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Govt departments urged to pay small businesses

May 8, 2020
Govt departments urged to pay small businesses

East London - As COVID-19 continues to put businesses under immense pressure, putting jobs on the line, the Public Service Commission (PSC) has encouraged departments to engage suppliers to resolve outstanding payments and speedily process Small Medium Micro Enterprises’ (SMME) invoices.

This in a bid to minimise the negative impact of the lockdown on business and jobs.

“Business is under enormous duress now, with most facing a bleak future due to the nationwide lockdown. Departments are urged to put measures in place to ensure that all suppliers, in particular, small businesses are paid for services rendered and goods delivered,” the PSC statement read.     

The PSC's role is to empower, investigate, monitor, and evaluate the organisation and administration of the Public Service.

According to the statement released on Thursday, the Public Finance Management Act (PFMA) still applies and all efforts must be made to ensure that suppliers can also continue to operate and pay their staff and suppliers beyond the lockdown.

“We wish to reiterate President Cyril Ramaphosa’s call for government to ensure that suppliers are paid within 30 days,” PSC's spokesperson, Humphrey Ramafoko said.

He said non-compliance with the PFMA must be viewed as transgression and must be treated as such. 

“Failure to pay suppliers on time has dire consequences for the sustainability of SMME’s, impacts negatively on the government’s job creation initiatives particularly during this period when government is trying to prevent massive job losses and compromises government’s performance and service delivery.”

He also said that strategies must in place to deal with the 30-day requirement for payment of suppliers, the payment of contract workers as well as processing documents with speed for those exiting the system.

“Furthermore, the PSC encourages departments to put in place supportive measures for public servants that retired during the lockdown period,” he added. – SAnews.gov.za

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