Issue Date: 
Tuesday, February 7, 2017

New Preferential Procurement Regulations 2017 for Tenders

The brand new Preferential Procurement Regulations 2017, have been finalized and gazetted on 20 January 2017. There are some interesting changes and challenges that we will discuss during the coming months. We start off with the official media release from National Treasury:

The regulations were initially promulgated in 2001 and revised in 2011 thus making this the second revision since the initial promulgation.

The revision of the Preferential Procurement Regulations of 2011 was largely influenced by the need to empower certain categories (Small Medium and Micro Enterprises (SMME) also classified as EMEs or QSEs, Co-operatives, Township and Rural enterprises) through procurement. This was a product of social dialogue on the New Growth Path (NGP), wherein government and social partners signed a Local Procurement Accord on 31 October 2011. To this end, a commitment was made by government to leverage public procurement.

The revised regulations are also aligned to President Jacob Zuma's pronouncement in his 2015 State of the Nation Address, wherein he said, that government will set-aside 30% of appropriate categories of State procurement for purchasing from SMMEs or co-operatives as well as township and rural enterprises. Also, giving impetus/ incentive to the NGP. The highlights of the revision are:
 

  • Introducing the prequalification criteria, which allows the advancement of these selected categories of people, by limiting competition to only amongst themselves. This restricts the inclusion of well established companies, unless they meet further requirements of subcontracting to these groups, should they (established company) be successful. (Refer to regulation 4).
  • Acknowledging that in the main, that high value tenders in the region of R30 million and above have a tendency to be awarded to established companies, due to economies of scale and affordability, leaving out categories of aspiring businesses. The revised regulations require all those, with the ability to deliver the required service, to demonstrate the element of subcontracting to the categorised groups at a tendering stage. (Refer to regulation 9).
  • Addressing the outcry of the categorised groups, who felt that the threshold of R1 million is too insignificant for them to grow to a level of established companies. Current regulations have increased to R50 million. This now gives smaller companies a greater chance to compete in the economy, in a meaningful way. (Refer to 6 & 7)

Commenting on the release of the regulations, Minister Pravin Gordhan said that the regulations aim to use public procurement as a lever to promote socio-economic transformation, empowerment of small enterprises, rural and township enterprises, designated groups and the promotion of local industrial development. He said this is in line with the current dialogue on inclusive economic growth in South Africa.

To learn more about this and all the other new developments regarding tenders, please attend one of our How-to-Tender workshops. Tender Workshop dates are published on our website at www.how2tender.com. For more information on the tender courses please email Werner at werner@how2tender.com.

This article was written by Werner van Rooyen, Director of HowToTender (Pty) Ltd. which specializes in tender consulting and tender training.

Title Closing Date Tender No.
Multiband Ligater Kit, Single Use 8.5 - 11.5mm Scope Diameter With A Clear Barrel For Bonding Oesophageal Vverices. 2018-10-02 11:00 ZNQ NO.2773/ 08/ 18
Supply, Delivery and Off-loading of Cleaning Material and Toiletries for Klerksdorp, Rustenburg and Rooigrond Management Areas (North -West Province). 2018-11-06 11:00 LMN 10/ 2018 NORTH - WEST
Stoma Adhesive Protective Powder Alcohol Free, 28.3g. 2018-10-02 11:00 ZNQ NO.2591/ 08/ 18
Supply, Delivery and Off-loading of Groceries, for Klerksdorp, Rustenburg and Rooigrond Management Areas (North -West Province). 2018-11-06 11:00 LMN 07/ 2018 NORTH - WEST
Equipment: Heating Pan, Rectangular with Non Stick Heating Surface, Portable Design, Including Aluminium Lid with Handle and a Heavy Aluminium Gauge for Even Heat Distribution 2018-10-02 11:00 ZNQ NO.2619/ 08/ 18
Supply, Delivery and Off-loading of Coal Peas, Thohoyandou Management Area (Limpopo Province ). 2018-11-06 11:00 LMN 15/ 2018 LIMPOPO
Non Adherent Dressing With Soft Silicone Technology Atraumatic Dressing, Dressing With Safetac Dressing 20x30. 2018-10-02 11:00 ZNQ NO.2593/ 08/ 18
Bacteriostatic Gel which Containspropylene Glycol (Box Of 10) 15g Tubes 2018-10-02 11:00 ZNQ NO.2592/ 08/ 18
Supply, Delivery and Off-loading of Groceries for Thohoyandou and Polokwane Management Areas ( Limpopo Province) 2018-11-06 11:00 LMN 09/ 2018 LIMPOPO
Smooth Bore Breathing Circuits With Extra Limb And 2lt Breathing Bag Adult (3 Limb) 1.6mtr Long 2018-10-02 11:00 ZNQ NO.2586/ 08/ 18
Disposable Bed Sheets - 100cm X 200cm, Sample Required With Quote. 2018-10-02 11:00 ZNQ NO.2528/ 08/ 18
Supply, Delivery and Off-loading of Cleaning Material and Toiletries for Thohoyandou and Polokwane Management Areas ( Limpopo Province) 2018-11-06 11:00 LMN 12/ 2018 LIMPOPO
Adaptic Digit Non Adhering Dressing Digit. 2018-10-02 11:00 ZNQ NO.2526/ 08/ 18
Supply: Teledyne Benthos 867 Battery Replacement Kits (3002855) - x 4. 2018-09-28 11:00 RFQ000289
Suture Grasper 14 Gauge 15cm Length 2018-10-02 11:00 ZNQ NO.2479/ 08/ 18
Appointment of a services provider for the supply, delivery, training and maintenance of two waste palletizer. 2018-10-12 11:00 GT/ GDARD/ 131/ 2018
Please Supply Sxm40-40 Hot Water Circulating Pumps as per required specification 2018-10-02 11:00 ZNQ NO.2810/ 08/ 18
Supply and Install the Birds Deter Stand (See Picture Attached) Quantity: 1 Unit 2018-10-02 11:00 ZNQ NO.1523/ 06/ 18
Northern Cape: Upington and De aar Area: Rehabilitation of Bridges in Upington and De aar area. CIDB GRADING: 7 CE or Above. 2018-10-16 11:00 DRPW 001/ 2018
Supply, delivery, installation, training, commissioning, internal validation and support of a Microfluidics Fragment Analyser (MFA) for DNA analysis, for use in the Molecular Forensics Laboratory at UCT Health Sciences Faculty for the Western Cape Forensic Pathology Service. 2018-10-19 11:00 WCGHCC034/ 2018

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Advantages and disadvantages of Consortiums

Consortiums are often considered as entities to use when responding to tenders in South Africa. The question that arises is whether to use a Consortium or a Joint Venture when responding to a tender. To help you with this we have compiled a list of advantages and disadvantages for both Consortiums as well as Joint Ventures. In this article we list the advantages and disadvantages of Consortiums. Look out for the same article on Joint Ventures.

Consortiums Advantages:

  • Easy to establish as there are no formal procedures... Read More
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