Sunday, July 5, 2020

Ministry recycling same answer on late payment of suppliers

The answer on a still persistent problem that the Minister of Finance and Economic Development, Dr. Thapelo Matsheka, gave to parliament two weeks ago is essentially no different from the one that one of his predecessors gave more than a decade ago.Possibly based on his own experience of doing business with the government, the Kanye North MP, Thapelo Letsholo, raised concern through a parliamentary question about the late payment of suppliers by government departments. By any reasonable standard, the latter is a crisis and is the reason why some small businesses, some funded by the government itself, have collapsed.

Matsheka’s answer didn’t cast the problem in crisis terms but was assurance to the house that the ministry has processes and systems in place to ensure that suppliers get paid on time.It would seem that the C-suite of the Ministry of Finance and Economic Development has a microwave that it uses to heat up an answer on late payment and hand it over to the minister to serve steaming hot to parliament. Matsheka’s answer was no different from one that Baledzi Gaolathe gave more than a decade ago when he was finance minister. Then, as now, there was a crisis of suppliers being paid late and not being able to keep their businesses running. Like Matsheka, Gaolathe didn’t cast the problem in crisis terms but gave assurance that the ministry had processes and systems in place to ensure that suppliers got paid on time.

In his response, Gaolathe had said that if payment is not made within the stipulated timeframe, companies had the option of claiming a 2 percent surcharge. In his own response, Matsheka said that suppliers could exercise the option of charging interest if they are paid after 30 days. This is stipulated under Regulation 91 of the Public Procurement and Asset Disposal Act. It remains unclear why unclear why such interest can’t accrue automatically. One very likely outcome is that adding a surcharge to the bill will result in officers who delayed payment being penalized somehow. Those officers will, in turn, certainly want to punish suppliers who charge interest.

The most curious aspect of this answer is not who reads it in parliament but who actually writes it and why it is crafted in a particular manner. While ministers are responsible for the statement they give to parliament, such statements are written by senior officials in their respective ministries. Where complaints are raised about service delivery, the same senior officials who are responsible for solving problems, also get to explain away why problems remain unsolved. In the particular case of late payment to suppliers, senior officials in the Ministry of Finance and Economic Development, who are supposed to have long solved this problem, are also the ones who get to write statements explaining away this failure. Whoever happens to be finance minister is given this statement to read to parliament. It is likely that both Gaolathe and Matsheka’s response was written by the same officer.

This phenomenon is not confined to the Ministry of Finance and Economic Development. In his inauguration speech last month, President Mokgweetsi Masisi touted a programme that has actually failed, the Education and Training Sector Strategic Plan, as a resounding success. Developed with the assistance of the European Union, this Plan was to be implemented between 2015 and 2020 but with only one year left, has become just another government document that is long on beautiful promises but short on actual delivery.

Rather than admit that it is failing, senior officials at the education ministries, who contributed to the president’s speech, have instead resorted to obscuring that fact.  Curiously, the opposition has never waged a sustained and systematic campaign around the late payment problem which, despite what some say, has actually reached a crisis point.

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Sunday Standard June 28 – 4 July

Digital copy of Sunday Standard issue of June 28 - 4 July, 2020.