By Thapelo Molefe
The Public Service Commission (PSC) has sounded the alarm over a deepening crisis of unpaid government invoices, warning that persistent non-compliance with payment regulations is crippling small businesses and undermining economic recovery.
Releasing its combined third and fourth quarter bulletin on Wednesday, the commission said tens of billions of rand owed to service providers remain unpaid beyond the legally mandated 30-day period.
PSC Commissioner Anele Gxoyiya said there has been “no overall improvement” in departments settling invoices on time, despite legal obligations under the Public Finance Management Act (PFMA).
According to National Treasury data cited by the commission, 95,399 invoices worth R12.4 billion were unpaid beyond 30 days in the second quarter of the 2025/26 financial year — a 17% increase from the previous quarter.
“This entrenched non-compliance underscores the urgent need to enforce payment discipline through consequence management,” Gxoyiya said.
Provincial departments were identified as the worst offenders.
The Eastern Cape recorded the highest number of unpaid invoices at 46,583, valued at R3.8 billion.
Gauteng had the highest value of unpaid invoices, while KwaZulu-Natal led in both the number and value of late payments.
In contrast, Limpopo reported no late or unpaid invoices, a performance the commission said proves compliance is achievable.
The PSC warned that late payments are not only a governance failure but are devastating for small, medium and micro enterprises, many of which are forced into debt or closure due to cash flow disruptions.
“Some have even closed down as a result of this non-payment,” Gxoyiya said.
He added that fear and intimidation are preventing some suppliers from speaking out.
“Some of the service providers sit with the pain of being unpaid whilst they continue to render services, because some of them are threatened that should they fight, they won’t get any opportunities again,” he said.
The commission has urged affected businesses to report non-payment, assuring them that follow-ups will be made with defaulting departments.
The trend, the PSC said, contradicts the National Development Plan’s goal of reducing unemployment by 2030.
It also flagged weak consequence management across departments, describing accountability measures as largely ineffective, and said it would engage the Auditor-General to strengthen action against non-compliant accounting officers.
Common reasons for delays include budget constraints, administrative inefficiencies, disputed invoices and weak internal controls.
Beyond financial mismanagement, the bulletin points to broader systemic strain in the public service.
A study on hybrid working arrangements found more than half of departments still lack formal policies, despite the shift toward flexible work after COVID-19, raising concerns about inconsistency, potential discrimination and inefficiencies.
Grievances among public servants are also rising.
By the end of December 2025, 406 grievances had been recorded.
While two-thirds were finalised, many remain unresolved, mostly linked to unfair treatment, salary disputes and recruitment processes.
Complaints to the PSC increased by 176 cases year-on-year, largely relating to personnel practices and administrative failures — further evidence of persistent governance weaknesses.
Despite these concerns, the PSC acknowledged progress in anti-corruption efforts, citing arrests, dismissals and disciplinary actions as signs of improved enforcement.
However, it warned that fear of victimisation continues to deter whistleblowing, weakening accountability mechanisms.
The commission reiterated its call for stronger whistleblower protections and ethical leadership across the public service.
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