South Africa infrastructure goals threatened by government late payments

South Africa’s infrastructure ambitions are being undermined by persistent late payments from the public sector, according to construction law specialists at MDA Attorneys. While President Cyril Ramaphosa and the Minister of Public Works and Infrastructure, Dean Macpherson, aim to transform the country into a major construction site to drive job creation, the financing reality for contractors is increasingly difficult.

National Treasury figures reveal that by the end of the third quarter of 2025/26, national and provincial departments owed a total of R15.5 billion across 90,856 invoices that remained unpaid for more than 30 days. The Department of Public Works and Infrastructure was identified as one of the primary offenders.

Legal experts note that the construction sector is heavily dependent on cash flow, as contractors must pay wages, suppliers, and subcontractors before recovering costs through interim payments. This delay forces contractors to act as unwitting financiers for government projects. While larger firms may have the working capital to absorb these costs, smaller contractors and subcontractors face significant financial struggles.