Public hearings on the Public Procurement Act are provoking diverse responses across the economic and political spectrum
Transnet made a plea to Parliament’s Standing Committee on Finance on Wednesday for a"more flexible" procurement law for the key state-owned companies, arguing that Treasury rules have made them uncompetitive and led to higher prices for goods and services.
Preferential procurement measures require state entities to develop a points-scoring system to promote previously disadvantaged groups in winning tenders. Preference must also apply to goods and services that are locally produced. The policy must include measures to set aside certain tenders for designated groups to ensure subcontracting and the participation of small and township-based businesses.
Requirements for"set-asides" and subcontracting, which are included in the new bill and are widely used by the construction industry, have also caused difficulties by creating expectations from communities that Transnet would do the same. It said this has led to violent community protests targeted at Transnet infrastructure and operations.
Calls for less discretion through ministerial regulations were made by Corruption Watch, the investigative journalism unit amaBhungane, and the Budget Justice Coalition, a group of nongovernmental organisations.
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