Public Procurement Act to be phased in

The National Treasury has given the assurance that the Public Procurement Act, which is strongly opposed by government of national unity (GNU) member DA, is not yet in force and will only be implemented when the required regulations and proclamations have been gazetted.

The Treasury said in a statement on Tuesday that different provisions in the act would be brought into operation in a phased approach.

The act aims to provide a broad preferential procurement framework for procurement by organs of state and includes sections aimed at empowerment and transformation such as set-asides, pre-qualifying criteria, and mandatory subcontracting and localisation in certain circumstances. Preferences must be given to blacks, women, people with disabilities, small enterprises, co-operatives and military veterans, the latter being added by the select committee. 

The Treasury said Ramaphosa would bring the provisions of the act into operation through a proclamation in the government gazette. The act enables the president to bring the provisions into operation on different dates in a phased approach and to determine different dates for different categories of procuring institutions such as national and provincial departments, national and provincial public entities and municipalities and municipal entities. 

The Treasury noted that the act allows for the repeal or amendment of different provisions of a law to be brought into operation on different dates. For example, the repeal of the Preferential Procurement Policy Framework Act, would take effect on the same date as the act’s provisions dealing with preferential procurement and related regulations.

Furthermore, the Treasury said, many provisions of the act required regulations before they could be brought into operation.

“The process of making regulations involves consultation with affected ministers, Salga [the SA Local Government Association], and public and parliamentary scrutiny,” the Treasury said. 

“Different regulations for different categories of procuring institutions and for different types of procurement are provided in section 64. The making of regulations regarding procurement of infrastructure and capital assets, and goods and services related to infrastructure and capital assets, are a mandatory requirement.”

The statement said recommendations on the effective dates of various provisions of the act and the accompanying regulations would take into account the readiness of the affected procuring institutions to implement them.

“The current procurement framework provided for under the Public Finance Management Act, the Municipal Finance Management Act, 2003, the Preferential Procurement Policy Framework Act and other applicable legislation, remain in place until the relevant provisions of the Public Procurement Act and accompanying regulations take effect.” 

ensorl@businesslive.co.za