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The recent Stats SA Quarterly Labour Force Survey results showed that our unemployment rate stands at a dismal 29%, the highest since 2008.
There is an absolute need for action.
Soon after that President Cyril Ramaphosa said in his feedback on interventions that have been implemented stemming from the Jobs Summit, that we are in a deep crisis economically and we must innovate and be creative in tackling this crisis.
While innovation and creativity are needed to turn the economic and job creation situation around, there are also very simple tasks we must continue doing to keep the economy growing and to stem job losses.
Just over two weeks ago I launched a campaign within the department of public works and infrastructure to ensure that we pay service providers, especially small to medium enterprises (SMMEs) – which are the lifeblood of our economy – on time within the stipulated 30 days.
As of last month, the department had 2 084 invoices which had passed the 30-day stipulated payment period. By July 31, 1 633 of those invoices valued at R81.7 million had been paid.
Major construction projects and day-to-day maintenance constituted 94% of all overdue invoices.
The construction industry, which does most of the department’s work, is a key job creator and can grow even more and employ more people.
In September last year, the president announced a stimulus and recovery plan to inject money into the economy and to, among others, “ignite economic activity, restore investor confidence, prevent further job losses and create new jobs”.
In his state of the nation address, he also stated: “Ultimately, the growth of our economy will be sustained by small businesses, as is the case in many countries. It is our shared responsibility to grow this vital sector of the economy. Government will honour its undertaking to set aside at least 30% of public procurement to SMMEs, cooperatives and township and rural enterprises.”
In light of the president’s call, I reported the following:
- As at July 31, 17 106 invoices had been settled for that month.
- The department is making significant headway, having settled 12 889 of the above invoices within 14 days. Thus, the department injected R1.2 billion into the economy last month alone.
- The impact of paying suppliers on time, especially SMMEs, is significant and we must diligently carry out our responsibility towards the economy.
I have initiated a contract and consequence management system to ensure suppliers are paid timeously.
The staff have been asked to provide me with a daily update of payments made. There will be consequences for officials who do not meet the 30-day payment deadline.
I am determined to end the late payments.
I have been stressing the Batho Pele principle of “putting people first” to the department’s leadership on a daily basis.
If we could finalise most of the 2 084 late payments within the stipulated period, then it shows that there is no need for late payments to happen in the first place.
Where there are issues which the suppliers have to resolve, we must communicate with them to rectify any issues so that they can get paid on time and keep their businesses going.
The impact of suppliers not being paid on time often means that they cannot pay salaries or other costs related to keeping their businesses afloat.
In some cases many businesses, especially SMMEs, go under as a result.
Our economy is suffering and everything we do must be done with urgency.
Our task is to ensure that we create the conditions for economic growth and job creation in the private sector, not to delay or stifle that mission.
During these trying times, all South Africans must unite for the good of our country and do everything we can to pull through this economic crisis.
Government must lead that task and set the right example such as paying all suppliers on time.
De Lille is minister of public works and infrastructure
