Gauteng Department of Health’s Non-payment Crisis Threatens Suppliers and Healthcare Stability
The South African Medical Technology Industry Association (SAMED) is raising the alarm over the Gauteng Department of Health’s ongoing failure to meet its financial obligations to medical technology suppliers – a crisis that now threatens business survival, jobs, and the stability of healthcare delivery across the province.
The Gauteng Health Department currently owes SAMED member companies more than R700 million. Despite fulfilling their contractual commitments and continuing to supply essential medical products and services, many companies have been forced to carry this debt burden for months without payment. To remain operational, suppliers are relying on costly loans and overdrafts simply to sustain cash flow and pay their employees.
SAMED Chairperson, Scott de Oliveira, notes that a recent member survey revealed several companies are on the brink of closure, with job losses imminent – even as South Africa prepares to host the G20 Summit, a global event intended to showcase Johannesburg and the country’s economic potential.
“As the upcoming G20 Summit demonstrates, our government is capable of decisive action and resource mobilisation when it chooses to,” says de Oliveira. “What is deeply concerning in the medtech payment crisis is the Gauteng Department’s lack of urgency to engage with us.”
Despite repeated formal requests from SAMED to meet with senior Gauteng Department of Health officials – including the Chief Financial Officer, Head of Department, and hospital Chief Executive Officers – no meaningful engagement has taken place. Meetings are frequently missed, and correspondence has gone unanswered.
“This reflects a worrying lack of accountability, urgency, and leadership from decision-makers,” de Oliveira emphasises.
The consequences of this inaction are far-reaching. The mounting financial strain on suppliers threatens not only the sustainability of small- and medium-sized enterprises but also the continuity of international subsidiaries that have invested in South Africa and are vital to the delivery of healthcare services.
“Disruptions in the medical supply chain place patients and healthcare professionals at risk,” warns de Oliveira. “Delays or interruptions in the supply of essential equipment, consumables, and support services could have devastating effects on hospitals across Gauteng.”
Several SAMED members have indicated that, unless the issue is urgently resolved, they will be forced to suspend supply to the Department, a decision that would further endanger patient care.
SAMED calls on provincial and national leadership to take immediate, decisive action to clear the payment backlog and to implement a transparent, sustainable payment framework that ensures future compliance and stability.
“It is irrational for government to champion economic growth and job creation through initiatives such as the MEDTECH Master Plan and the G20 Summit, while simultaneously eroding existing businesses and employment through maladministration,” concludes de Oliveira. “This crisis must be addressed urgently – to protect patients, preserve healthcare delivery, and rebuild trust between the public sector and its suppliers.”
SAMED urges the media, public, and stakeholders to bring attention to this issue and hold the Gauteng Department of Health accountable. Public awareness and pressure are essential to compel action and safeguard the integrity of South Africa’s healthcare system.
