KZN health department says it owes service providers R1.7bn

The KwaZulu-Natal department of health is in a shambles and owes service providers R1.7bn.

This comes after the provincial department was in the news for alleged medicine shortages.

On Monday scores of service providers embarked on a protest march demanding their money. Some said the department had not paid them for more than a year. They included SMMEs, which are — according to legislation — supposed to be paid within a month of rendering services.

DA KZN spokesperson on health Dr Imran Keeka called for consequences.

“The DA notes with concern that businesses in KwaZulu-Natal are owed an estimated R1.7bn by the provincial department of health. The staggering sum is revealed in response to a DA written parliamentary question,” said Keeka.

He said the reply further indicated that, of this, R1.33bn fell within the 60-day to 90-day payment period.

There were 1,519 unpaid invoices in the over 90-day period, amounting to just more than R71m.

“The DA notes that KZN health MEC, Nomagugu Simelane-Mngadi, has always been open and forthright about her department’s financial woes during portfolio committee meetings. However, such a situation — the nonpayment of suppliers on time — should not have arisen in the first place or to the point where they are affecting services.,

Keeka said the concern arising out of the reply was that it was very possible that small and medium sized companies in KwaZulu-Natal were the worst affected.

“Equally concerning is that the MEC and acting HOD intimated, during the same meetings, that some service providers, while paid, had not paid their staff. This had led to protests, in some instances implicating the department. However, what happens within companies once the department has concluded its business with them is beyond its control.”

Keeka said the department had unfortunately adopted a “take from Peter to pay Paul” approach in a bid to resolve some of the payment issues.

“This appears to have left some companies struggling more than others. Again, it particularly affects small businesses. Regrettably, this resulted in several suppliers gathering at the department’s Pietermaritzburg head office on Monday, demanding payment.”

Currently the Division of Revenue Bill, or the budget, as presented by finance minister Enoch Godongwana on March 12, is withdrawn, with provinces set to table their budgets within two weeks of May 21. Once the province's budget is tabled and certainty exists, it is expected that the situation may turn around.

Keeka described the situation as dire and in need of urgent attention.

The KZN health department communications unit did not respond to queries.

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