Government owes R7.1bn to SA businesses, but still talks about ‘supporting business’

President Cyril Ramaphosa joined by stakeholder representatives from small business owners, blue collar workers and emerging entrepreneurial innovators ahead of signing the Competition Amendment Bill into law at the Tuynhuys Media Centre in Cape Town. 13/02/2019, Elmond Jiyane, GCIS

President Cyril Ramaphosa joined by stakeholder representatives from small business owners, blue collar workers and emerging entrepreneurial innovators ahead of signing the Competition Amendment Bill into law at the Tuynhuys Media Centre in Cape Town. 13/02/2019, Elmond Jiyane, GCIS

The state is talking about improving economic growth while simultaneously strangling the businesses expected to drive it.

The South African state is facing a collapse, measured by its inability to pay service providers, manage appointments, carry out disciplinary action, combat wasteful expenditure and prevent corruption. The government’s responses to a series of parliamentary questions over the past few weeks reveal terminal decay in the ANC’s ability to manage the South African public sector.

The ANC’s mismanagement of the public service is directly undermining any hope of our economy recovering from recession. Combined, national and provincial government departments currently owe South African businesses – the engine of economic growth – over R7.1 billion in unpaid invoices older than 30 days.

National government owes businesses R634 million. The Department of Water and Sanitation is the single biggest offender, owing businesses R492 million, followed by Agriculture owing R99 million and the Police owing R24 million. Provincial governments owe businesses an additional, staggering, R6.5 billion. Gauteng and the Eastern Cape – both provinces run into the ground by the ANC – have failed to pay for services to the tune of R2.6 billion and R2.1 billion, respectively.

While the ANC cannot pay service providers in a timeous fashion, they seem to have no problem paying billions to public servants illegally doing business with the state. National Treasury’s 2018 Public Procurement Review found that 2,704 state employees conducted business with national and provincial departments between 1 April 2017 and 31 January 2018.

The ANC spent R8.1 billion of public funds to pay these public servants who illegally conducted business with the state. Despite this being in direct contravention of the 2014 Public Administration Management Act, the Minister of Public Service and Administration revealed in response to a parliamentary question that not a single public service employee has been held accountable or fired for doing business with the state.

The ANC also seems to have no problem paying millions to cadres implicated in misconduct to sit at home. By 30 June 2019, the government had already spent at least R26 million on the salaries of public servants placed on “precautionary suspension”.

At the same time, the government has no system in place to conduct lifestyle audits to proactively identify politicians and public servants living beyond their means. The Minister for Public Service and Administration simply stated that his department “is not mandated to conduct lifestyle audits on members of the Executive.”

In other words: the ANC has no intention to combat corruption among its ministers. The minister’s reply also revealed that the long-promised Technical Unit tasked with conducting lifestyle audits on public servants, is still not operational and will not do any work until at least next year.

The ANC is crippling South African businesses through its failure to pay for services on time, paying billions to public servants illegally doing business with the state or placed on “precautionary suspension,” and completely failing to act against corruption in the public sector. The DA reiterates our call for a comprehensive public spending review. We will also continue fighting for fundamental reforms that creates a lean, efficient and capable state that creates opportunities for South Africans to prosper.

Schreiber is a DA MP and the shadow minister of public service and administration and writes in his personal and party capacity

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