Gauteng pays suppliers over R700m

Department spokesperson Simon Zwane said R736m was paid to service providers by last Friday.

"A total of R386m was paid for medical supplies, while R150m was paid to National Health Laboratory Services (NHLS) and a further R50m was paid to South African National Blood Services (SANBS)," Zwane said.

He added that the Gauteng Provincial Government had identified a potential R1bn in cash to pay for service providers in the provincial health department, which will culminate to a total R1.6bn to be paid by the end of 31 March 2012.

He said a payment plan had been developed and will form the basis for engagement with all affected suppliers, whilst the verification process of invoices is on-going.

"In order for service providers to continue supplying medicine, the following has been implemented: the payment run for suppliers of essential medicine was processed [on Saturday] and this includes the payment to NHLS and SANBS."

In the coming week, Zwane said, the Gauteng provincial team will initiate a process of negotiating with individual service providers around the payment plans towards redeeming debt owed to suppliers.

The department reiterated that it is fully aware and committed to meeting all its past and future obligations to its suppliers, and is committed to addressing the challenges it faces in the slow payment of service providers. The department hopes to settle the matter by June 2012.