City pays 99,5% of suppliers within 30 days, boosting local economy

15 March 2023

The City pays on average 99,5% of supplier invoices within 30 days. This ensures that small and medium-sized businesses are able to keep their cash flow consistent and contributes to ongoing operations. The City has put in place a number of contract management processes over the past few years to ensure that businesses are paid on time in Cape Town, contributing to meaningful economic growth and job creation. 

'Approximately R12,7 billion has been spent on purchase orders during the current financial year, both in operational and capital budgets. The City is committed to paying suppliers in good time to support business enablement and ensure the delivery of services to residents. This also boosts the local economy, creates jobs and protects livelihoods. The City is able to do this because of its successful contract management and transparent tender processes. The City regularly monitors its purchase order processes to ensure adherence to timelines.

'An important improvement to streamline the payment process was the introduction of electronic submission of invoices. Suppliers were assisted to submit invoices and statements electronically through guidelines published on the City's website and various communications. During the national Covid-19 lockdown all suppliers submitted invoices electronically, and the trend continues. Suppliers are, however, still able to submit paper invoices should they wish. We thank our City teams, customers and suppliers in helping Cape Town to reach new customer service delivery standards,' said the City's Mayoral Committee Member for Finance, Councillor Siseko Mbandezi.

Where payment of suppliers is not completed within 30 days, it is due to various reasons, often out of the City's sphere of influence, including poor quality of goods or services, goods not yet fully received and incorrect supplier details.

Legislative context – City may not operate like the private sector does

The City functions within a context governed by various laws and regulations such as the Municipal Finance Management Act (MFMA), Preferential Procurement Act, Supply Chain Regulations and various directives and policies. The City, unlike the private sector, has to abide by these regulations in the procurement of goods, works and services.

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Published by:
City of Cape Town, Media Office