Treasury releases new public procurement rules after tender suspension imbroglio

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Treasury director-general Dondo Mogajane.
Treasury director-general Dondo Mogajane.
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  • National Treasury released new draft regulations for government tenders on Friday.
  • This brings government procurement back in line with the system that existed before the 2017 iteration of the rules.
  • It also does away with the set-aside rules that Afribusiness NPC contested in court. 

National Treasury released updated government tender regulations for comment under the Preferential Procurement Policy Framework Act on Friday, ending the uncertainty that had put government tenders on hold since mid-February.

On 25 February National Treasury issued a circular stating that the issuing of tenders would be "held in abeyance" after the Constitutional Court dismissed an appeal by the Finance Minister Enoch Godongwana to overturn an earlier court judgment which had set regulations signed in 2017 aside. 

The case was brought by Afribusiness NPC, arguing that the 2017 regulations were unfair because they allowed for "pre-qualifications" to be set for tenders. For example, state institutions could declare that only black-owned businesses qualified to tender.

The regulations gazetted on Friday restore the system that existed before the 2017 iteration of the rules and do away with the pre-qualification rules that Afribusiness NPC contested in court.

READ | No more tenders: Govt entities react to Treasury's request as it 'seeks clarity'

Under this system, the formula for scoring points in tender awards proposes a 80/20 BEE preference point system for the acquisition of goods with a value of up to R50 million and a 90/10 BEE preference points system for goods valued higher than R50 million.

National Treasury Director-General Dondo Mogajane said last week that the department had sought urgent clarification from the Constitutional Court on its ruling and that in the meantime tenders would be suspended, although Eskom has continued issuing tenders during this period.

With Carol Paton

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