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.
Department of Co-Operative Governance and Traditional Affairs: Umzinyathi District: Nquthu: Community Service Centre Infrastructure Rehabilitation Programme: Alterations and Refurbishment for Molefe Tac 2020-10-20 11:00 ZNTL 04222 W
Provision of Maintenance and Support for Cisco Prime Infrastructure for a period of two (2) years. 2020-10-09 11:00 RFB 2250- 2020
Construction of Mandlazi Primary School Early Childhood Development Centre In Harry Gwala District, KZN. 2020-10-12 12:00 CDC/ 462/ 20- T
Supply and install a Unified Communication solution including Project Management Services during the installation, end devices, formal training, and 3rd Level Support and Maintenance (Software and hardware assurance) for 5 years for the Department of Telecommunications and Postal Services (DTPS). 2020-10-09 11:00 RFB 2266/ 2020
Construction of Savela Primary School Early Childhood Development Centre In Harry Gwala District, Umzimkhu, KZN 2020-10-12 12:00 CDC/ 463/ 20- T
Department of Public works: Pretoria: Procurement of 2 -3 bedroomed fully furnished house with the minimum of 2 bathrooms for Cuban Technical Advisors for a period of 18 months in Pretoria East, Faerie Glen, Menlo Park, Waterkloof and Hatfield. 2020-10-12 11:00 H20/ 006PF
Construction of Straalhoek Primary School Early Childhood Development Centre In Harry Gwala District, UMZIMKHU, KZN. 2020-10-12 12:00 CDC/ 464/ 20- T
SAPS-Criminal Records and Crime Scene Management - Procurement of alternative office accommodation of 1 123.25 square meter and 20 parking bays for a period of 5 years in Pretoria North (CBD). 2020-10-12 11:00 H20/ 004PF
DCS: Sevontein Prison: 36 Months Term Contract: Preventative and Maintenance of Water Treatment Plant It is estimated that tenderers should have CIDB contractor grading designation of 3ME or 3CE or Higher. 2020-10-27 11:00 DBN20/ 09/ 01
Construction Of Early Chilhood Development Classrooms (ECDC) At Luzindela Primary School In King Cetshwayo District, KZN 2020-10-12 12:00 CDC/ 465/ 20- T
DCS: Mthunzini Prison: 36 Months Term Contract: Preventative and Maintenance of Sewage Treatment Plant It is estimated that tenderers should have CIDB contractor grading designation of 3ME or 3CE or Higher. 2020-10-29 11:00 DBN20/ 09/ 03
DCS: Sevontein Prison: 36 Months Term Contract: Preventative and Maintenance of Sewage Treatment Plant It is estimated that tenderers should have CIDB contractor grading designation of 3ME or 3CE or Higher. 2020-10-28 11:00 DBN20/ 09/ 02
DCS: Qalakabusha Prison: 36 Months Term Contract: Preventative and Maintenance of Sewage Treatment Plant. It is estimated that tenderers should have CIDB contractor grading designation of 3ME or 3CE or Higher. 2020-11-05 11:00 DBN20/ 09/ 06
The South African Civil Aviation Authority (SACAA), in its quest to strengthen its brand presence on social media platforms wishes to contract a solid and effective social media and marketing company to develop a social media management strategy and implementation thereof. 2020-10-09 11:00 Q66433345
DCS: Waterval Prison: 36 Months Term Contract: Preventative and Maintenance of Piggery Sewage Treatment Plant and Bulk Water Supply Pump Station. 2020-11-10 11:00 DBN20/ 09/ 07
DCS: Ncome Prison: 36 Months Term Contract: Preventative and Maintenance of Water Treatment Plant It is estimated that tenderers should have CIDB contractor grading designation of 3ME or 3CE or Higher. 2020-11-03 11:00 DBN20/ 09/ 04
Appointment of a Training Provider For Life Orientation Teachers Workshops Over Three Years 2020-10-05 11:00 BS/ 2019/ RFB428
Appointment of a Service Provider Who Is MICT Seta Accredited to Deliver and Implement an NQF Level 4 Film and Television Production Operations Qualification as a Learnership Programme for 30 KwaZulu-Natal Youth Per Annum for a Period of Three Years Which Will Capacitate Them With The Relevant Film and TV Skills 2020-09-28 11:00 KZNFC- T06A/ 2020/ 21
Establishment of a Government Technical Advisory Centre (GTAC) Panel of Professional Service Providers for a Period of Three (3) Years – Batch 4 2020-10-02 11:00 GTAC 015- 2020- 21
For The Identification of Accredited Training Providers to Facilitate The Design and Delivery of a Training Programme on The Mfma Regulated Minimum Competency Levels For Approximately 100 National and Provincial Treasury Officials on Identified Unit Standards 2020-09-25 11:00 GTAC 014- 2020- 21

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