The government spends approximately R500bn on procurement each year, accounting for roughly one-third of the budget and more than 10% of SA’s GDP. Given the large figures involved and the sheer number of tenders issued annually, state tender awards are often plagued with difficulties — for those tendering and those tasked with evaluating and adjudicating bids. Unsurprisingly, public procurement has generated a substantial amount of litigation. Section 217 of the Constitution requires state-owned entities to procure goods and services in accordance with a system that is fair, equitable, transparent, competitive and cost-effective. Generally, this requires advertising and holding competitive bidding processes. At national and provincial government level, all contracts above R500,000 must be awarded subject to a competitive bidding process. The Preferential Procurement Policy Framework Act prescribes that an organ of state must evaluate tenders on the basis of a statutory preferential ...

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