Issue Date: 
Tuesday, February 7, 2017

Brand new Preferential Procurement Regulations 2017 for Tenders

The brand new Preferential Procurement Regulations 2017, has been finalized and was gazetted on 20 January 2017. There are some interesting changes and challenges that we will discuss during the coming months. This is 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 provide for a mechanism 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 an outcome 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, commitment made by government was 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, co-operatives as well as township and rural enterprises. Also, giving impetus to the NGP the highlights of the revision are: -

  • Introducing the prequalification criteria which allow the advancement of these selected categories of people by limiting competition 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, the high value tender 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 requires all those with 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 give the smaller companies greater chances to compete in the economy in a meaningful way. (Refer to 6 & 7)

Commenting on the release of the regulations, Minister Pravin Gordhan says 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 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.

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www.how2tender.com

Title Closing Date Tender No.
Procurement of Hp Servers For Mfd/Goaml/Postilion/Gis Projects IT Infrastructure/17/18 2017-11-16 11:00 RFP20
Supply and delivery of software 2017-10-19 11:00 GK11800232
Water riticulation rehabilitation - Vosburg 2017-11-17 12:00 C00010N
Provision of services for the supply and installation of Soalar Photovoltaic (PV) Roof top systems to the CSIR 2017-11-17 16:30 CSIR RFP 3157/17/11/2017
Supply and delivery of Christmas lights 2017-10-20 11:00 275866
Supply and delivery of Spares 2017-11-21 10:00 PSCED0084
Supply: Supply and delivery of full hd smart tv 2017-10-19 11:00 GK11800230
Montagu Hospital - General Repair and Renovations 2017-11-23 12:00 WCGH 001-2017
Supply: Pickhead - type: diamond and chisel 2017-10-19 12:00 GD11800366
GIS Software License 2017-10-20 12:00 128/2017-2018
Supply: Bowsaw, rake 2017-10-19 12:00 GD11800368
Supply and delivery of office furniture & electrical appliances. 2017-10-23 11:00 275082
Supply: Drill bit, cutterbelt, wheel, allen key 2017-10-19 12:00 GD11800367
Supply: Hydraulic soil pipe cutter 150mm-500mm 2017-10-24 12:00 GD118S0371
Supply: 246l clay pipe cutter 2017-10-19 12:00 GD11800370
Supply of parts for saber 1.5 bush cutters 2017-10-19 12:00 GD11800369
Ecosystem Restoration - Rondevlei, Pelican Park, Strandfontein Birding Area and Sandwolf Nature Reserves 2017-10-30 14:00 SQ11800174
Supply, delivery and erection of Street Names in Kimberley 2017-10-23 11:00 Q013/2017/2018
Leasing of hawker stands at the beach fronts in the George Municipal Area for a period of one year from date of appointment 2017-10-27 12:00 COM001/2017
Replace existing curtains at Langa Civic Hall 2017-10-27 14:00 SB11800323

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Functionality and Tenders

In all competitive bids (tenders) you as the bidder will have to respond to Functionality. You will need to score a set minimum number of points, measured as a percentage, on Functionality of a competitive bid (tender) in order to advance to the next phase of evaluation in the tender process.

Usually Organs of State evaluate competitive bids (tenders) as follows:

  • The tender response is evaluated on Functionality where the bidder must score points out of a maximum of 100 points.
  • A threshold of between 65 to 75 out of 100 points... Read More
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