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.
Appointment of a QCTO registered Qualification Development Facilitators (QDF) for the reviewing of the occupational qualification Insurance Administration: Claims Assessor NQF Level 4 (99668). 2020-03-02 11:00 RFQ/2020/24
Request for Proposals for the Establishment of Panel of Service Providers for the Learning and Development Content Design and Development Services 2020-03-24 12:00 COR6355/2020/RFP
Appointment of architecture as principal agent for the repair and reinstatement of SABC Studio 6 building structure for period of two years. 2020-03-24 12:00 RFP/LOG/2020/4
The provision of armed guarding security services at Pilansberg Nature Reserve 2020-03-18 11:00 NWPB/RFT/PNPSEC/020/2020
Physical Security Improvement Beitbridge POP 2020-03-11 12:00 RFQ 6547
Rehabilitation, renovation and refurbishment of Inkululeko Yesizwe Primary School 2020-03-20 11:00 DID30/ 02/ 2020
Demolish and construction of the Dr. W.K Du-Plessis LSEN School 2020-03-23 11:00 DID31/ 02/ 2020
Refurbishment of Learskool Frikkie Meyer 2020-03-19 11:00 DID32/ 02/ 2020
Siloam hospital - Construction of new district hospital 2020-03-27 11:00 NDOHF 12/ 2019- 2020
Re-building of burnt down storage shelter for farm material 2020-03-21 11:00 ARC/ 14/ 09/ 19 (Re- advertise)
Bid for the Appointment of a Service Provider for the Provision of Cloud Hosting Platform to host The Department Of Employment and Labour`S Sap S4 Hana Roadmap Landscape and Support for the period of thirty six (36)months 2020-03-20 11:00 BID LAB 10/ 2019
Appointment of a Security Company to Provide Security in Kimberley for a period of 3 years 2020-03-13 11:00 DEDaT 0007/ 2019
The RAF hereby invites experienced and suitable service provider to provide Fleet Management for the Road Accident Fund for a period of five (5) years. 2020-03-13 11:00 RAF/ 2020/ 00003
Appointment of a Service Provider for the Karoo Walking Trails Signage and Mapping 2020-03-13 11:00 DEDaT 0005/ 2019
Appointment of a Service Provider to Develop The Mountain Bike Trails For Mcgregor Musuem in the Northern Cape 2020-03-13 11:00 DEDaT 0006/ 2019
Provision of Open Source Learner Management Service for a period of 36 Months 2020-03-06 11:00 NEMISA/ 2019/ LMSRFB010
The Appointment of a service provider to conduct a feasibility study towards the development of a monumental flag and flag pole. 2020-03-13 11:00 DAC 14/ 19- 20
Appointment of service provider to supply and deliver 5 ton truck for Clanso Farmer Production Support Unit (FPSU) located in ward 18,24,27, and 28 in the Umhlathuze Local Municipality within King Cetshwayo District Municipality in the province of Kwazulu-Natal 2020-03-12 11:00 SS- KZN 7/ 1/ 6/ 3 (753) 3T
Appointment of an HR consultancy firm to provide support to the CETA Administrator 2020-03-06 11:00 016- 2019/ 2020
Procurement of alternative accommodation for the Department of Public Enterprises (lettable office space of 12 144.34sqm and 228 parking bays for a period of 5 years) in Pretoria CBD, Arcadia, Hatfield 2020-03-13 11:00 H19/ 015PF

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