesses are struggling to stay afloat due to an under-performing economy the government fails to pay these businesses within the 30 day window period, the Democratic Alliance said on Sunday.
“One of the tests for President Cyril Ramaphosa’s first 100 days in office will be to ensure that more than 100,000 unpaid invoices worth over R7.7 billion, much of it to small businesses, is paid out as a matter of urgency,” DA spokesman Toby Chance said.
The DA would write to both Small Business Development Minister Lindiwe Zulu and Ramaphosa asking that they commit to a small business suppliers payment plan to clear the arrears currently due to hardworking men and women in the small business sector, he said.
In his oral reply to Members of Parliament on the state-of-the-nation address (Sona) debate, Ramaphosa said, “This is something that I want to see addressed as I visit government departments, because the culture of late payment has gone on for far too long and has caused far too much damage, particularly to emerging black businesses.”
Finance Minister Malusi Gigaba made a similar commitment during his budget speech when he said government departments and institutions that did not pay suppliers on time would be charged with financial misconduct.
The DA welcomed these commitments with cautious optimism, because previous promises made by government to pay small business owners what was due to them had not been met.
Responses to parliamentary questions submitted by the DA indicated that some of the major culprits in the non-payment of business suppliers to government included:
– transport department: Passenger Rail Agency of South Africa – R1.12 billion;
– public works department: property management and trading entity – R1.06 billion;
– water and sanitation department – R968 million;
– Transnet – R788 million; and
– Denel – R688 million.
“It is not acceptable that at a time when unemployment is at an all-time high and small businesses are struggling to stay afloat due to an under-performing economy the government fails to pay these businesses within the 30 day window period,” Chance said.
It would be impossible for government to achieve its stated aim that 90 percent of all new jobs be created by small businesses by 2030 if their cash flow was disrupted due to non-payment by departments who sent them from pillar to post with contempt.
“The DA looks forward to a concrete small business suppliers payment plan from the president’s office that would end the grief that small business owners have endured for years without recourse,” Chance said.
– African News Agency (ANA)