Pretoria - In a bid to improve its cash flow and avoid accruals in the next financial year, the Gauteng Health and Social Development Department has committed to settling all supplier payments within 30 days.
The department said payments worth over R400 million are currently being processed per month in an effort to clear suppliers' debts.
"In the current financial year, the department paid R1 068 billion from its R22.5 billion budget to settle outstanding payments. The payments are being managed through cash flow allocation that the department receives from Treasury on a weekly basis," said department spokesperson Simon Zwane.
Zwane added that in processing these payments, SMMEs are prioritised as they receive their payments within 30 days of submitting their invoices. The department is also negotiating terms of payment with bigger suppliers so they can receive their payments on time.
The department acknowledged that at any given time, it will have accruals but they have to be managed and settled within reasonable time frames.
"Accruals do not mean outstanding payments from the previous financial year only, but refers to any account that a department or company currently has, even if it is less than 30 days," explained Zwane.
To improve financial management, the department has further introduced strict cost containment measures to ensure rational use of resources and bring expenditure within its budget in order to avoid compromising patients' care.
