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.
Provision of Information Technology System for the Design,Supply,Implementation and Commissioning of an Integrated Electronic Systems for Lepelle Northern Water By a Consortium/Individual/Joint Venture Companies 2020-02-18 11:00 LNW 18/ 19/ 20
Department of Economic Development Tourism and Environmental Affairs: Ugu: Hire of Office Accommodation: A lettable area sufficient to accommodate 816m2 of office space plus to a maximum of 25% of nonassignable space plus 25 undercover bays of which 1 is to be a disabled bay 2020-02-19 11:00 ZNT 2933 W
Provision of Office Accommodation: Ixopo Satellite Office for a leased period of 5 years. (Leases ranging from seven to ten years will also be considered). The office space required should be minimum of 88.28m² with three(3) parking bays 2020-02-20 11:00 27/ 2019
Department of Community Safety and Liaison: Ugu: Hire of Office Accommodation: A lettable area sufficient to accommodate 242m2 of office space plus to a maximum of 25% of non-assignable space plus 3 undercover bays of which 1 is to be a disabled bay., 4 lock up bays required 2020-02-19 11:00 ZNT 2936 W
Department of Human Settlement: Ugu: Hire of Office Accommodation: A lettable area sufficient to accommodate 374m2 of office space plus to a maximum of 25% of non-assignable space plus 6 lockup garages,6 secure undercover bays of which 1 is to be disabled bay 2020-02-19 11:00 ZNT 2934 W
Department of Social Development: Howick: Hire of Office Accommodation: A lettable area sufficient to accommodate 500m2 of office space plus to a maximum of 25% of non-assignable space plus 6 secure undercover bays of which 2 is to be a disabled bay, 8 open parking bays is required. 2020-02-19 11:00 ZNT 2922 W
Provision of Office Accommodation: Umzinto Satellite Office for a leased period of 5 years. (Leases ranging from seven to ten years will also be considered). The office space required should be minimum of 93m² and two (2) parking bays 2020-02-20 11:00 28/ 2019
Provision of Office Accommodation: Queenstown Local Office for a leased period of 5 years. (Leases ranging from seven to ten years will also be considered). The office space required should be minimum of 462m² with thirteen(13) parking bays 2020-02-20 11:00 26/ 2019
Appointment of a Panel of Forensic Investigation Service Providers 2020-02-10 11:00 GPAA 01/ 2020
Team effectiveness sessions 2020-02-11 11:00 FSCA2019/ 20- T017
Chairpersons for disciplinary hearings and initiators 2020-02-11 11:00 FSCA2019/ 20- T018
Office of the Premier: Pietermaritzburg: Hire of Office Accommodation: A lettable area sufficient to accommodate 3785m2 of office space plus to a maximum of 25% of non-assignable space plus 100 secure undercover bays of which 2 is to be a disabled bay, 200 open parking bays is required. 2020-02-19 11:00 ZNT 2924 W
Supply, delivery and installation of five storage containers that will be used for storing condoms at five Eastern Cape Department of Health sub districts (Ngquza Hill, KSD, Mhlontlo, Sakhisizwe and Mbhashe sub district) 2020-02-17 11:00 SCMU3- 19/ 20- 0446- HO
Provision of offsite storage services 2020-02-11 11:00 FSCA2019/ 20- P003
Supply & delivery of perishables to Dora Nginza Regional Hospital for a period of 36 months 2020-02-14 11:00 SCMU3- 19/ 20- 0417- DNG
Provision of Cloud Based ERP system 2020-02-07 11:00 CON3063/ 20
Rendering of Cremation and Burial service of Pauper and Destitute decedents for Western Cape Government: Health Facilities for three (3) year period 2020-02-14 11:00 WCGHSC 0202/ 2019
Provision of Cloud Based Infrastructure and Connectivity 2020-02-07 11:00 CON3062/ 20
Fasset is seeking to appoint a suitably qualified and experienced training provider to work with Fasset to present a half day seminar on Budget and Tax Update 2020 to an expected number of 6500 to 7000 delegates, at 36 venues (including additional venues excluding webinars) 2020-02-07 11:00 FAS/ AN/ PROECTS/ B&T2020/ CON2085
Appointment of an accredited service provider to provide group life scheme to ECRDA for a period of 5 years 2020-02-07 11:00 SCMU 10 – 2019/20

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