Issue Date: 
Thursday, October 31, 2019

Preferential Procurement Regulations 2017

By Werner van Rooyen, Director of HowToTender (Pty) Ltd which specializes in tender consulting and tender training.

The Preferential Procurement Regulations 2017 have been finalized and gazetted on 20 January 2017.

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 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 tend 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 many other tender conditions attend our “Become a Tender Expert” 2-Day workshops presented in Johannesburg, Pretoria, Durban, Port Elizabeth, and Cape Town.  Book and pay online at https://howtotender.co.za/tender-expert-form/

Contact us at wernervr@howtotender.co.za should you require more information.

You can also purchase a Tender Manual (Handbook) on our website https://howtotender.co.za/ which is a step by step guide how to respond to a South African Tender.  It includes examples of completed SBD forms.

Title Closing Date Tender No.
Request for Expressions of Interest: Roster for international consultant for country review mission – socio-economic development (SED) 2021-07-07 11:00 EOI APRM/CRM/AUC/SED / 02/2021
Request for Expressions of Interest: Roster for international consultant for country review mission– democracy and political governance (DPG) 2021-07-07 11:00 EOI APRM/CRM/AUC/DPG/ 01/2021
Request for Expressions of Interest: Consultancy Services to Operationalize and Conduct Trainings on the Use of Digital Platform 2021-07-02 15:00 AUC/IED/C/005
Supply and Delivery of Electrical Consumption Meters and Related Hardware and Equipment 2021-06-25 12:00 TDR192/2020/2021
Supply and Delivery of Passive Ambient Air Quality Equipment and Analysis Services 2021-07-02 12:00 TDR196/2020/2021
Professional Service Providers For The Mossel Bay Municipal Contractor Development Programme 2021-07-16 12:00 TDR186/2020/2021
Supply and delivery of Personal Protective clothing (PPE) for the Mossel Bay Municipality for a period ending 30 June 2022. 2021-07-16 12:00 TDR189/2020/2021
Erection Of A Billboard: Hartenbos 2021-07-23 12:00 TDR200/2020/2021
Renting of Commercial Outdoor Advertising Space For Billboards In Mossel Bay On Municipal Property 2021-07-23 12:00 TDR202/2020/2021
Supply, Delivery And Installation Of Fire Fighting Equipment And Services 2021-07-23 12:00 TDR201/2020/2021
Proposal For The Appointment Of A Panel Of Service Providers For Fundraising 2021-07-09 12:00 SCM 81 OF 2020/2021
Supply and Installation of a Vehicle Monitoring, Tracking and Recovery System 2021-07-15 12:00 SCM 71 OF 20/21
Supply and Deliver Cleaning Material for The Period 1 July 2021 To 31 December 2021 2021-06-25 12:00 Q001/2022
Supply and Deliver Workshop Material for the Period 1 July 2021 To 31 December 2021 2021-06-25 12:00 Q002/2022
Supply and Delivery of Electrical Material For The Period 1 July 2021 To 31 December 2021 2021-06-25 12:00 Q003/2022
Supply and Deliver Household And Consumer Connections Plumbing Material for the Period 01 July 2021 to 31 December 2021 2021-06-25 12:00 Q004/2022
Printing Services For Saldanha Bay Municipality For The Period From 01 July 2021 – 31 December 2021 2021-06-29 12:00 Q005/2022
Supply and Delivery Of Hardware Material For Saldanha Bay Municipality for The Period From 01 July 2021 – 31 December 2021 2021-06-29 12:00 Q006/2022
Supply and Delivery of Hand Sanitizer For Saldanha Bay Municipality For The Period From 01 July 2021 – 31 December 2021 2021-06-29 12:00 Q007/2022
Supply and Delivery of Office Furniture For Saldanha Bay Municipality. 2021-06-25 12:00 SBM 63/20/21

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