KZN Finance MEC Francois Rodgers attributes contractor payment delays to the Department of Transport's financial mismanagement, revealing R2.6bn debt and outlining measures to restore trust and financial stability.
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KwaZulu-Natal Finance MEC Francois Rodgers has pushed back against claims that the provincial treasury is responsible for delayed payments to contractors, instead placing the blame squarely on the Department of Transport’s financial management practices.
Addressing growing concern across the province, Rodgers said the department began the 2026/27 financial year with an accumulated debt of R2.6 billion owed to contractors and service providers.
“The Department of Transport started the year already owing contractors R2.6 billion. This has nothing to do with Provincial Treasury not transferring funds,” Rodgers said.
He explained that the province’s R168 billion budget is allocated to departments through equitable share transfers from National Treasury, distributed in 12 monthly tranches. The Department of Transport receives approximately R8.8 billion annually, equating to between R500 million and R800 million per month.
Rodgers said the core issue lies in departments committing to contracts without having sufficient cash flow to honour those obligations.
“What we are seeing is departments undertaking work when they know they don’t have the necessary cash backing. This cannot be allowed to continue,” he said.
He added that Treasury would intensify oversight and engagement with departments to prevent recurring payment delays, stressing that timely payments are essential for maintaining trust with contractors and supporting economic growth.
“It’s important that we treat contractors and service providers with respect. That’s how we build integrity in government and ultimately grow the economy and create jobs,” Rodgers said.
Meanwhile, Transport and Human Settlements MEC Siboniso Duma acknowledged the payment challenges following a meeting with contractors in Merebank earlier this week.
Duma said the engagement, held at Inkosi Mhlabunzima Maphumulo House, focused on finding solutions to delays affecting projects tied to the province’s 34,000km road network.
“Despite challenges around delayed payments, we appreciate the constructive inputs from contractors as we work together to build a prosperous KwaZulu-Natal,” Duma said.
The department announced a series of interventions — dubbed the “Merebank resolutions” — aimed at restoring financial stability and improving contractor relations.
Key measures include the establishment of an “Invoice-checking war room” led by Head of Department Zibusiso Dlamini to fast-track payments, as well as the rollout of a digital invoicing system to improve transparency and eliminate preferential treatment.
The department also plans to limit new infrastructure projects until outstanding invoices are settled and centralise financial functions to strengthen accountability.
In addition, Duma said engagements were underway with the national Department of Transport to shift grant payments from quarterly to monthly disbursements, easing cash flow pressures.
The department confirmed it would reconvene with contractors within three months to assess progress on the interventions.
Duma also highlighted past financial decisions that impacted the department’s liquidity, including the redirection of R364 million from infrastructure budgets to support scholar transport under the Department of Education.
While that intervention ensured uninterrupted schooling, particularly for matric learners, it further strained funds available for contractor payments.
The department further noted that approximately R3 billion collected annually from vehicle licensing and renewals is redirected to the provincial treasury for broader government use.
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